By Bernie Cahiles-Magkilat
The three Tung brothers are a good study of how a family legacy should be sustained and valued. Gregory Tung Jr., patriarch of the A. Tung Chingco Manufacturing Corp. – the leading canned sardines manufacturer in the country — has already laid out the succession of the family business that was founded by his father Gregory Sr.
Mikko, the imminent successor, and two younger brothers Mark and Macky vowed to make the family’s canned sardines business soar some more and attain greater heights here and abroad.
Although born with the proverbial spoon in their mouths and raised in Canada by parents who instilled discipline and hard work, the Tung brothers stay grounded. The three boys commit that their generation is not the kind to squander what the first and second generations have founded and built over the past 65 years.
Since 1954, A. Tung Chingco Trading, Inc. has been the exclusive distributor of the LIGO products of Liberty Gold Fruit Co., Inc. of California in the US. Ligo is short for Liberty Gold. Gregory Tung, Sr. founded the business and made Ligo products a leading brand in the canned fish industry in the Philippines.
In 1980, the trading firm continued its dominance in the canned fish market and perceived the need to put up its own cannery to produce Ligo Sardines and Ligo Mackerel locally.
In the mid 1980’s, second generation Gregory Jr. strengthened its marketing and manufacturing set-up. In the 90’s, they ventured into new canned fish and meat products — Ligo Mackerel, Ligo Squid, Ligo Corned Beef, and a smorgasbord of Ligo Sardines variants, the likes of Gata, Spanish, Afritada, Kaldereta, Tausi, Tinapa, and Curry, to name a few.
Eventually gaining worldwide popularity, Ligo Sardines and Ligo Mackerel are already being exported to the United States, Europe, Asia (Hongkong, Japan, Singapore, Middle and Far East), and the Pacific Rim. The expanding business is supported by its two factories in Zamboanga and in Metro Manila.
Expanding their offerings even further, the company launched Ligo Meat Loaf in 2008 and Ligo Tuna Flakes in Oil in 2015. They also tapped celebrity endorsers to help promote their new variants.
Over the years, the brand Ligo has earned a worldwide reputation for product excellence, which has been the vision of the founders to manufacture quality products that are affordable to the people.
Its golden rule in business success remains – Quality First. It has maintained strict quality-control standards throughout all of the company’s operations.
Ligo products gained prominence in the Philippine market because of its excellent quality and good taste. Since then, Ligo has become synonymous to “Good Quality.”
“My dad stayed successful for so long because he is so meticulous in our quality. Our father would sacrifice margins, but not quality That makes us confident that when you open a can of Ligo sardines, we are already very formidable even just the sauce,” Mikko adds.
They only use fresh fish at the cannery. They also import blast frozen fish such as sardines and tuna from Japan, China and Oman to augment local supply. According to Mikko, their dad said the local sardines taste better than the imported, although the imported ones look nicer.
The family also actively collaborates with their R and D every time a new product comes up. The fun part is during the taste test period.
Staying true to their thrust of providing the nation with quality products, Ligo has made it a point to continue making improvements in their production line. That’s why, in the past decade, Ligo has minimized human contact during production via equipment such as fish graders and feeders, knobbing machines, and cutlet can-filling machines, among others.
With its focus, Ligo has become one of industry’s formidable players. There are no definite numbers as to the canned sardines’ market in the country, but suffice it to say that Ligo is in the top three, which account for 65 percent of the total domestic canned sardines’ market.
The canned sardines’ market is also unique in the fact that players have sort of regionalized their presence. In the case of Ligo, Mikko said they own Metro Manila but the market changes as you go up north like Baguio or when you go to Palawan.
This is because there are areas that are really price sensitive so consumers have to choose the cheaper brands. Ligo is priced near the expensive price bracket because it is positioned as a premium brand.
Its weakest point is Mindanao. That is why it launched the Mindanao initiative campaign. Part of that initiative is the “Lami Ligo“ campaign with celebrity endorser Tom Rodriguez where they revived the Udong plus Ligo sardines dish, a favorite among Mindanao and Visayas people.
