Uni-President is a household name in China's FMCG sector, known for its enduring bestsellers like instant noodles and milk tea. In April 2016, the founder of Uni-President Group, Taiwan's food industry godfather Kao Ching-yuen, passed away. Beyond the sorrow, there is immense admiration for his life journey.
In the spring of 1958, Momofuku Ando built a small shed of less than 10 square meters in the backyard of his home in Osaka, Japan, as a research lab for instant noodles. He found an old noodle-making machine, bought a wok with a diameter of 1 meter, and ingredients such as flour and cooking oil, and immersed himself in experiments day and night, which led to the invention of instant noodles that later swept the world.
Ten years later, Kao Ching-yuen, who had resigned from Tainan Spinning Company after more than a decade of service, founded Uni-President Enterprises, and subsequently introduced Japan's instant noodle culture to Taiwan. From bread and frozen foods to beverages and canned goods, Uni-President permeated the daily lives of every Taiwanese person, successfully transforming Kao from a cloth shop apprentice to the "Godfather of Taiwan's Food Industry."
On April 1, 2016, Kao Ching-yuen passed away due to respiratory failure caused by pneumonia, and his funeral was held quietly in Taiwan.
Many people may not be familiar with this food industry magnate who always wore a smile but had not appeared in public for years, yet they are well acquainted with Uni-President's corporate logo and its various foods and beverages. Since entering the mainland market in the 1990s to invest and set up factories, Kao fulfilled his original dream over more than two decades: "I just want to create the taste of the Chinese people and contribute good things for the enjoyment of over a billion compatriots."
From Apprentice to Success
Born in Tainan in 1929, Kao Ching-yuen had a difficult upbringing. Due to poverty, he only managed to finish primary school. His father passed away when he was 13, and at 14, he became an apprentice at the Xin He Xing Cloth Shop run by the Wu brothers, who were also entrepreneurs in Taiwan. The hardships of life made him more hardworking and diligent than others from a young age, and he began to accumulate business acumen early on.
In 1952, Kao and several colleagues and friends from the cloth shop started their own business, founding the "De Xing Cloth Shop," marking his first step in entrepreneurship.
By 1967, at the age of 38, Kao had accumulated 24 years of work and management experience and was about to face the biggest turning point in his life.
It was in that year that the Taiwan authorities lifted the ban on imports of bulk commodities, and flour mills were allowed to be privately owned. Kao decided to abandon his cloth business and venture into the flour and feed industry, which was still in its infancy in Taiwan.
Kao founded Uni-President Enterprises Corporation in Tainan, raising NT$32 million for operations, and served as general manager, leading 82 initial employees into the food industry.
In the early days of the venture, Kao seized the opportunity presented by Taiwan's rapid economic development and the surge in demand for convenience foods among busy office workers. He actively cooperated with Nissin Foods of Japan, which held the largest market share in Taiwan at the time, to introduce instant noodles to Taiwan. Uni-President instant noodles gradually became a bestseller. To this day, the instant noodle business remains one of Uni-President's pillars. From there, Uni-President's feed mills, flour mills, and sports drink factories gradually developed, launching "Uni-President Feed" and "Uni-President Flour."
In the 1970s, Taiwan's rapid economic growth also brought a significant increase in consumer purchasing power. Adhering to a strategy of diversified development, Kao expanded beyond instant noodles into dairy, beverages, frozen foods, seasonings, bread, and other food segments. He personally participated in the development of many well-known Uni-President products, including Uni-President Braised Pork Noodles, Wheat Aroma Black Tea, Honey Soy Milk, Uni-President Pudding, Cha Li Wang, and Lai Yi Ke.
After nearly half a century of development, Uni-President's business continued to expand, gradually becoming a food empire comprising more than 30 companies, covering multiple food categories, with a complete production and sales system. In addition, the Uni-President Group's footprint includes convenience stores, logistics, baseball teams, and various other industries, making it ubiquitous in the daily lives of Taiwanese people. In 2015, the Uni-President Group's consolidated revenue reached NT$416.4 billion (approximately RMB 83.488 billion), with a net profit after tax of NT$14.1 billion (approximately RMB 2.827 billion).
Taiwan's United Daily News commented on Kao Ching-yuen: "From a cloth shop apprentice to a corporate tycoon, he made the Uni-President kingdom play an important role in the life history of Taiwanese residents and the development history of Taiwan's food industry."
Bold Crossovers
By the late 1970s, after a period of rapid development and expansion, Uni-President had become Taiwan's leading food company. However, Kao realized that producing good products was not enough; Uni-President needed stronger control over distribution channels, to obtain sales intelligence from stores as a basis for product development and marketing, and to improve sales efficiency through modern management.
During a business trip to Europe, Kao heard a presenter say: "In the future, whoever controls the distribution channels will be the winner." These words struck him like an electric current. He immediately wrote down the phrase and instructed his subordinates to conduct research.
In 1978, he established "President Chain Store Corporation (large-scale chain convenience stores)" and opened the first President convenience store, entering the retail industry and ushering in Taiwan's retail channel revolution.
