Key to Starbucks' Drinkware Green Sustainable Success

Chien  0:05  
Hello, everyone. Thanks for joining us for another episode of Spark Your Vision, a podcast where we discuss the latest trends in business, as well as inviting business leaders across various industries to share with us their experiences, as well as their insights. My name is Chien, and along with my partner here today, Alice will be hosting today's show.

Alice  0:30  
Hi, everyone, I'm Alice.

Chien  0:32  
And so today, everyone is in a treat. In for a treat, actually we've invited Andrew Chen, CEO of Woodmax, one of the top drinkware manufacturers in the world to share with us how Woodmax successfully not only cope with the pandemic, which we've gone through for this past two and a half years but also at the same time post-pandemic wise, you know, especially with the latest trends and sustainability and ESG, how that trend will affect business moving forward.

Well, Andrew, we we known each other for a while, we have many, many similar backgrounds. So to be honest, I think we could probably talk forever, you know, not just this next 15 or 20 minutes, but it's good to have you here today on the show. Do you want to give a brief pitch elevator speech of what Woodmax you know, in terms of business to introduce to the listeners,

Andrew  1:30  
Sure Woodmax is a calculated, 37-year-old company, and it's a family-owned business. We started back in year 1985 as a trading company. And during that time, there's a boom in manufacturing in Taiwan. So my father rode that wave, we were able to export merchandise worldwide. And that's how the background of what Woodmax. And later on, we began working with several brand-name companies in the United States, namely Costco, Reader's Digest, and Starbucks. And right now, we are the key suppliers of Starbucks.

Chien  2:09  
Thanks for the introduction. You know, before we get into some of the trends and business, I'm just very curious about some of the behind-the-scenes in terms of business because, you know, obviously, he is the second generation in a family business. And furthermore, our backgrounds very similar, because we grew up in the States as well, right. So I'm pretty sure there was a lot of challenges, even difficulties in terms of the cultural background. I mean, you share with us, you know, that experience.

Andrew  2:33  
I was born in Taiwan, in Taitung. My youth I spent in, in in the states. I moved back to Taiwan in early 2013, with my wife and two kids, but now I have three so so I had a kid here. At the time, I decided to come back to take over the business, because I just want to help my father and also expand with Woodmax. So that's why I moved back, gosh, like nine years ago. So at the time, it was a bit difficult, because I had to come back here and learn everything anew.

My wife gave me a lot of support in you know, taking care of my daughters, and then keeping the home sane, I guess. And then also learning the entire supply chain, from the ground up was also another challenge, because for the first two years, I travel a lot in China, different provinces, visiting factories, old and new, and also learning how things are made. But also we need to control costs, and then also build relationships with our suppliers. So those are the starting point of the first two years of my learning years in Taiwan.

Chien  3:47  
Yeah, I noticed you started out with family, which I think is a very important part of you. And it's very important to have that work-life balance as well, as you mentioned. You know, just out of curiosity, I mean, you and your father, obviously are the core figure of Woodmax, and I'm pretty sure sometimes decisions has to be made. There might be some conflicts or, you know, different interests, or, you know, how do you guys overcome? Or how do you guys, you know, delegate the  decisions? And how do you guys come across, you know, like agreements

Andrew  4:14  
Took me a while to actually think about how I work with my father, because he had a say in almost everything. In finance, HR. And so like sales, he took charge of the finance part, that is something that I don't touch, you know, that's a very sensitive area. We had agreement that I need to build my team. So I had a say in building my own team and also divide up according to what I envision in the future. So which was great, because right now, our team is really cohesive and really efficient.

We consider my father like number one salesman. In the beginning, I work with him,  I try to be like humbled and then learn. In terms of family business, it's all about how I prove myself to him. I had to prove to my father that I can gradually take over department by department, the sales that I hire, were able to outperform his expectations, and also the design team that higher design something that the customer liked. And they also can outgrow the original design team. So in order to earn more responsibilities, I just have to prove myself, which I had his blessing.

Chien  5:24  
And you started out with good genes too, right? Because he is, yeah, like you said, he's a good salesman, right? So you got some of that from him. And then the learning process, it's more about doing an action and showing results. And so, you know, we wanted to start out with the lighter side. And now let's get into some of the business stuff.

COVID-19, it really struck us and you know, was a curveball for all of the businesses, no one was expecting this, and how has, you know, these past two and a half years affected Woodmax. And furthermore, you know, with a lot of the borders opening up, and it looks like we're entering the new normal now. Right? So hopefully soon, how are we, you know, prepared for moving forward? And, you know, even maybe, going back to some of the marketing activities that we did before, whether it be through physical events or online, you know, what, yeah, what's your take on that?

