| Tuesday, 12 January 2010 |
| Ogawa to open concept stores by end-2010 |
| KUALA LUMPUR: Ogawa World Bhd plans to open at least two concept stores in the Klang Valley by end-2010 to promote its co-owned Cozzia brand, said its executive director Louis Chong.
Each concept store would cost RM300,000 to RM500,000 to set up with the first store expected to be opened by the end of March, he said at the launch of the Cozzia product yesterday. "The concept store is in line with Ogawa´s plan to promote wellness home furnishing concept in Malaysia with the introduction of the Cozzia product," he said. He added that the concept stores would be located at major shopping malls and target customers from the upper-middle to high-income groups. "We will focus on building a strong market in Malaysia for the first two years. Thereafter, we will bring the brand (Cozzia) to countries where Ogawa is present at an accelerated rate because the learning curve will be shorter," he added. Chong said while the brand was not expected to bring in significant contribution to Ogawa´s revenue at the moment, it would help the company´s growth in the long run. "The massage chair category is still seeing a strong growth, and Ogawa sees the value of adding product offerings as consumer interest in overall wellness continues. "There is a void in the marketplace for better-end consumers, particularly in the home theatre and motion categories featuring massage. We plan to fill that void," he said. Ogawa recently signed a co-ownership agreement with US-based Cozzia to brand, market and distribute its products in the Asean region and some parts of Asia. Cozzia is a leading retailer of furniture with built-in massage capabilities. Ogawa has 150 outlets in nine countries, namely Malaysia, Singapore, China and Hong Kong, Indonesia, Australia, Vietnam, Myammar and Saudi Arabia. For its first quarter ended Sept 30, 2009 (1Q10), Ogawa posted a net profit of RM84,000, reversing a net loss of RM4.5 million a year earlier. Revenue rose to RM35.2 million from RM27.4 million. However, compared to the preceding quarter, 1Q10 net profit was 97.4% lower. © Copyright The Edge Online |
Thursday, 8th October 2009
Update Ogawa teams up with Aussie firm
by Surin MurugiahKUALA LUMPUR: OGAWA WORLD BHD is venturing into the distribution of clinical diagnostics products via an exclusive distributorship agreement with Australia-based V-Patch Medical Systems Pty Ltd, the developer of the V-Patch, the world's 1st on board real-time cardiac analyser.
In a statement today, Ogawa said it would hold exclusive distribution rights for the V-Patch On Board Real-Time Cardiac Analyser in nine countries across Asean and other parts of Asia. It said V-Patch would be the first third party product to be distributed by Ogawa.
Its subsidiary Ogawa Health-Care (Selangor) Sdn Bhd today entered into the sales and distribution agreement. Ogawa group has 150 outlets across 26 cities and nine markets — Malaysia, Singapore, China, Hong Kong, Indonesia, Australia, Vietnam, Myanmar and Saudi Arabia.
"The group has been looking for synergistic products that can help us boost revenues and add more depth to our offering while complementing our existing products in terms of target market, demographics and retail habits," said Ogawa executive director Louis Chong.
He said the company was optimistic about prospects from V-Patch due to the needs of the markets it operated in and the exclusivity of this cutting edge product.
"The company will continue to explore new market opportunities such as V-Patch and pursue steady expansion as it becomes a global player," Chong concluded.
In the statement, Ogawa said based on the information provided by the Ministry of Health Malaysia, cardiovascular diseases had been a leading cause of death in Malaysia since 1970.
According to the World Health Organisation (WHO), 16.7million people around the world die of cardiovascular diseases (CVD) each year, which is about one in every three deaths. WHO data also shows that in developed as well as developing countries, between 40% and 75% of all people who suffer a heart attack die before reaching a hospital and receiving treatment.
V-Patch Medical Systems founder and CEO Peter Taylor said the V-Patch addressed an important need in mainstream cardiology. The system builds on the existing global practices of early identification and subsequent treatment of at-risk cardiac patients.
"Patients have full mobility and do not need to be admitted to a hospital for observation as they wear slim-line disposable "patches". These are connected to a small device (known as v-pod) with built-in intelligence that collects, analyses and transmits to treating physicians, by utilising existing cell phone networks and the internet," he said.
Tuesday December 02, 2008
Leveraging on wellness trend
Branding has always been integral to Ogawa, a focus that is reflected in its organisational structure. "Although we design and own the patents for our products, we prefer to outsource their production. This ensures that our team is primarily focused on brand – building and customer service," says Louis Chong, executive director of Ogawa World Bhd.
