Here’s how Adrian Ng, Group CEO of Mega Fortris Group, built a multimillion dollar business from products that cost only a few cents

Most of us might not realise it, but we’ve probably benefited from Mega Fortris Group’s security seals in one way or another: when we’ve picked up a bottle of our favourite whisky, sent or received a parcel in the post, or even voted in Malaysia’s last General Election. “Security seals are a fascinating, under-the-radar product,” remarks Adrian Ng, the company’s Group CEO. “Twenty years ago, not many people were aware of them but, by now, they’ve come to realise that our seals are unique products.

“They secure the integrity of any product against pilfering and tampering, so it’s a vital component of any supply chain. Yes, our products are simple, but their impact on our customers’ business are massive.” From its headquarters in Kota Kemuning, which houses a purpose-built manufacturing plant, Mega Fortris shifts half a billion security seals each year – a remarkable quantity that’s made them one of the largest designers and manufacturers of security seals in the world.

LOCK AND LOAD

It needs to be emphasised that Mega Fortris Group’s achievements are an example of sibling collaboration done right: besides Ng, his elder brother, Dato’ Dr Nick Ng (who holds the position of Group Executive Chairman), has helped guide the company towards their shared vision of a global business. The two brothers grew up in Penang along Caunter Hall – now, of course, known as Jalan P. Ramlee – in a large family of 14 children, which was supported by their father’s motor vehicle workshop. “All my siblings were very close, and the older ones would always take care of the younger ones,” Ng recalls.

After a stint with a Malaysian company to help build its security seals business, he realised just how significant the impact of these seemingly cheap, unassuming, one-time use items was, and he approached his brother with a business proposal. “I believed right from the beginning that my elder brother – being more experienced in business – would provide important input to get this idea off the ground. Initially, it wasn’t easy to convince him to see the viability of a business based on selling items priced at a few sen each!

“It took a while – and some persistence – before we worked out a plan together to take on the opportunity, but he proved to be a marvellous business strategist and a great mentor to me.” Despite their 15-year age gap, the brothers have steered the company to success (even through rough patches like the 1997 Asian Financial Crisis), as affirmed by corporate advisor Gin Lai: “This is a great example of best of yin and yang. They’re very different in personality – right down to their individual working styles and dress sense – but they have diverse strengths. The magic has been in their ability to feed off and grow on each other’s strengths.”

Although Mega Fortris Group now boasts an impressive client roster of thousands of customers, Ng remembers all too well how difficult those first years were when the company took its first steps in 1996. “We had only one product, no facilities – nothing. To tell a potential customer that our product was security-conscious – well, it took a lot of convincing to get that across. I remember driving 400km to the middle of nowhere, just to get an order for 2,000 seals from a palm oil estate.

“It was an enormous order back then, as it was our first stepping stone. But I’m glad to say that, once we secured our first customer, it was through references and the way we operated Mega Fortris Group that the natural progression of acquiring customers took off on its own, and we managed to build our business to the volume we have today.” Even now, Ng is a firm believer in the power of the personal touch, and spends the majority of his time overseas in order to connect with the company’s clients.

“You can be our client of 20 years, and it’s still important for me to be there every year to keep that relationship going. From there, I can see whether they’re happy or if there’s anything extra we can do to add value to the customer. As Group CEO, I also have the responsibility to ensure team members communicate well, both within and externally, since expensive mistakes can result if my team and I misread a situation or are slow to respond. Additionally, I keep a pulse on things and identify strategies for us to win business, and to keep moving forward as a progressive brand and group.”

THE STICKING POINT

Over the past 22 years, Mega Fortris Group has built up a network of overseas subsidiary offices in diverse locations such as the United States, Denmark, Hungary, the UAE, France, South Africa and the United Kingdom, with more than 90 per cent of its revenue generated through export markets. To understand exactly why their products – which have a price range of just 10 sen to MYR3.50 per unit – seem to have struck gold with big-name international clients, including the likes of Fonterra, Amazon, Evergreen, Nestlé and Chivas, Ng points out that you have to take entire global trade and transport networks into consideration, with all of their ebbs, flows and vulnerabilities.

“Imagine you’re travelling with a suitcase. A lock isn’t good enough if your bag’s not properly sealed. We’re not worried about it being stolen: our concern is directed at your bag being planted with things that aren’t supposed to be there. What if you’re stopped at customs and caught? Your responsibility is massive. There’s no way of saying, ‘This doesn’t belong to me.’ Ignorance is no excuse in the eyes of the law.” Multiply that on an industrial scale, with millions of shipping containers, intermodal containers and cargo boxes making their way from Point A to Point B, and it creates a wealth of opportunities for those involved in fraud, smuggling, theft and the black market to take advantage of.

“We are the enabler of integrity and accountability in a chain of custody for our clients to ensure that if there’s any tampering, pilfering or a potential breach, they have enough evidence to help prevent it from happening in the future and to take corrective measures. That’s crucial, because the item – along with your branding or reputation – could be damaged. Think of maple syrup that’s been contaminated or tampered with. It’s not expensive, but once it goes into the supply chain, recalling the product will be a nightmare. This is why security seals are so important to the ecosystem of the supply chain.”

