Flour Power

ERNESTO "Ernie" Fajardo said one of the biggest perks of his job as president and chief executive of Liberty Commodities Corporation is having people and friends come up to him and say they grew up with Maya, the company's flagship brand.

"I call this the psychic return on investment.  It's that feeling of satisfaction you get from having a brand that is borne out of high quality, and has earned the loyalty and respect of consumers through the decades.  It is indeed a brand one could grow old with."

LCC, which manufactures for the Philippine market, will be celebrating its 50th year in the hotcake and cake mix business this year, not an easy feat in the cutthroat food manufacturing industry.
 
Its range include hotcake mixes: Maya Original Hotcake Mix, Maya Quick & Easy Complete Hotcake Mix and Maya Chocolate Hotcake Mix; brownie mixes Maya Chocolate Fudge and Maya Butterscotch; Maya Decadence cake mixes: Fudge Brownie, Devil's Food Cake Mix and Yellow Cake Mix; Maya Oven Toaster Mixes: Banana Cake, Chocolate Cake, Butter Cake, Choco Fudge Brownie, and Bibingka (a traditional Filipino cake, usually made with rice flour); Maya Cornstarch, Maya Cake Flour, and Maya All Purpose Flour. Until 2009, the company carried the "Gold Medal" brand from General Milling Corp but decided to cut its 40-plus-year ties with the US firm due to irreconcilable differences.

The company has since focused on further growing the Maya brand, which dominates the market with a 65 per cent share of supermarket sales. "The advantage of having a brand that has reached a very comfortable level of respectability is that once you have maintained quality and you have satisfied the consumer's taste, market dominance becomes lasting," Mr Fajardo explains.

Despite the aggressive advertising mounted by its competitors, Maya continues to dominate the domestic market for hotcake and cake mixes. "Whether you like it or not, top of the mind, when you think of hotcake, you think of Maya.  We have high quality and we have fitted the taste to the Filipino palate."

Tighter margins

In spite of its five-decade success, business has been very challenging.  Increased competition and the fluctuating purchasing power of consumers have kept LCC from jacking up its retail prices.

"Retail prices have been steady for the last two to three years, and increases, if any, are very minimal.  Unless very necessary, we don't raise prices," Mr Fajardo said.
Margins have been getting smaller and smaller, but because of the increased competition the company is hard-put to keep prices steady despite higher production costs. "In the end, the consumer benefits because he is able to get the best value for his money," Mr Fajardo pointed out.

To cut on costs, the company turned to outsourcing on its delivery as well as credit and collection. "It must be emphasised that we do not cut corners to sacrifice the quality of our products.  We cut costs more on services in support of sales, not on manufacturing and product quality," he said.

Still and all, the company has proven to be resilient. The business was able to sustain double-digit growth each year despite increased competition and difficult business environment. "We've encountered such meltdowns [as] the Asian crunch and all, and we were never affected for this particular market."

Mr Fajardo attributes the leadership of the Maya brand to it being first in the hotcake mixes business, and spending more on promotional gimmicks instead of advertising, which he says, is very prohibitive. Still, he admits, the presence of finished products in the market has also been a problem for the company. &Nike Air Penny 2