Steaming Ahead

Miele division managing director shares how he hawks luxury to the masses

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When Kenny Lam Cho-kan asked a friend whether he should accept a sales job at Miele, the answer was a resounding no. His friend had a point. The German white-goods maker, whose local office was established two decades ago, was a big fish in a small pond.

Lam, managing director of Miele Hong Kong and Macau, joined in 1999, a year after the local unit was set up. The aftermath of the Asian financial crisis could then still be felt. With everyone tightening their purse strings, selling high-ticket home appliances that few could afford was a struggle.

In those days, a washing machine from Miele could easily fetch five-digits. It may sound reasonable, given a notebook computer costs around the same, but it was rare for people to pay so much for electrical goods.

“People could not make sense of our prices. Remember, it was the time when iPhones didn’t exist. The It phone was a Nokia 8800,” Lam joked.

“And what’s called a kitchen was a counter top with a gas stove. It made no big difference whether you lived in Tregunter Towers at Mid-Levels or in public housing.”

Lam was tasked with selling dishwashers, washing machines and vacuum cleaners to retail shops. Vacuum cleaners sold best as they were a lot cheaper.

“A retailer told me that his shops would not carry our brand even if we supplied products for free,” Lam recalled. “Now it’s not uncommon to see households spending tens of thousands of dollars to install nice built-in branded cabinets and appliances in the kitchen.”

In two decades, Miele has added more than 100 retail locations in Hong Kong and Macau, and grown annual sales by nearly 50-fold.

The local unit is marking its anniversary by unveiling a two-story flagship store and experience center in Causeway Bay next week.

“The store will be our only flagship in Hong Kong and Macau. It is our biggest investment of the year,” Lam said. “We have also worked with two non-profit organizations to release a book about preserving Cantonese cuisine to deepen community connection.”

These days, property agents share a private joke: new housing projects equipped with Miele appliances can command a higher premium.

And when property developers organize show flat tours, as evidenced by the four recent residential sites in Ho Man Tin and Kai Tak, they do not shy away from highlighting the German label in their sales pitch.

“The wholesale market has grown quite substantially over the past 10 years. Residence Bel-air in Cyberport was the first large-scale, top-end project — not at The Peak, or in Clearwater Bay and Kowloon Tong — to equip their kitchens with our appliances,” Lam said.

“The Austin in Jordan set a record for installing the most Miele appliances. The developer ordered around 13,000 items for two blocks, using our full range.”

“That record will be broken by a new residential project in Macau. I cannot tell you which one as it hasn’t gone on sale. The demand in Macau is growing at an even faster pace. Developers believe that branded appliances add value to their properties.”

Despite their higher price tag, built-in home appliances are not a luxury any more. More families choose to replace the wok and microwave with a steam oven. The item is a source of pride for Lam as he helped modernize and popularize the concept in Asia.

The first generation of steam ovens, the DG160, had a steel tray on which one could put only a morsel of food. It could not meet the needs of Cantonese families for cooking a whole fish or a plate of meat patty.

Lam pressured Miele headquarters to develop one with a larger cavity. The steam ovens sold today can cook rice and several dishes simultaneously, saving time and making sure the food is still hot when served.

Lam was also the first person to introduce free-standing steam ovens to local customers whose kitchens often are not big enough to hold a built-in one. Miele now offers the most varied range of steam ovens on the market.

Lam has now two goals: to find the perfect steamed fish recipe and to grow a team to look after an expanding market.

“The team started off with eight employees. A repairman, a marketing officer who has moved to a regional managing director role, and I are still with the company. We used to do everything ourselves. But as managers, we have to know when to delegate,” he said.

“We now have 120 office staff and 50 or so front-line sales representatives. The real challenge is how to make people in a large team feel they are progressing professionally.”

The article first appeared in the Standard on June 30, 2017.

