Monday, Dec 17, 2018
Industry & Trade | Science & Technology | Asia-Pacific | Singapore

Tech industry, Singapore

Excelpoint: Empowering future technology


1 month ago

Albert Phuay Yong Hen, Founder, Chairman and Group Chief Executive Officer of Excelpoint Technology Ltd.
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Albert Phuay Yong Hen

Founder, Chairman and Group Chief Executive Officer of Excelpoint Technology Ltd.

Excelpoint is one of the leading regional electronic components distributors providing quality components, engineering design services and supply chain management in Asia Pacific. In this interview, Albert Phuay Yong Hen gives more insight into the added value that the company offers its clients, future plans to harness the growing opportunities in fields such as IoT, smart agriculture and e-vehicles, and its new investment arm, PlanetSpark.

 

Could you give us some background about Excelpoint?

Excelpoint has been in the electronics industry for 31 years, and we achieved a great milestone with a record revenue of US$1.15 billion last year. Since the 1990s, we have been working on nurturing a strong technical team which has proved to many of our partners that we provide great value by creating business for them. While the US provides high-tech innovations, Asia has its own ways of doing business. Excelpoint’s position is to be the bridge between our customers and suppliers, presenting ourselves as a value-added partner to them.

Our US suppliers usually come out with the technologies through innovation, but they will not be able to make them into consumer goods because different original design manufacturers (“ODMs”) have their own specifications. This is where Excelpoint comes in – to do some design to the software and the hardware. Our value-add comes from the creation of tech solutions and reference designs, whereby our Research and Development (“R&D”) teams can provide expertise on the preliminary creations. For example, our R&D team can create solutions that are very close to what the end-consumer products need. All our customers need to do will be to go into production and market the final products.

We currently have over 700 employees, and 25% of our staff are actually qualified engineers. We have two groups of engineers – Research and Development (“R&D”) and Field Applications (“FAE”). The FAE team is at the front end, supporting our customers with tech know-hows of our suppliers’ technologies. Again, when you are in the middle, it is important to create added value for both parties.

At Excelpoint, we also believe in innovative technologies. Let me give you an example of Qualcomm, which acquired CSR, a company that does Bluetooth technologies. We started working with CSR when they just started, since 2003. Over the years, we spent a lot of time to create solutions using their technologies and grew with them. Now they are under Qualcomm, and the working relationship continues.

For high-tech American companies like Qualcomm, it is very easy to reach out to Tier-1 customers like IBM, HP, Apple, etc. But when it comes to the Asia Pacific market, there are a lot of Tier-2 and Tier-3 customers that have different business models. With our strong positioning here in Asia Pacific, we know the culture, we speak the language, and we are very close to them, so we know how to create value and deliver win-win results to both parties.

Presently, there are a lot of new technologies coming into play, especially in the early development stage. Thirty years ago, electronics was never considered in early country developments. However, in today’s world, electronics plays a crucial role in advanced technologies right from the start, especially in building a country’s infrastructure and communications.

This sector continues to give us a lot of opportunities. I have spent my whole life in the electronics sector, and I love technology as much as I love the business. I believe with the countless innovations, there are a lot of opportunities in the industry to mine.  

 

Excelpoint supplies to ASEAN and China. How do you see the exponential growth for demand in electronic components in Asia? Especially compared to other regions in the world, this one seems to be much more dynamic.

In China, there is a huge demand in the electronics space, because they are very early in developing their infrastructure for their Made in China 2025 initiative. A very high percentage of the world’s consumption of electronic components comes from China. This will not change for the next 10-20 years.

Apart from China, we also see other up-and-coming countries. One of the biggest is India as we see a lot of its infrastructure developments in action. Moving forward, I think Vietnam and Indonesia have huge potentials, besides Thailand and Malaysia. As for Singapore, we focus more on the technology ecosystem and being an innovation hub.

I am optimistic and very excited to see the Asia Pacific region’s growth in the next 20 years, especially in the electronics industry, which will benefit the US as well. Imagine the growth of smart devices as the emerging markets grow, the demand will be huge as every single one of these devices will require electronic components and modules. As for the consumption, the challenge for the electronics industry is upcycling. I believe we will be seeing this for the next 10-20 years.

 

Could you explain the main reasons you have been able to sustain strong growth over the last few years, while at the same time, building your customer base across Asia Pacific and building 80% of your partnerships in the US?

Our differentiating factor is creating value. We position ourselves to be the partner of our suppliers and customers, not just a trader of electronic components. We have a strong and stable platform that allows for collaborative partnerships. Our R&D teams and the development of solutions give us a competitive edge over many other distributors, and our strong footprints in the Asia Pacific region give us sustained growth. We are like a technology enabler, and this takes years of nurturing and a lot of hard work to achieve.