Of the many seals created by Mega Fortris Group – many of which are manufactured under ISO standards and patented – its most popular products have proven to be the pull-tight seal (which, in spite of its deceptively slender 3mm thickness, has a strength of nearly 20kg and can be used to secure anything from roller doors to airline trolleys) and their trademark bolt seal. As successful as these may be, however, Ng is fully aware that the company’s security seals can only offer a certain amount of physical protection.

“In this world, there is no such thing as being tamper-proof. There’s never any guarantee that tampering will not occur. It will happen: it’s how you minimise its impact. You close the window of opportunity until it’s so small so that the chance to do anything is very difficult. Yes, the bad guys never sleep, but these are the people that keep us in business! They might think that whatever we make, they can find a way to defeat our seals – but the reverse is also true. We can come up with a way to counter or prevent them, so we always ensure we’re two or three steps ahead of them.”

With this in mind, the company has already taken steps towards introducing a digital element to its operations, where transparency and traceability are at the forefront for its customers. “My brother and I have a vision of Mega Fortris evolving into a complete security solutions group – one that embraces and employs technology. Not only will we be a supplier of physical seals, but we’re looking at offering a total solution, where our customer has visibility through the full length its supply chain. It’s our dream to see the company progress into a total security and supply chain solutions company within the next decade.”

LOOKING AHEAD

Having already spent nearly two years researching and developing a technological system capable of supporting what Mega Fortris Group considers a coherent solution, Ng is eager to highlight the benefits it would offer, not just to industrial manufacturers and suppliers, but the wider public as consumers too. “Looking from the point of production to a product’s arrival on the table, we’ll be able to have stakeholders along the way that can verify it. For example, your milk powder or whisky is authenticated along the full chain – from shipment to shop – and that’s what the whole ecosystem will be built on.

“You know it’s not been tampered with or switched with a counterfeit. When it reaches retailers, the product can be verified and, when it’s sold, the consumer can authenticate it as a genuine product. And we’ve looked at business efficiency: how our system, with its infused technology – and, ultimately, automated tracking – can create a better product flow for companies. We’ll supply them with the basic tools to look into the upstream movement of their operations. Imagine, a company could reassign those in manual jobs to more strategic or value-added positions, and they’ll see pretty substantial savings from it.”

Alongside the growth of the digital arm of Mega Fortris Group, Ng and his brother have laid out an ambitious plan of action for the group: “We’ve gone through 22 years to get where we are today, and we’ve reached a peak in terms of what we’re doing. 2019 will be the start of a new journey, but it’s not going to take two decades – all of us are getting older! We’ll condense it into a five-year journey, where we’ll begin by consolidating the group to put it on a firmer footing and grow it to a different level. From there, we want to work to treble our turnover to closer to MYR500 million and look into a future listing.”

Additionally, he mentions that they’re looking in the direction of creating biodegradable seals as part of their CSR programme (they’re currently working with another Malaysian company to create semi-biodegradable seals composed of rice husk and plastic composites), and already provide a recycling programme for customers willing to send their used seals back to them. With such an intense focus on creating a sustainable future – in more ways than one – the question of Mega Fortris’ next generation of leaders inevitably crops up.

“It’s definitely on my wish list for my kids to come in – and the same goes for my brother’s and business partners’ children as well!” Ng, who was named EY Master Entrepreneur Of The Year in 2017, exclaims. “This a very different business with a great ‘family feel’, and if we can cultivate or continue that, it will be really nice to have. My daughter has already graduated and is working in our New Zealand office, while my son is still in college, so I hope to groom both of them to pursue their careers with the company.” As Ng has learnt over the years, Mega Fortris’ strength lies not just in its seals, but in choosing the right people and the right company values.

“When we first started, our motto was ‘With one seal, we will conquer the world’. The fact that international clients and market leaders have given these opportunities to a Malaysian-based company brings recognition to Malaysia itself – and we’re proud of that. But, 22 years ago, I wouldn’t have been able to predict that we’d be where we are today. While we needed to produce a good product, even that wouldn’t mean it would sell well. The core strength of our products was the human capital behind it, who ensured Mega Fortris would succeed.

“As far as we’re concerned, the growth of our company has never been wholly centred on making profits. We based Mega Fortris on family values and added them to a corporate environment, which I believe is rare nowadays. Of course, we need to make enough to support the families of our 700 employees and to reinvest back into our system, but the core of the company has always boiled down to the family values instilled from our parents: passion, integrity and humility in everything we do.”

TEXT RENYI LIM
ART DIRECTION AUDREY LIM
PHOTOGRAPHY GERALD GOH/IMAGE ROM
PHOTOGRAPHY ASSISTANTS SAIFUL AZWAN, NG SEONG WEI & MUHAMMAD ZAMARUL ZAMAN PRODUCTION SUPPORT METAL BEES