Indeed, with so many strings to its bow it’s perhaps not surprising to discover that its founder could give master classes on entrepreneurial determination, perseverance and tenacity.
Founded way back in 1974, Second Chance Properties began life as M Salleh Enterprise, a humble menswear tailoring business run by Mohammed Salleh Marican. Having grown up with a father who had his own textile business, Salleh knew the market and was confident his business would do well. However, he couldn’t have been more wrong.
The new tailor had fallen into the trap of spending his capital on out-dated and unpopular materials from the wholesalers – fabrics that the experienced tailors knew customers wouldn’t want.
With few patrons Salleh had to close down his new business after just four months.
Although rudely awakened, Salleh was undeterred and bounced back five months later with an experienced partner and a new company, aptly named Second Chance Enterprises.
This time he had learnt his lesson – Salleh let his partner run the shop, whilst he concentrated on watching and learning.
This time his business was a success. However, Salleh was still not satisfied. Tailoring simply had “too many moving parts”. The amount of material required to make clothing was dependent on the customer’s size and the costs were in turn unpredictable. However, “ready-to-wear” clothing could be produced en masse, in fixed sizes and importantly, with predictable costs.
Salleh made the switch and in 1978, started manufacturing ready-to-wear menswear using cheaper Japanese textile materials. Understanding that the average Singaporean’s wage was very low, he sold his clothing at half the price of established brands – and watched as the customers flooded in.
What’s more, Salleh shrewdly realised that while young Singaporean’s wanted cheaper clothing, they also craved the expensive Western brands. Second Chance decided to advertise its clothing using only Caucasian models, subliminally convincing customers that it was a keenly priced Western clothing store.
It was soon struggling to stock the shelves fast enough.
By 1983, Salleh had four stores in Singapore – and by 1988, through franchising, boasted 18 stores in Singapore and another seven in Malaysia. Second Chance had become a household name and things couldn’t get much better.
However, this was about to change – and all because of a prestigious award.
When is it better not to win an award?
In 1988, Mohammed Salleh Marican won the inaugural Malay Businessman Award, jointly organized by the Singapore Malay Chamber of Commerce and Berita Harian.
Salleh was thrilled – but bizarrely the award proved to be a double-edged sword.
While it celebrated his success it revealed to his customers that contrary to public opinion, Second Chance was a local company – and not a desirable Western brand.
Customers stopped shopping at Second Chance, sales plummeted and Salleh was forced to close 21 of his 25 shops.
By 1992, Salleh was left with just four shops and considerable losses.
Malay Ladies’ Clothing
However, Salleh wasn’t to nurse his wounds for long. Realising his downfall was caused by perception he decided that his Malay company should embrace its heritage – and headed for the Malay ladies’ clothing market.
It turned out to be another shrewd move.
At the time, Malay ladies still had to buy materials for tailors to make up when they needed a new Baju kurung (traditional Malay dress) as affordable, ready-to-wear clothing wasn’t available.
Salleh started to mass-produce his own Malay ladies’ clothing under the name First Lady, selling dresses at half the price of his competitors. First Lady was a hit – and remains so to this day.
A golden opportunity…
Finally things were looking up again.
Salleh started to look around for new business ventures and decided jewellery was the way to go. In 1993, he opened the Golden Chance Goldsmith inside his First Lady store in the Tanjong Katong Complex. It proved hugely popular with the ladies shopping in First Lady and was soon dominating the gold jewellery business in the domestic Malay market.
In 1997, came the Asian Financial Crisis. Struggling companies began to sell off their commercial properties – and Salleh spotted a lucrative new venture. He began snapping up retail properties at rock bottom prices – and changed its name to Second Chance Properties in 1999, to reflect its new core business.
But did you know…
- In the first year of starting his First Lady clothing line, Salleh made $1million – which is the same amount he had made in 1988, with 18 Second Chance stores.
- Golden Chance differentiated itself from the competition by introducing a popular concept – it allowed customers to weigh their gold before purchase.
- Property rental income contributes 60% of Second Chance’s bottom line of $30m.
- Mohammed Salleh Marican was named Ernst & Young’s Entrepreneur of the Year 2012.
- Mohammed Salleh Marican left National Service with the rank of Lieutenant.
Today, Mohammed Salleh Marican continues to serve the company as its Chief Executive Officer and Executive Chairman.
Second Chance Properties continues to retail ready-made traditional Malay apparel through its 43 First Lady stores – three in Singapore and 41 in Malaysia, which continue to be extremely popular.
As for the future, the group plans to expand its Malaysian operations to 100 stores in the next few years in line with the country’s rising population and disposable income.
The company still sells gold and jewellery through its Golden Chance Goldsmith store, which has increased three fold in retail space since opening to 1,300 square feet, and continues to dominate the domestic Malay gold jewellery market in Singapore.
Second Chance also currently holds 57 properties – 56 in Singapore and one in Malaysia from which it obtains rental income. However, as the company has stated that it believes the real estate market here is slowing, things may be changing in the future. The company is also engaged in the business of securities investment.
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The Motley Fool’s purpose is to help the world invest, better. 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.