Although the supermarket business performed poorly initially, Kao withstood the pressure and cooperated with international companies such as Japan's 7-Eleven and France's Carrefour, finally turning a profit in the mid-1980s. Taiwan's thriving convenience store culture today is inseparable from Uni-President's early persistence and judgment.
7-Eleven stores operate 24 hours a day, with thousands of outlets across Taiwan, woven into the fabric of people's lives, and are the leader in Taiwan's convenience store industry.
In fact, President Chain Store was not an immediate success. After Kao acquired 7-Eleven, it suffered losses for six consecutive years. Kao often recalled this period with a wry smile: "The NT$200 million capital was lost in less than three years, and many shareholders were clamoring to withdraw their shares." Many peers privately mocked Kao at the time, saying, "Luckily, I didn't follow his example."
But Kao believed in his vision. He preferred to arrange a share swap between the parent company and President Chain Store, absorbing all external shares, making President Chain Store independently operated by Uni-President, and never giving up on 7-Eleven. Under his persistence, 7-Eleven, as if by fate, turned profitable in its seventh year and has since become the "golden goose" cherished by the Uni-President Group.
Today, President Chain Store, established 38 years ago, has nearly 5,100 stores across Taiwan, holding a 50% market share in the island's convenience store sector, far ahead of the second-place FamilyMart with 3,000 stores.
The Uni-President Group currently has seven listed companies, including Uni-President Enterprises (China), President Chain Store, Uni-President Industries, Uni-President China Holdings, Da-Tong-Yi, Taiwan Synthon, and President Securities. If including invested companies, the Uni-President Group's business footprint covers almost all industries in Taiwan.
Whenever asked about the secret to his business success, Kao would squint and show his signature smile, saying: "To start a business or pursue knowledge, you must have the determination and will to stake your life and fortune on it. If you do that, nothing will fail."
Trust Without Doubt
Looking back at Kao Ching-yuen's business success, besides seizing opportunities and daring to act, embedding "credibility" into his business philosophy was also a key reason. As a result, despite only having a primary school education, Kao was awarded an honorary Doctor of Laws from Lincoln University in the United States and an honorary Doctor of Management from National Sun Yat-sen University in Taiwan after successfully founding the Uni-President Group.
Kao often told friends that the 82 employees who started the business with him are now all wealthy and successful, which is his greatest achievement. In management, he was equally sincere, emphasizing the "Three Goods and One Fairness" (good service, good credit, good quality, and fair prices) philosophy, which was widely publicized. This required products to be of first-class quality, ensuring consumers could buy with peace of mind, and that business should prioritize "sincerity."
Among the "Three Goods and One Fairness," Kao particularly emphasized "credit." Even after becoming the "overlord" of Taiwan's food industry, he still regarded "credit" as more important than anything else. He once said: "Credit is the intangible asset of an entrepreneur. A true entrepreneur, if he has character, can become a great entrepreneur even without capital. Character and credit are inexhaustible capital."
He often admonished employees that competition among peers is inevitable; you can tout your own products, but never speak ill of others.
According to Taiwanese media reports, although Kao was the "patriarch" of Uni-President, in the eyes of his colleagues, he was approachable, without airs, always smiling. Regardless of status, if you visited him, he would always escort you to the elevator and watch you leave. He also remembered the names of employees he had interviewed and would greet them by name when he met them.
In 1987, a "Uni-President" brand aluminum foil beverage was poisoned at a grocery store in Taiwan, causing an uproar when the news broke. Kao responded that although Uni-President was also a victim, it had to bear social responsibility, and he decided to recall the beverage across the island. Sales of the aluminum foil beverage suffered temporarily, but the willingness to bear economic losses instead won public sympathy and praise, and the market gradually recovered, enhancing the company's reputation and customer trust.
In 1992, Taiwan experienced the sensational McDonald's bombing case. Although this incident had nothing to do with Uni-President, Kao still decided to suspend operations for a day at the 35 KFC outlets the company operated across the island. Despite some losses, it once again won public approval.
Kao once publicly stated: "I am straightforward by nature, dislike hypocrisy and pretense, and refuse to follow the crowd or echo others. I act in peace, seeking only to have a clear conscience. Therefore, whether internally or externally, I say what should be said and do what should be done."
Hsu Chung-jen, who worked at Uni-President for 35 years and is known as the "Godfather of Distribution," recalled that when Chairman Kao learned he had studied distribution and chain operations, he asked him to plan the distribution business. Originally, Hsu was at Uni-President's headquarters, and later the President Chain Store Corporation evolved into the independent business President Chain Store. Chairman Kao's complete delegation and trust without doubt gave him a different life experience. "Chairman Kao was very enthusiastic about work and trusted employees greatly, always giving them ample space. Especially for employees with unique insights into the distribution industry, he would insist on letting them run the business, even if it lost money, he would let them do it freely."
A Childlike Heart
In 2014, Kao Ching-yuen was first listed in Forbes magazine's Taiwan Top 50 Richest. Coming from a poor family, even after achieving success and holding high positions, he maintained a simple lifestyle, believing that a plain and ordinary life is a blessing.