For Ogawa World, customer service and brand-building must go hand-in-hand, with customers at the heart of their every decision. "We want to give them what we want, not what we'd like to sell," says Chong. To provide the best experience for consumers, the company invests heavily in staff training. "Our strongest advantage over our competitors is our people. They are passionate about the pursuit of excellence, and they are the spirit behind the brand."
The company started out in 1996 under the name of Healthy & Nice. It was established by Richard Wong, executive chairman, and Lim Poh Khian, deputy executive chairperson, of Ogawa World, to market Ogawa-branded products. "It seemed like a good time as the economy was booming and Malaysians were enjoying a higher standard of living. They were also getting more health-conscious, so we marketed our products in that direction," explains Chong.
Unfortunately, the company was immediately put to the test when the Asian financial crisis hit in 1997 and the Malaysian economy went into recession. Undaunted, Wong and Lim viewed it as the perfect time to expand and acquire better shop locations and recruit strong talent. They also shifted their focus from premium goods to more affordable items, such as a hand-held massager that sold for RM150. "At times of crisis, people need to de-stress for their health, more than ever!" says Chong.
Ogawa weathered the storm and emerged stronger, and began to market the brand even more aggressively between 1999 and 2001. "In that year, we established 20 outlets," says Chong. A friendly face was put on the brand when they appointed former 988 Radio DJ Chan Fung in 1999 and Datuk Jalaluddin Hassan in 2001 as brand ambassadors. In 2000, the company held up to 10 road shows a month.
As a result of their brand-building activities, Healthy World Sdn Bhd (incorporated from Healthy & Nice in 2001) was awarded the Asia-Pacific Entrepreneur Excellence Award, Branding Category in 2003. This was followed by Best Brands Award (Best International Brands Category) in 2004; Ogawa was named a Malaysian Superbrand in 2005.
By then, Ogawa was making its foray into China. And according to a TNS survey, in the electrical massage products category, it enjoyed 69% brand preference among Malaysians. "This was the beginning of the brand fulfilling the name, Ogawa. It's the Japanese word for stream, and for us it embodies the concept of starting small in Malaysia and emerging as a mighty ocean in the international arena," says Chong.
When the company was listed on Bursa Malaysia last year, it changed its name from Healthy World to Ogawa World. By then it had established distribution in Vietnam and Hong Kong. "It was a fresh start for us; we launched ourselves as an international brand. To personify our new status, we appointed a regional brand ambassador, Emil Chau Wakin, a Chinese singer who is famous in the Asia-Pacific region, particularly in Malaysia, Hong Kong and China. We also adopted the slogan 'Close to You' to symbolise our desire to bring the products closer to the people," explains Chong.
According to Chong, Ogawa has spent about RM25 million in advertising over the last two years within the Southeast Asian region. "Overall, we stick to the industry average of 10% to 12% of profit for brand-building and advertising activities," says Chong. Ogawa World's profit before tax for the financial year ending June 30, 2007 was about RM22 million.
Ogawa continues to maintain the goal of a "healthier lifestyle" as its brand promise. Its range of products is marketed under five categories with "health-targeted" goals. The categories are: relaxation – to combat stress; therapeutic – using reflexology and other means as therapy; fitness – products to help you exercise; diagnostic – blood pressure monitors and thermometers; and finally, hygiene – filters for air and water. "Our users tend to be results-oriented and practical. They are more likely to buy our products if they have a good reason for using them. A luxury-oriented message wouldn't be enough," says Chong.
At present, 70% of Ogawa's total revenue is from the SEA region. "We aim to replicate it through to the rest of the world," says Chong. The company has taken its first steps in the Middle East, having just signed an agreement with a distributor there. The first outlet is scheduled to open in Dubai in January next year. Ogawa World is also attempting to break into the Mumbai market, but this is still in the process of negotiation.
"Our goal is to bring this Malaysian brand to an international platform. We believe we are part of a sunrise industry as people get increasingly affluent and desire healthier, happier lifestyles. The current financial crisis does not change these aims, in the long term it's still the right direction to head. We are merely more cautious in moving forward with our expansion plans. Rather than cut our ad spend, we will spend it more wisely," says Chong.
Although it will be a challenge, he is confident Ogawa World will weather the current economic situation and its effects on consumer spending, just as it has done before. "We are in a good position, and even at times like this, people still need to enjoy and de-stress. Also our brand has never been stronger – consumers recognise our brand name first, before any product," says Chong. "Everyone, from children to senior citizens, can sing our 'Ogawa' theme."
