Overview
This episode of "Brand Origins" covers the history of SM, the largest mall chain in the Philippines, focusing on the journey of founder Henry Sy from poverty in China to building a retail empire. The story highlights key milestones in Sy's life, the growth of SM from a small shoe store to a multi-industry conglomerate, and the lessons behind his success.
Henry Sy's Early Life and Migration
- Henry Sy was born in Xiamen, Fujian, China, into a poor family with his father working in Manila.
- At age 12, Sy traveled alone by sea to the Philippines, facing hardships including language barriers and food poisoning.
- Upon arrival, he found his father's store in poor condition and began working to help support the family.
Early Business Ventures and Education
- Sy helped run the family shoe store, performing tasks from calling customers to sleeping on the shop counter.
- He attended Anglo-Chinese School, finishing as valedictorian, and later began commerce studies at Far Eastern University.
- World War II destroyed their business, but Sy rebuilt by selling cigarettes and scrap metal after the war.
Establishing Shoe Mart and Innovation
- Sy partnered with Lao Kang to import and sell American shoes, leading to the opening of Plaza Shoe Store.
- He recruited Senen Mendiola as an accountant; together, they studied competitors and customer preferences.
- In 1958, Sy launched Shoe Mart (later SM), introducing innovations like air conditioning, fixed pricing, and hired attractive, trained staff for superior customer experience.
Expansion and Transformation to SM
- Sy dissolved partnerships to pursue a vision of expanding into department stores.
- He studied U.S. and European retail models, planning for a chain of 50+ stores and adapting Western best practices.
- In 1975, SM diversified beyond shoes, rebranding from Shoe Mart to SM and acquiring a small bank (Acme, later BDO).
The Era of Supermalls and National Growth
- SM Makati became the flagship store, shifting to a department store model and involving the Sy family in daily operations.
- Sy invested in developing Makati into a business district and expanded to more locations and products.
- In 1985, SM City North EDSA opened, overcoming skepticism and economic challenges to become the country's largest mall.
SM's Golden Age and Legacy
- SM went public in 1984, expanding nationwide and then internationally to China.
- By 2006, SM built the largest mall in Asia and currently owns four of the seven biggest malls in the region.
- SM diversified into banking and various industries, with over 72 malls in the Philippines and several in China as of 2019.
Key Lessons from Henry Sy
- Henry Sy’s success stemmed from perseverance, adaptability, and taking calculated risks during challenging times.
- Despite becoming the richest man in the Philippines, Sy’s journey emphasized hard work, learning from setbacks, and constant innovation.
Recommendations / Advice
- Never underestimate the value of hard work and resilience, especially in the face of uncertainty and adversity.
- Continuous learning and adapting best practices from successful models can lead to breakthrough growth.
Questions / Follow-Ups
- What are other examples of Filipino brands with similarly inspiring origin stories?
- How did SM adapt to the digital retail landscape in recent years?