Udong is the yellow colored pasta that are mainly sold in Mindanao and Visayas areas. It costs less and works best with sardines.
“We connected with the masses so much anywhere in Mindanao with Tom singing in the Visayan dialect,” says Macky. The commercial was aired on TV for Mindanao for three to four months straight. “There I can honestly say we got our money back,” adds Mikko.
“Mindanao is a weak region for us so we have this Mindanao initiative which has been super successful,” says Mikko. Before the campaign was launched, they were just shipping one container a month of canned sardines but post commercial, shipments are hitting 4-5 containers a month for the country’s second largest island.
Before the campaign, some supermarkets in Mindanao had zero Ligo presence but the brand is now present in all.
“Now, we have the widest variety of flavors of sardines,” says Mikko. At present, they have 2 to 3 packers and expansion of the Zamboanga factory is also underway to keep with increasing demand.
The Zamboanga factory is five times bigger than the Metro Manila factory. It can produce up to 15,000 cases a day as against 3,000 cases in Metro Manila.
Mark said the best thing to improve efficiency is through automation for very minimal human intervention. Since the Zamboanga factory is automated already, they have fewer employees there than in Manila. During fishing season, they employ as much as 500 people in Metro Manila.
Mikko explained that during their father’s time, Mindanao was not given much priority because there was not enough capacity to supply the entire country. In addition, Metro Manila has better buying power that they decided to concentrate here.
Aside from capacity and plant upgrading, Mikko said they have also to rebrand the 65-year old company. The new generation is looking for a more modern image to align with the young generation by updating its look and labels.
It is not only the physical look of Ligo that needs updating, but the flavors, too. They are looking at new flavors for the youth. That is why they now have the sriracha, its latest variant, which is popular among the millennials.
Mikko said they also plan to widen its export beyond the current markets. “So, wherever there is a Filipino population in the US or in the Middle East and anywhere where Filipinos are present, there is Ligo,” Mikko adds. Still, majority or as much as 90 percent of sales are generated from the local market.
Export is also made easier as the Tung family has finally acquired the Ligo license. They now have a free hand to export directly to the US and wherever because they now own the brand, they just have to pay the royalty.
“This will see us export more to Australia, Canada, and Singapore apart from Europe,” says Mark. Mikko noted that its classic red and green cans remain the bestseller and the favorite among OFWs.
“Sardines is still growing,” says Mikko, a graduate of Philippine School of Business Administration. Ligo alone has been growing double digits annually. Growth this year is expected to further strengthen having fixed their
distribution system with its 30 distributors and improvement in their presence in Mindanao.
“By end of this year, we have the entire Philippines covered,” he adds.
Even if the Tung Brothers were born with the proverbial ‘golden spoon in their mouths’, they were not spared from getting their hands literally dirty as they immersed themselves in different factory functions.
“During summer, we worked in the factory. Training has really been part in our upbringing. So, I can confidently say we are capable to run the company,” says the eldest.
“We were not forced to join the family business, we have a choice,” says Mikko. In fact, their father required them to work a year outside of the family business. But their father really sat down with them and asked them seriously about their plans for the family’s business.
As the eldest, Mikko said it would be sad if they will not be part of the business because it has been with the family for several decades. “It is a family legacy, so let’s give it a chance,” says Mikko.
Among the three brothers, Mikko is the most competitive. He sets high goals for Ligo to be the number one brand in the entire country and overtake other brands.
The third generation has already started implementing new ways to promote the brand in this digital era that is so different from their father’s generation of purely TV, radio and billboards. They put more focus on social media. Their father has also given them a free hand to run their programs and campaigns.
“We make sure that while we give input to each other’s departments, we do not overstep. So far, it is very smooth, we’ve not gotten into big argument,” says Mikko, adding he always makes a mental note to respect his brothers’ own departments.
“I try to do a consensus because I believe we can achieve better results when we discuss things,” says Mikko.