Andrew  6:14  
Well, during the two and a half year of this pandemic period, we took a dive in terms of sales, because pandemic is happening worldwide. So we see the trend that we started getting cancel orders from different countries, different continents. But later on, when the virus started spreading to Europe, in the States, it was when the manufacturers factories start, reinstated, you know, start pumping out like catching up. But then the rest of the world is suffering from the pandemic. In the beginning in sort of like a manufacturing interruption. And then later on, we had canceled orders. During those two and a half years, we had to not only deal with the quality and delivery time, we had to deal with air freight, or the ocean freight shortages, we had to deal with cost increase, we had to d eal with cancel orders and things. So everything got really, really, really complicated.

So I spent a lot of money on conferencing systems. And we started making meeting more fun, you know, not not just like another meeting after meetings. So actually, our clients were they wanted to meet with this. And then they they wanted to see what other interesting topic or some interesting samples that we can show it to them. So having those experience, let's say, if there's something coming up, we already have procedures to meet with our clients through video conferencing. Now the border opens up, we just had a team visiting Korea and Japan. And our clients were so happy because we were the first supplier that visited. So we had a great time, we learned how to cope with this pandemic. And then we had to put our put our minds together to make everything fun and make all the meetings not a boring meet. Those are the key takeaways to make our relationship going with our client.

Chien  8:07  
Yeah, thanks for sharing. I mean, definitely, I think one of the I guess that's one of the advantages, right, the few advantages that we're able to take from the pandemic, because of the process, you guys were able to digitally transform and furthermore, from a marketing perspective, be more creative and hopefully moving forward, whether it be post-pandemic or whatever, right, yeah, you are able to offer your customers different experiences. And hopefully that will give you an advantage over other rivalry competitors, I think.

Andrew  8:34  
Yeah, yeah, you're absolutely right. The last two years has been a very challenging, but yet a lot of different experience in how to solve problems and problems that you would never think would happen in your lifetime.

Chien  8:34  
So hopefully, it doesn't happen again.

Andrew  8:48  
Hopefully, hopefully. Probably. Yeah, hopefully another 100 years.

Chien  8:53  
No, definitely not in our lifetimes.

Andrew  8:54  
Yeah, not in our lifetimes. Hopefully, hopefully, fingers crossed. Yeah.

Chien  8:57  
Okay. So let's, you know, one of our topics today is definitely on sustainability and ESG. Right.

Alice  9:04  
So, as you just mentioned that your Woodmax is the key manufacturer of Starbucks. Actually, Starbucks has a new policy last year in 2021. They actually roll out a policy that which they encourage people to bring their own cup, or use reusable cup, because they aim to reduce their waste. We would like to know about your opinion on that.

Andrew  9:29  
I think they want to reduce the carbon footprint by 50% in 2035, I believe or, yeah. Since we are a supplier of Starbucks for the last 20 some years, when when the shopper continued to use the single use cups, paper cup or plastic cup. It really really affected the environment no matter how well the recycled process is, you know, making those cups is also adding carbon footprint. But since it's a global company, different government have different policies. What I truly believe is that, with that policy, working with private sectors, that transformation, in my opinion, a more immediate.

European Union, they're very fast in terms of implementing policies that can reduce carbon footprint, I really hope that the rest of the world can also see this as an opportunity to really quickly turn our consumer behavior around. Being a supplier of Starbucks, it's great that Starbucks is implementing this policy, it'll be much helpful that every country sees this effort, and then just go along with it. And then having the policy revise up-to-date, start shifting the consumer behavior.

Alice  10:58  
The trending topic about ESG, environmental, social and governance. So we would like to know how Woodmax sees on this topic.

Andrew  11:09  
In order to implement ESG, we begin to have team to learn how to calculate carbon footprint in terms of different materials, we will we want to be the role that can assist these factories, to go through that transition to share some knowledge with the factories. I think these are the some of the ways that Woodmax can become and then also helping the factories to transition. Yeah,

Alice  11:36  
We also see on Woodmax website you guys mentioned about CSR, corporate social responsibility, and especially on education in remote areas, is there a special reason?

Andrew  11:50  
My father believes that education can help the kids to get out of poverty. So that's why we really focus on education, but without education, basically, they have no no options.

Chien  12:03  
Yeah. Sustainability. It sounds like as a key topic for Woodmax and internally. How does Woodmax you know, ensure sustainability in its design and production process? You know, that is one thing that maybe you can share with us. And then also, Starbucks is definitely one of your key customers, how do you help your global customers achieve sustainability, and if you have any specific cases you can share with us? Yeah.