Monday February 25, 2008
Ogawa enters Myanmar market
SUBANG JAYA: Health and wellness equipment retailer Ogawa World Bhd has established a foothold in Myanmar and is close to naming a distributor for the Indian market, said its executive director Louis Chong.He said a distributorship agreement for Myanmar was signed in January and Ogawa’s products would hit the market soon. "We hope to start our business in Yangon in one or two months and in Mandalay around June," he told The Edge Financial Daily .
Ogawa would market its full range of products there as luxury items targeting the "cream" of consumers. In Malaysia, Ogawa has positioned its products for the middle and upper segments of the consumer market with an emphasis on lifestyle.
"We are very confident of the Myanmar market as the people there are becoming more affluent. We are going to have aggressive road shows, outlet expansions," Chong said.
He said Ogawa also expected to finalise its choice of distributor for India in three to four months and begin sales in Mumbai.
He said the company would leverage on its international brand status in competing with local companies.
Chong said Ogawa was also looking for potential partners in the Middle East. "Hopefully we will decide on a partner this year," he said.
He anticipated a slowdown in the global economy in the next two years, but believed Ogawa would pull through. "Health is a compulsory thing. If you use the right strategy on the right audience, they will still invest in health."
He said Ogawa already has strategies in place, such as more affordable products like its Smart mate massage chair launched last month.
He said the Smart mate, which retails at RM4,899, would appeal to younger people who wanted the health benefits but had tighter budgets.
Chong also said the company would allocate 10% to 20% of its revenue for advertising and promotion, and maintain its practice of launching five to eight products annually.
Monday March 3, 2008
Ogawa downgraded on poor margins concerns
OGAWA World Bhd, whose first half results came in below Inter-Pacific Research’s expectations, has been downgraded to underperform from outperform as the research house is concerned about its pressured margins.Ogawa posted a net profit of RM435,000 on the back of RM64.75 million in revenue for the six months ended Dec 31, 2007 (1HFY08). Inter-Pacific Research said Ogawa’s 1H revenue was 13.3% below its forecast of RM74.6 million.
It said the company’s pre-tax profit and net profit experienced “severe plunge” due to pressured margins following rising overhead costs in view of aggressive outlet expansion plans, coupled with its inability to transfer cost to consumers.
Earnings before interest and tax (EBIT) margin rose only 1.15% in 1HFY08, it added.
Quarter-on-quarter, Ogawa’s second quarter (2Q) revenue rose 13.4% to RM34.41 million, while pre-tax profit increased 296% to RM1.14 million due to lower base, despite operating under tough conditions, the research house said.
The improvement saw Ogawa turning around from a loss of RM192,000 in 1Q to a profit of RM627,000 in 2Q.
However, Inter-Pacific Research was concerned whether Ogawa would be able to maintain their traditional strong growth in the upcoming 4Q.
“Historically, Ogawa’s 4Q tends to be the strongest, benefiting from occasions like Father’s Day and Mother’s Day. For instance, we found their 4QFY07 revenue, PBT and PAT accounted for 35.2%, 43.3% and 43.9% of their full-year earnings.
“But looking at the current trend, we doubt that this feat could be maintained given their high overhead costs,” it said.
The research house expected Ogawa to continue experiencing strong margin pressures, at least until the end of the current calendar year.
It, however, noted that current expansion plans could contribute more positively to Ogawa’s bottom line in FY09 if the operating environment becomes more stable and witnesses less margin pressure.
“Hence, we have downgraded our recommendation from outperform to underperform, with the fair value pegged at 57 sen based on forward EPS (earnings per share) of 5.21 sen for FY09 that translates into a PER (price-earnings ratio) of 11 times,” it said.
Ogawa closed one sen lower at 74 sen last Friday with 100,000 shares traded.
Monday February 4, 2008
Ogawa to spend RM2mil on IT
IF you're a fan of healthcare and wellness equipment, you can expect to see more targeted campaigns from Ogawa World Berhad in the latter part of the year to cater to your specific needs.
At the signing of the partnership are (from left) IBM Malaysia's general manager, general business Chiam Yat Seng, Ogawa's cheif financial officer Chew Eng Loke, Chong, Lim and SL Information's Pronto division manager Ho Wai Chun.
"We have appointed SL Information System Sdn Bhd to implement the Pronto Xi Retail solution that will be powered by IBM's System p550 server. This partnership will enable Ogawa to further the standards of our customer service and store process productivity by seamlessly integrating core operations from the store-front to the corporate back-office. This is key to drive continued business growth," said Ogawa's executive director Louis Chong in Petaling Jaya last week.
The nine-month project, which kicked off this month, also will see new point-of-sales systems being deployed in all of its 70 stores in the country as well as laptops to be specifically used for roadshows.