For instance, Macky, the youngest, who finished marketing at Enderun College, has conceptualized all the marketing materials but he consulted his two older brothers who also pitched in their own ideas.
Macky, who as a child wanted to become a lawyer, is more on the creative side and is already thinking of how to communicate his idea of a refreshed Ligo to consumers. “It is a learning curb for me how to communicate my ideas, so it is fun,” says Macky, who joined the company two years ago.
All the three Tung Brothers receive salaries from the family-owned company. “We are part of the employment,” says Mikko.
“Our dad is old school and was raised in a Chinese environment so there comes some form of strictness,” says Mikko. The boys, however, lamented that among their cousins they are the only ones who cannot speak Chinese.
“That is where we fall short of and our dad did not talk to us also in Chinese and when we came back here after our elementary days in Canada, we went to international schools here also so there was no opportunity to learn the language,” says Mikko. The three brothers though can speak and understand Tagalog.
The brothers are not keen about the company going public. “We want it to be strictly family, you can call us traditional, but we don’t need to go IPO just yet,” says Mikko as he cited the hassles of having too many shareholders. As family-owned business, the brothers get full control of the family legacy.
Besides, Mikko said, they are running smoothly. “We get along and there are no big challenges. It is easy to manage, actually,” he adds.
There is no plan also to acquire other brands or joint venture with other brands. This does not mean though they are closed to such opportunities, it is just that the focus this time is simply Ligo because the canned sardines’ industry is at the peak of its competitiveness.
Mikko said they have to expand their Ligo variants as they also offer more variants for the upper class and the young customers. “I don’t want to be stuck in that food for the mass market, but go into the elevated market in terms of palate and branding and we are trying to accomplish that with sriracha,” says Mikko.
Sriracha has proven to be very successful even if it is being sold at P30 because even the mass market is patronizing this new product while the upper-class market still buys the lower end Ligo sardines.
A NEW ERA
Despite being born to a privileged family, the three brothers have their feet firmly planted on the ground.
“Our parents made sure we’re never too spoiled so they gave us just enough, no excesses,” says Mikko.
Macky said they knew all the processes at the canning factory from butchering a fish as it was compulsory for them to work especially during summer breaks.
Mark said they were really immersed in the processes of canning a fish. “It took us a while before we got assigned in the head office,” says Mark.
“We really stink when we go to the factory because you cannot avoid the smell as it really comes out no matter how sealed the facilities are,” adds Mikko.
One thing, they never outgrow their love for the Ligo sardines with each of them maintaining stocks in their respective homes just in case they crave for it.
“I always have stocks of Ligo because I normally eat after gym and it is very convenient because it is all easy open,” says Macky.
The three brothers are also health buff with Mikko into his fitness regimen with yoga class on weekends and just spending time with his wife.
Macky, still single and lives with their parents, just watches shows on Netflix during weekends. “A good chunk of my time is spent playing with my dog,” says Macky saying his dog is his stress reliever.
Mark, a graduate in Export Management from the De La Salle College of Saint Benilde, spends most of his time with his 8-month old baby Mason Lucas at home.
Notably, all the three boys are sporting very visible tattoos. “We go out like this, but during formal meetings, we know how to cover up,” says Mark.
With a successful business, Mark said they have been giving back to the society.
“Ligo is always part of the relief goods distributed during natural calamities,” says Mark. This is on top of their regular feeding programs in public schools in poor localities.
Macky added that Ligo has been passed on from generation to generation becoming a heritage brand and that people have developed a brand love that was also passed on from generation to generation. “That is something we value,” says Macky adding that he gets messages of gratitude from overseas Filipinos for bringing them the feeling of home through Ligo.
“Messages like those are what pushed us to do better,” says Macky.
As the future boss of the company, Mikko vowed that his generation will take care of the family legacy. “I don’t believe the third generation squanders a family fortune founded by the first and improved by the second,” says Mikko.
The future of Ligo lies in this third generation, in the hands of Mikko, Mark and Macky.