The popular local drama series in recent years were deeply loved by Kao. One of his greatest pleasures every night was sitting in front of the TV watching serials. Speaking with a Taiwanese accent, he always greeted people with a smile. When getting a haircut, he preferred to visit the small barbershop he had frequented for years. He joked that even with a generous tip, it wouldn't require a thousand-dollar bill.
It is well known that Uni-President and Master Kong are long-time competitors who "love and hate" each other. In Taiwan, Uni-President is the undisputed leader in food retail; however, on the mainland, the title of "Taiwan's food retail leader" must be ceded to Master Kong.
Kao always attached great importance to the mainland market. He once said: "We believe there are great opportunities in mainland China because if we sell our food to the United States, the basic tastes are different, and people won't buy. But on the mainland, since we share the same language and similar tastes, as long as we have professional talent, we can adjust to the most suitable local flavors."
In 1992, Kao actively promoted Uni-President's entry into the mainland to invest and set up factories, dispatching 166 "Uni-President people" to work in mainland companies. Despite an initially advantageous position, Uni-President missed the opportunity to expand its instant noodle market on the mainland due to a "unadapted" shrimp noodle product, allowing competitor Master Kong to take the leading position in the mainland instant noodle market.
Although Uni-President entered the mainland instant noodle market only 15 days later than Master Kong, it mistakenly focused its development on shrimp noodles, which were "unadapted" for mainland consumers just being introduced to instant noodles. In stark contrast, Master Kong conducted market research and vigorously marketed braised beef noodles, capturing the mainland instant noodle market. After gaining fame on the mainland, Master Kong also later attacked the Taiwan market with low-priced instant noodles, putting pressure on Uni-President.
In the face of an unfavorable start, Kao began strategic adjustments to turn the tide. After careful research of the mainland market, Uni-President launched different flavors of instant noodles for different regions. Over more than 20 years, with steady progress in "instant noodles" and other foods, especially in the last two years, Uni-President has regained some ground through innovation and the launch of new products beyond instant noodles. On the mainland, although Uni-President lags slightly behind Master Kong in instant noodles, it has earned a reputation for "quality and reasonable prices" and remains an undisputed food giant.
Currently, Uni-President's investments in mainland China include Wandashan Dairy, Sanshui Jianlibao, and Huiyuan Juice, and it also holds operating rights for international brands such as 7-Eleven, Starbucks, Mister Donut, and Cold Stone Creamery in Taiwan and parts of mainland China. The mainland has undoubtedly become the largest investment market for the Uni-President Group outside Taiwan.
In 2013, Kao stepped down from the position of chairman of Uni-President Enterprises, officially handing over to his son-in-law, Lo Chih-hsien, and no longer participating in the company's actual operations. However, the Uni-President he founded still maintains enormous influence in Taiwan, even surpassing its competitor, the Ting Hsin Group, which owns the Master Kong brand.
In the 1980s, with Taiwan's economic takeoff, the Uni-President Group gradually became a leading enterprise on the island. Kao served two terms as chairman of the Taiwan Industrial Federation and repeatedly advised the Taiwan authorities to open up "three direct links" across the strait. He believed: "The mainland market is vast, and it is an inevitable trend for Taiwanese businessmen to invest there. I am clear about Taiwan's economic prospects; only by establishing a harmonious relationship with the mainland will it be beneficial for Taiwan. Although my stance has offended some political figures, the general business community and the public support my views."
Kao valued cross-strait relations and yearned for China's strength. "I just want to create the taste of the Chinese people and contribute good things for the enjoyment of over a billion compatriots," Kao said in an interview with Xinhua News Agency. "If the two sides of the strait cooperate well, in the 21st century, we Chinese will definitely be the strongest."
The 3rd (CFIC) China FMCG + Internet Conference will be held in Chongqing in November 2017. The conference will closely focus on the theme "New Forces, New Ecology," inviting 1,000+ distributors, 500+ brand owners, founders of 200+ B2B platforms, and 100+ investment and financing institutions to jointly explore a new chapter of cross-border integration!
Core topics of this conference:
How can the FMCG industry achieve new growth opportunities through B2B
How to build a new supply chain behind new retail
How can intra-city logistics help B2B achieve leapfrog development
Highlights of this conference:
The industry's first "2017 China FMCG B2B Industry Competitiveness White Paper"
Case sharing of excellent transforming and upgrading distributors
Exhibition upgrade: Hall 6 Internet Technology Exhibition strengthens matchmaking
Alibaba Retail Link, Global Logistics Properties Finance, Eternal Asia Supply Chain, Best Store Plus, Yijiu Pi, and Hdwell: leaders from various fields will deliver speeches and share pioneering views.
November 8-9, 2017 Xinyue Hall, Chongqing Yuelai International Convention Center Registration is now open. Long press the QR code below or click "Read Original" to register. Add friend with note "Conference Registration" Click the links below to review the highlights of the 1st and 2nd FMCG + Internet Conferences: 2016 "FMCG + Internet" Summit Forum -END-