Andrew  12:25  
In order to have a sustainable brand, quality is everything. And then the process is everything. So I think having a specific sales team, design team and quality team that can really help customer design products from the ground up. And then also in the process, monitoring every little details to make sure that manufacturing process can turn out to be good quality, and then also safe to use. Those processes are what I focus on right now. When we propose something that is brand new, that is patentable, we focus on structures of item, the aesthetics, and then also the usability of a design. So before that, we would have internal discussion about what type of functionality we want to implement, and how safe this functionality and how well designed or if this design can actually solve problem. So those are the internal meetings that we had to go through those will take about maybe weeks, just to come up with that particular design.

Once we have that firm confirmation from the quality team and also from the design team, then we put that design together to propose it to our customers as an OEM manufacturer, sometimes customer they only have an idea, but we have to make that idea into an actual product. So that internal meeting basically bridges the gap between a concept also into a reality. So So that process is something that very important element in an ODM process. We call it new product introductions. So it's a NPI introduction to make sure that if the customer select this design, it is already a ready to mass produced design.

Chien  14:21  
So I mean to your customers, I think you're not only just a manufacturer, you're really their partners in terms of you know, that new product introduction, and especially, you know, with what we just mentioned, you know, some of the sustainability trends and all that stuff. I think you're also helping them providing the necessary experience and support to help them achieve that. Right.

So Starbucks obviously is one of your key accounts. And I think from that experience alone, I think you've accumulated a lot of the necessary experiences, how would something like that applied to potentially to another industry

Andrew  14:57  
We wanted to leverage this experience into a different industry and we just thought that, hey, maybe fashion industry apparel industry can also use our services because apparel industry is always about trend. And it's always about what are some of the new new categories that we can introduce.

Earlier, we just discussed about sustainability, like how do we reduce waste, and I just thought combining, you know, like the tumblers or water bottles, and then design them into into a very and trendsetting designs. Also we promote sustainability in in a fashion type of way. Combining fashion with our services will be a good match in the current setting.

Chien  15:45  
That's quite interesting making almost drinkware a fashionable statement.

Andrew  15:49  

Chien  15:50  
To some extent. Yeah, right. That's good. That's good. Yeah.

Alice  15:52  
Is there any new project that you would like to share with us?

Andrew  15:57  
Yeah, well, two things. The first is, of course, I want to promote NGO partners ICF, its international NGO that's located in Cambodia, we've been working with them for the past five years, they basically help with the less privileged kids, provide them with like after class education, and also medication. And most importantly, during the pandemic, they were able to assist a lot of families to get back up, I think, Cambodia, their main source of income were probably 95%, all depending on traveling. So having pandemic that caused all the shops to close down, restaurants and service industry to close down a lot of families, they also became poor. So ICF also helped these families to learn new skills, they really, really not only help the kids, but they also help the family to get back up during the pandemic.

So I want to promote this NGO and hoping that if there are more corporations that's willing to look into this, NGOs, you can check out their website, it's ICF cambodia.com. And this is one of the water bottles that we support the kids this is a aluminum bottle, because they built their own water filtration system in on the campus. So the villagers can actually come and get fresh water for their drinking or for their homes for free. And we support the kids with a couple 1000 of them so that when they are on campus, it can pack up water for their school. So this is something that we support the NGOs last year, and this year will we are doing something different. So every year we'll have different products that we donated to the kids.

And then the secondly would be we're also developing a lot of drinkware using compostable materials, and this one is made out of PLA. In Japan, it's acceptable, it's degradable. And we were also looking into other materials that we can leverage to make compostable cups not only you can reuse them. After the lifecycle, it'll just decompose disappear. So I think that's also another way that we can help the brand to develop these types of product also promote sustainability. In the future, we have this type of materials that we can make into drink wares or, or into different types of merchandise.

Chien  18:24  
While so today, it's been an honor to be able to invite Andrew on the show today to share with us his insights as well as some of the key to Woodmax's success, I think And then furthermore, you know definitely looking forward to visiting Starbucks more often right looking forward the some of the newest up and coming drinkwares in terms of some of these sustainability trends, especially in fashion, I think,.

Hopefully, down the road. Very soon we'll be able to see a lot of these fashion brands to be able to include drinkwares as one of the their, their their additional accessories, I think, yeah, millennials might be able to afford that and furthermore be able to carry that around. Right. So I think that's a definitely a good plus. But anyway, thanks for sharing and coming on the show today. Please do continue to either follow our podcast, you know, Spark Your Vision, but also at the same time to check out when Woodmax's LinkedIn profile, you know, to continue to follow some of the news as well as today's episode will be released. Once again. Thanks for coming on the show. And it's always good to have to see you in person.

Andrew  19:34  
Yeah, thank you so much for having me here. And it's great. I had a great time.

Chien  19:38  
Thank you, Andrew.

Andrew  19:39  

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