With the system in place, Ogawa will be able to optimise back-end operations and keep up with daily transaction volumes and workload peaks while ensuring uninterrupted service to meet customers' demands. The company also will be able to receive precise and timely information on customer buying behaviour to make better strategic decisions.
In addition, inventory harmonisation measures and customer relations programmes can be developed more dynamically according to business needs.
Once the project is completed, the system will then be rolled out to other 100-odd Ogawa stores around the world. 'The Pronto Xi Retail solution will enable Ogawa to better manage point-of-sales data, procurement processes and back-office functions, which will allow the company to further expand from 172 stores to a projected 350 stores over the next five years," Chong said.
Meanwhile, SL Information's general manager Jimmy Lim said the company is confident of growing its business by about 20 per cent this year. "Like Ogawa, 90 per cent of the retailers in Malaysia are mid-sized enterprises that require tailored solutions to drive customer and operational excellence for the retail industry. The retail industry has come of age in Malaysia, and we see bright prospects in the market."
Friday January 18, 2008
More than just a massage chair
OGAWA, which recently launched the Smart Mate massage chair, will be giving away the new Mercedes-Benz CClass worth RM250,000 to lucky winners of Ogawa’s C the New Luxury Contest.
Customers with purchases of RM1,000 and above in a single receipt are eligible to participate in this contest. The more they purchase, the more lucky draw chances they get.
Luxurious prize: Eric Cheah, Ogawa World Berhad executive director (right) and Daniel Tan, Cycle & Carriage Bintang Berhad general manager (sales and marketing) at the launch of Ogawa’s C the New Luxury Contest.
The chosen ones will then attend the prize giveaway event at 1 Utama Shopping Centre on March 30 to draw a lucky key that could unlock the luxurious new Mercedes-Benz C-Class.
On top of that, Ogawa will also be giving away two new Smart Mate massage chairs and other consolation prizes worth more than RM25,000.
Wednesday August 22, 2007
OGAWA pre-tax profit up 16.8pc
OGAWA World Bhd has posted a 16.8 per cent increase in pre-tax profit to RM22.2 million for its financial year ended June 30, 2007, when compared to the previous year.
Its revenue went up 7.6 per cent to RM146.4 million, the company said in a statement today.
OGAWA said although the profit performance was marginally below the company's forecast made at its listing in April this year, the result marked a healthy uptrend.
Describing the overall performance as "highly satisfactory", executive director Louis Chong said the decision to fully expense start-up costs in new overseas markets accounted for a substantial percentage of the deviation.
Chong said OGAWA plans to continuously introduce new models as well as new range of products into the market.
He said for overseas, the company would focus on expanding its reach in high growth markets such as China and Vietnam.
According to Chong, OGAWA expects to sustain double-digit earnings growth in the current financial year ending in June 2008.
Sales growth in Malaysia is expected to remain robust and the company's increasing presence in overseas markets will translate into positive bottomline contribution, he said. - Bernama
Monday February 4, 2008
Ogawa to spend RM2mil on IT
IF you're a fan of healthcare and wellness equipment, you can expect to see more targeted campaigns from Ogawa World Berhad in the latter part of the year to cater to your specific needs.
At the signing of the partnership are (from left) IBM Malaysia's general manager, general business Chiam Yat Seng, Ogawa's cheif financial officer Chew Eng Loke, Chong, Lim and SL Information's Pronto division manager Ho Wai Chun.
"We have appointed SL Information System Sdn Bhd to implement the Pronto Xi Retail solution that will be powered by IBM's System p550 server. This partnership will enable Ogawa to further the standards of our customer service and store process productivity by seamlessly integrating core operations from the store-front to the corporate back-office. This is key to drive continued business growth," said Ogawa's executive director Louis Chong in Petaling Jaya last week.
The nine-month project, which kicked off this month, also will see new point-of-sales systems being deployed in all of its 70 stores in the country as well as laptops to be specifically used for roadshows.
With the system in place, Ogawa will be able to optimise back-end operations and keep up with daily transaction volumes and workload peaks while ensuring uninterrupted service to meet customers' demands. The company also will be able to receive precise and timely information on customer buying behaviour to make better strategic decisions.
In addition, inventory harmonisation measures and customer relations programmes can be developed more dynamically according to business needs.
Once the project is completed, the system will then be rolled out to other 100-odd Ogawa stores around the world. 'The Pronto Xi Retail solution will enable Ogawa to better manage point-of-sales data, procurement processes and back-office functions, which will allow the company to further expand from 172 stores to a projected 350 stores over the next five years," Chong said.
