By Lynn Kan

RETHINKING division of labour is never a bad thing, and in fact, was the driver behind Filtec's growth.

Having branched out from the automotive industry, it now provides filtration parts to power-generating stations, mining companies and marine companies.

Filtec first started its business under Soon Aik Group, a family-run business specialising in the distribution of automotive parts.

Filtec's managing director Jimmy Neo and his brothers then went back to the drawing board. They decided to venture beyond the restrictive automotive industry.

Their business strategy now has four foci - wholesale, export, retail and service - to penetrate the various industries.

Now, Soon Aik and its other subsidiaries are engaged in automotive-related businesses, while Filtec focuses its business in supplies to the marine, power generation, construction, agriculture and mining industries.

Mr Neo attributes the rapid growth to the company's correct mix of products at the outset. 'We started off distributing just filters.

However, our customers needed other bread and butter commodities such as lubricants, batteries and wear and tear parts.

From there, we expanded our scope of supplies to where we are today.' It got its first big break when a top US filtration company approached them to distribute its line of products.

'Although we are a small company, carrying premium, reputable and established brands helped us gain recognition and competitive advantage over other companies.'

It then dropped lower-end brands from its stockhouse, and started to focus on providing top quality products to its clients.

Now it carries leading filter product brands from American, Japanese, and European manufacturers.

Stocking brand-name products has given Filtec more clout in the business and the company grew by leaps and bounds.

It moved beyond Singapore, to the wider Asean market. At the close of 2004, it recorded revenue of over $5 million.

Now more than three years later, it has tripled sales to $14.2 million, and looks set to achieve its $17 million projection for 2008.

To achieve those results, Filtec has had to paddle hard to keep up its reputation. It vows to answer all customer inquiries within 48 hours.

Its distinguishing mark: its stock is almost always available and rarely drops below 95 per cent.

Inventory is checked regularly so that advice about products given to customers is accurate. That helps to reduce complaints to less than five cases a year.

'Because most principals encounter stock-out situations, we as a multi-brands vendor are able to fulfil more of the customers' orders, especially during an urgent need for parts,' said Mr Neo.

What remains a problem is Filtec's status as a small company.

Prospective hires usually prefer bigger companies over minnows like Filtec when job hunting.

It is limited by the local market as well. Local firms usually take longer to pay up, as compared to their overseas counterparts.

Its short-term goal is to strengthen its current distribution network by way of premium product mix and wide application across industries.

'As we strengthen our distribution with our existing key customers in neighbouring countries, we're also extending our reach to Asia-Pacific, North Asia, South Asia, Middle East, Africa and Europe,' said Mr Neo.

This article was first published in The Business Times on 23 July 2008.