Ultimately, I believe trust is the key to our success. We deliver the best we can, and we create added value, therefore we are the partner of choice to our suppliers and customers. This has been a successful business model for us for the past 31 years, and we believe that it will also be the core value of Excelpoint moving forward.

We are confident about the future, and we have demonstrated that our year-over-year ("YOY") growth has been very strong and stable. Hence, we look forward to achieving our next billion in the near future.  

 

When it comes to collaborating with your US partner, do you have an example of the application of that collaboration and how that impacts your customer?

Besides getting good technologies from our US suppliers, we are collaborating with a partner who invited us to set up a technical support office in the US. Many of our suppliers have a lot of customers who are small-sized enterprises in the second-tier and third-tier. They do not have the bandwidth to reach out to them, because of their small scale. We have demonstrated to them what we can do and how we can add value through our access to the Asia Pacific market. We can reach out to these second-tier and third-tier customers by being their technical support arm. This will have a very significant impact on our growth. It will benefit us and also some of our manufacturing partners in Asia Pacific. We have attained a lot of businesses from branded companies such as Sony and Bosch, where our reference designs have played a key role in their Bluetooth speakers, headsets and earpieces.

Through us, they can work with our ODM partners in Asia Pacific, and they can market their products and bring orders from Sony, Bosch or Harman. That is a huge business.

 

Could you tell us about Excelpoint’s ongoing digitalisation process?

Currently, the majority of our business is done offline through personal contacts and providing value-added services such as technical support and R&D solutions to our customers. With the emergence of Industry 4.0 and new technologies such as Internet of Things (“IoT”), digitalisation is a must for our organisation moving forward. We recognise the potential of digitalisation and e-commerce. Hence, we have set up an online buying website to reach out to new customers and provide better services to them.

Internally, we are also setting up systems to digitalise our work processes, and this is in line with our company’s direction.

 

E-commerce helps you identify new customers and helps you engage with the clients?

Correct. We use this e-commerce platform to run an online-to-offline business model to attract potential customers, whom we call our long-tail customers. These are customers whose business operations and volumes may be smaller in scale than our usual customers. On the platform, we provide customers with our product details including specifications, prices and stock availability. If customers require only a small quantity or need products urgently, they can make purchases via our convenient e-commerce platform and the products would be delivered to them quickly.

However, if customers require huge volumes and technical support, they can contact our customer service staff through our e-shop, who would then arrange for our local sales offices to follow up with them on their requirements. Most of the time, electronic components require further designs and productions. During these stages, customers require direct technical support to ensure high product quality and faster time-to-market. This is where Excelpoint can add value and shine. We are able to provide customers with innovative R&D solutions and strong technical support, apart from quality electronic components and supply chain management. Thus, customers are most often inclined towards purchasing large volumes of components from us directly, because they can receive our strong technical support on top of our competitive and affordable prices. It is also possible to grow with the company over time.

 

You are in a sector which is evolving constantly. How do you promote the upgrading of skills and the incorporation of new technologies within your company?

Our employees are qualified engineers, who have access to many academic, trade and online sources to get the latest information on new technologies. We also send our engineers for different courses or to our suppliers for training, in order to enhance their knowledge. Our R&D team works hand in hand with our suppliers to explore new ideas, where they constantly engage in brainstorming and ask questions such as “What is next for us?” and “How are we going to incorporate new technologies?”.

As Singapore progresses towards becoming a smart nation, we hope to be one of the key consulting players. In fact, we have recently established a strategic investment arm, PlanetSpark, a subsidiary of Excelpoint. This investment arm aims to look at new hardware innovations and start-ups in Singapore, and we are keen to invest in them. But more importantly, we would like to add value to these technologies, create synergies, and help these start-ups commercialise and grow with our network and footprints.

 

You hope to reach the two-billion-dollar mark in the next four to five years. Could you share your views on Excelpoint’s future plans and strategies?

We have already established a plan to continue growing our organic business, which includes new segments such as IoT and artificial intelligence (“AI”). There are many opportunities in IoT, especially in segments such as smart buildings, smart agriculture and smart infrastructure. These are promising areas that we have identified. I am personally very excited about smart agriculture, as I am optimistic that it will take off in Asia. Smart agriculture is one of the high-potential segments in China, India and Southeast Asia, since it helps with food sustainability.

In our planning strategy, IoT agriculture is one of the key segments, followed by AI and e-vehicles. We are very actively involved in these areas, especially in China and India. There is an urgent need to introduce e-vehicles in China, as they have been strongly encouraged by the World Health Organization to reduce their greenhouse gas emissions. Besides Southeast Asia, we are looking at India, where they are developing their own e-vehicles.

Lastly, we hope to continue growing our technical know-hows, through the expansion of our R&D teams and technical capabilities and the acquisition of new innovations via our investment arm, PlanetSpark. This remains our core focus.

 


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