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5 Things You Should Know About QAF Limited

While the food company QAF Limited (SGX: Q01) may not be a familiar name, chances are you have one or two of its products lurking in your kitchen.

Household names such as Cowhead milk and dairy, Farmland frozen products and Haton seafood are all thoroughbreds from the QAF stable – although it is probably its Gardenia bread products that are the best recognised.

Ben & Company

QAF’s roots date back to the 1950s when a small food trading and distribution firm by the name Ben & Company was set up in Singapore, specialising as a “hygienic meat delivery service”.

By 1958, it was incorporated as a private limited company, which was listed on the Singapore Stock Exchange in 1967.

By the 1970s, Ben & Company had established itself as one of the largest food importers and distributors in Singapore and Malaysia and in 1984, the company decided to change its name to QAF limited.

Gardenia Bakery

Meanwhile, in 1978, a small bakery named Gardenia had opened in Singapore’s Bukit Timah Plaza Shopping Mall. With the expertise of American baker Horatio (Sye) Slocumm, the bakery quickly gained a loyal following and by 1983, they had set up a commercial bakery at Pandan Loop, producing 2,000 loaves an hour.

Competition was fierce, but Gardenia reckoned it had the superior product – “softer-textured, tastier flavoured and enriched bread”. Coupled with excellent marketing, Gardenia’s delivered fresh” loaves were snapped up by Singaporeans – and within two years had become our most popular brand of packaged bread.

QAF acquires Gardenia

In 1985, QAF completed acquisition of Gardenia whilst simultaneously developing its own in-house brands of Cowhead, Farmland, Haton, Spices of the Orient sauces and Orchard Fresh beverages.

But the company was struggling and by 1988, approaching bankruptcy.

Turnaround

Fortunately, help was on the horizon.  A business man by the name of Wong Fong Fui, who had started life a poor rubber tree tapper but worked his way up to become a business expert, became an investor and the managing director of the ailing QAF – which at this point had a market cap of just over $15m.

Concentrating on the company’s only profitable segment, Gardenia, Wong turned QAF around – within three years it was not only exporting its products throughout Asia, but had become one of the regions largest food businesses.

ISO 9002

By 1989, Gardenia had the dominant share of Singapore’s packaged bread market. In 1996, its automated bakery was the first in Asia to be awarded ISO 9002 quality certification with a Grade A status.

Expansion

The company continued to prosper and had started to expand into China, India and the Philippines where, by 1999, Gardenia had the largest market share of the sandwich bread market.

QAF was also running the largest bakery operations in Malaysia and in 1997, become Singapore’s largest packaged loaf supplier when it acquired its biggest packaged bread rival, Bonjour.

Pork and Dairy

In 2001, the company bought one of Australia’s largest pig-breeding and pork-production operations, where it now deals with grain production, livestock research and development as well as meat processing and production of premium quality fresh meat products. This was followed by the acquisition of two Australian dairy farms.

But did you know…

  1. Gardenia was the first bakery in Singapore to receive the Gold Award from the Agri-Food and Veterinary Authority (AVA) for achieving Grade “A” status for 15 consecutive years in recognition of excellence in hygiene, sanitation and processing.
  2. Gardenia, Cowhead and Farmland have all achieved “Superbrand” status in Singapore.
  3. QAF is the largest producer and exporter of pork in Australia
  4. The company is also one of the largest wine distributors in the region, handling more than 300 labels from Europe, the USA, South America and      Australia.
  5. Ex-QAF Managing Director Wong Fong Fui was born into a poor Malaysian family on a rubber plantation and became a rubber tree tapper from the age of 7. He taught himself English from a dictionary studying ten words a day and was accepted into secondary school upon submitting an essay about his life that included the lines: “I tap rubber trees. I see rubber trees in the morning. I see rubber trees in the evening. I see rubber trees every day, day in, day out. Rubber trees, rubber trees. I hate rubber trees”. 

Today, QAF is an investment holding company, producing, processing and exporting bakery, pork and dairy products throughout Singapore, Malaysia, the Philippines and Australia.

Market leader Gardenia is still its flagship brand, supplying over 200,000 households in Singapore with fresh bread every day and still follows the traditional American recipe for its sandwich loaves introduced by Sye Slocumn back in 1978.

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The information provided is for general information purposes only and is not intended to be personalised investment or financial advice. Motley Fool Singapore contributor Alison Hunt doesn’t own shares in any companies mentioned.