Meanwhile, SL Information's general manager Jimmy Lim said the company is confident of growing its business by about 20 per cent this year. "Like Ogawa, 90 per cent of the retailers in Malaysia are mid-sized enterprises that require tailored solutions to drive customer and operational excellence for the retail industry. The retail industry has come of age in Malaysia, and we see bright prospects in the market."
Monday April 30, 2007
Story of two 'O's
Between the LinesBy C.S Tan
Ogawa, a homegrown distributor of up-market massage chairs, has set an admirable track record in its revenue and earnings. The record of rival OSIM shows the global market is scalable, and the potential for Ogawa.
OGAWA World Bhd, the distributor of massage chairs and foot massagers, had an uneven experience in its listing recently.
The stock closed at RM1.14 on Friday, holding on to a modest 14% premium over its initial public offering (IPO) price of RM1.00 a share, after a high of RM1.40 on debut day.
This unexceptional performance could be due to a sell-off by some of those who successfully subscribed for the IPO shares.
The company issued 17.2 million new shares to the public and employees while major shareholders made an offer for sale of 36 million shares to bumiputra investors.
Sellers should have considered owning the shares for the long term. Ogawa has built an excellent financial track record in a business that is scaleable regionally as well as globally.
Ogawa is in the same business as OSIM International Ltd which is listed on the Singapore Exchange where the latter was hailed for its ability to grow out of the small Singapore market into large new markets in the rest of Asia and the US.
OSIM has grown to a market value of almost RM1bil, and it even partnered Temasek Holdings Pte to take over Brookstone Inc, a chain store in the US.
Ogawa, which has a market value of RM137mil, is moving in the same direction. With a firm foundation in its home market, Ogawa has started to export its products to regional markets, and the initial efforts look promising.
The group's revenue grew each year from RM52mil for the year ended June 30, 2004, to RM136mil last year and is forecast to reach RM162mil this year.
Exports formed just RM4mil of group revenue in 2004 and had increased to RM29mil last year. It has even managed to plant a foothold in OSIM's backyard. Ogawa's sales in Singapore started with RM2.8mil in 2004, which rose to RM14.1mil last year.
Ogawa has an admirable track record in its net profits which came up from RM4.3mil in 2004 to RM11.7mil and are forecast to grow 37% to RM17mil this year. It achieved that with no borrowings throughout that period.
One of the reasons it could do that is it does not have to invest in plant and machinery. Production is outsourced and the company focuses on product design, marketing and brand management.
Although Ogawa sounds Japanese, it is homegrown, and its founders are executive chairman Wong Lee Keong and deputy executive chairman Lim Poh Khian.
Ogawa traded at a prospective price/earnings ratio of 8.6 times which is reasonable in view of its high growth rate.
Punters taking a quick profit are giving longer-term investors an opportunity to buy the shares and take a bet that this company still has a long way to grow.
Thursday April 19, 2007
Ogawa makes strong debut on Bursa
KUALA LUMPUR: Ogawa World Bhd shares debuted at a 40 sen, or 40%, premium against its issue price of RM1 on the main board yesterday.Executive director Louis Chong said: “With our successful listing, we will certainly be aggressively expanding our business and brand building in Malaysia and overseas.”
Advertising and promotion activities for the health and wellness company, which were budgeted at 10% of annual revenue, would include television commercial spots in China and Vietnam this year, he told reporters following the listing ceremony.
Ogawa posted revenue of RM136mil for financial year ended June 30, 2006 (FY06).
Chong had said at the company's prospectus launch that Ogawa saw China and Vietnam as its major growth markets this year, expecting them to contribute much of its forecast 19% growth in revenue to RM162.4mil for FY07.
Apart from Dubai, the company had just identified Chiangmai, Bangkok and Mumbai as locations for its planned 11 new outlets to be opened this year.
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| Ogawa executive director Louis Chong looking at listing board after the listing of Ogawa World Berhad on Bursa Malaysia on Wednesday |
The company currently has 114 direct outlets located in Malaysia, Singapore, China and Hong Kong with another 35 sole distributorships in Indonesia, Australia and Vietnam.
Chong also said Ogawa would be proposing a dividend of 5 sen per share for FY07 and also planned to launch five to 10 new products this year.
For the Malaysian market, Ogawa would continue its tie-up with 16 banks in the country to provide 12 to 36 months' interest-free instalment plans for its customers, he said.
After hitting a high of RM1.40 and a low of RM1.19, Ogawa shares ended the day among the top gainers at RM1.23.
