Most people outgrow their toys after a certain age. But not Chia Ah Kau.
At 69, he still enjoys being surrounded by miniature cars, stuffed toys and colourful playthings. The chief executive of Malaysia’s largest toy retailer, Daisheng (M) Sdn Bhd, is still very much young at heart. And how can he not be when he has spent almost his whole life surrounded by toys?
Chia, who was born in Johor, played with toys in his early years. But while boys in their teens move on to comic books and other whatnots, his interest in toys was sustained by the experience of working in a toy shop at the age of 13.
Chia’s family moved across the straits in 1963 during his late teens. At the time, Singapore was still a part of Malaysia.
Having settled in Singapore, Chia’s family opened a toy store to sell imported toys. The shop lasted only a few years, but by then Chia had become enchanted by the wonderful world of stuffed toys and die-cast cars.
“You can’t go wrong with toys. Every child wants at least one. There was a lot of potential to grow a business with toys,” he explains of his decision to pursue the toy business.
So in 1971, with a capital of S$500,000, Chia started Tai Sing with a group of friends. Tai Sing imported toys in bulk and distributed them all over the island-state through other toy retailers.
“It was tough. We did not have enough capital, so we started out as a small firm. And our stock was limited by the amount of money we had. We couldn’t bring in the variety of toys that we wanted,” Chia says of the early days.
But Tai Sing started at an opportune time. In the early 1970s, there were not many toy wholesalers in the market, and this gave the company an advantage to grow its business.
Homecoming
After a few years, Tai Sing started supplying toys to Malaysia. And business was good in those days. Chia noted that its Malaysian market in the West Coast alone drew in sales of RM300,000 to RM500,000 a month. And this was in the late 1970s.
Soon, the company saw a need to set up a local operation in Malaysia and this led to the establishment of Daisheng in 1982.
Daisheng saw encouraging growth over the years as Malaysians grew more affluent and could afford to buy more leisurely things. The company steadily increased its supply to other general toys wholesalers as well as major hypermarket retailers and chain supermarket stores.
Now more than 30 years on, Daisheng is known as the largest and oldest toy wholesaler in Malaysia.
But it hasn’t always been smooth sailing in the last three decades.
Chia notes that the exchange rate between the Singapore dollar and Malaysian ringgit has changed a lot over the years, and this affected the group tremendously. It was particularly apparent during the Asian financial crisis when the ringgit plunged.
“We used ringgit to trade between Daisheng and Tai Sing. So when the ringgit fell, we were getting half the value of sales in Singapore. And the market was very bad during those years.
“The local operations survived but Tai Sing suffered losses from its trade with Daisheng. The Singapore company took two years to recover. Quite an irony, isn’t it?” laughs Chia.
Going into retail
The financial crisis also forced Daisheng to explore a different business model. Chia explained that it was difficult to collect its debt from consignees at the time, which meant that the company would have a problem with cash flow. Hence, Daisheng decided to move into retail where it would be able to run a cash-based business by selling directly to consumers.
However, the retail business had its own set of challenges. It required a bigger capital outlay for an outlet and finding a trusted manager was no easy task. But Daisheng did not have the luxury of options, recalls Chia.
The first Toycity outlet opened its doors in 2001 in Mid Valley Megamall. And they have added a few more outlets since.
Today, Daisheng makes an average revenue of RM15mil a year, the bulk of which is still derived from its wholesale business. According to Chia, Daisheng holds about 40% share of the toy wholesale market in Malaysia and he is hoping to grow that percentage.
“There are a lot of challenges to growing the business now. The main one is, of course, currency. But you can grow if you understand the market. You need to bring in toys according to new trends and phase out older toys,” he says.
While it is a challenge identifying toy trends, Chia says the best way to beat the competition is to bring these toys in before the trends hit fever-pitch. Premium-type toys, Chia points out, are not suitable for the local market as Malaysians are quite cost-conscious.
He says toys have certainly evolved over the years. Chia remembers toys being so much simpler back in his younger days. He recalls that one of the first few toys he sold were basic James Bond cars. But the times have changed.
Today, toys come with complicated mechanisms and impressive gadgetry. And toys will only become more advanced with time as toymakers compete to continue to impress the children.
“These days, children prefer to look at their screens,” muses Chia, who hopes Daisheng will develop more of its own products as well as have more wholesale toys that are specifically manufactured for the company. This include the special edition die-cast PDRM toy car collection, which it launched early this year.
Chia has been through much with the growth of Daisheng. The lines at the corner of his eyes are evident, but Chia is far from calling it a day.
“There have been many sweet and bitter memories in running this business. But, of course, having come this far, I’d have to say it has been a satisfying journey. And if I still have the opportunity, we want to continue expanding Daisheng,” smiles Chia.