Right At Home

Why this Kiwi accountant was fated to become the head of an expanding houseware distributor in Hong Kong

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The six degrees of separation theory contends that anyone on the planet can be linked to any other person with just six introductions. It’s a simpler cobweb to trace how two strangers, Suresh Kanji and Ravi Gidumal, were connected to each other.

Kanji was an accountant from New Zealand before he met Gidumal, a Hong Kong-born Indian businessman operating Town House, a houseware and giftware distributor founded by his mother Mohini Gidumal in 1962.

The two had never had any business dealings with each other. Kanji, a Wellington native, didn’t even know Gidumal existed before they met. Interestingly, they shared two mutual connections – which turned out to be two important women in Gidumal’s life.

The first was Gidumal’s sister Anita. Kanji met her during a 10-week business trip to Hong Kong in 1994. They both used to work at the accounting firm PricewaterhouseCoopers. Four years later, Kanji met the second connection through work again.

“I moved to Hong Kong in March 1998. At that time, the company would send a staff member out to the airport to welcome you and show you around,” he recalled. “That was Shalini Mahtani.” Mahtani, whose grandfather is George Harilela, is Gidumal’s better half.

Despite that, Kanji and Gidumal met by chance – during a Christmas party.

“Anita invited me to her parent’s house for my first Christmas in Hong Kong. Ravi just happened to turn up on Christmas Day,” recalled Kanji. “Ravi and Shalini did not have any romantic relationship yet at the time. I wasn’t their matchmaker.”

The two later became good friends and discovered common interests: squash and wine tasting. Still in New Zealand, Kanji would often travel to his favorite vineyard Villa Maria in Marlborough and Mission Estate in Hawke’s Bay. He even went on a wine tour in Bordeaux for his honeymoon.

In 1999, Gidumal invited Kanji to a tasting event. He had started distributing Riedel’s stemware in Hong Kong and wanted his friend’s opinions on the varietal-specific wine glasses.

“I have never ever heard of such a thing as glass tasting. A glass is a glass,” recalled Kanji. “We sat down and we did the first wine, an ordinary sauvignon blanc. We tried it in a Riedel glass and non-Riedel glass.”

“When I first tasted it from a Riedel glass, I thought it was quite a nice wine. The flavors and the acidity were balanced with sweetness. But when we tried it in a non-Riedel glass, the wine was really average. It was bitter, overly acidic.”

“I was amazed. And then we moved onto chardonnay, pinot noir, cabernet. I turned from being skeptical to ‘Wow! That is the most incredible thing I’ve ever been to.'”

Gidumal converted Kanji into a Riedel believer. In 2012, he invited Kanji to help him expand the business. Kanji is now the general manager of Town House.

Town House is now also engaged in the wholesale business, selling to hotels and restaurants. Its wholesale operations are actually bigger now than its retail business.

In its retail operations, Town House opened a second stand-alone store at K11 shopping mall in Tsim Sha Tsui in November. It has also expanded, since June, retail premises that it is operating in department stores. In Sogo in Causeway Bay, Town House has expanded almost fivefold the size of its retail shop. In Wing On department store in Sheung Wan, Town House also expanded its one-pillar shop to a proper shop-in-shop.

“Our performance in department stores has been solid. We are not as adversely affected as other retail companies by the slowdown in the local retail industry,” said Kanji. “It is very hard to get into department stores and space is at a premium. The fact that we’ve been able to expand is a testament to our product mix being right,” he said.

Last month, Town House signed with Alessi an agreement for the retailer to distribute the latter’s products in Hong Kong. The deal added to its portfolio of high-profile brands, which include Riedel, Maxwell & Williams, Nachtmann, Carrs Silverware and Britto.

“The design and range of Alessi products is vast. But it fits into our home and gift category quite well,” said Kanji. “One of the things that Ravi has always insisted on is a wide product range. Town House is a destination for buying gifts, for buying something for yourself, and which is not necessarily expensive.”

The article first appeared in the Standard on August 12, 2016.