Bernie Liu on Penshoppe: It’s Moore than just a shirt

Bernie Liu, president and CEO of Golden ABC, the mother company of the fashion and lifestyle brand Penshoppe, is on the edge of his seat these days. "This is really a marketing test," he says, referring to the recent choice of their endorser, pop teen sensation and Hollywood star Mandy Moore. Then he smiles, "Sana it works."

It’s no joke to gamble if the stakes are this high considering not only the tab (which we’re sure is enormous) but also the amount of time, effort, and energy of several people whose consolidated efforts will be put to a test. But Bernie, although seemingly very meek and mild in his demeanor, is dead serious in sending out his message.

In the midst of Penshoppe’s biggest and boldest marketing effort ever, Bernie shares how he turned a mere T-shirt company into a 300-store company, and imparts his thoughts on risk-taking, growth, people empowerment, and the importance of giving back to the community.

Excerpts:

Philippine STAR: How important is marketing in your business?

Bernie Liu: Marketing is very important but it takes a whole lot of other things to make something work. Your marketing campaign can be so dynamic but if you have a really weak backbone, that’ll spell disaster. Marketing is being able to communicate externally who we are and what we are doing. But internal is also important so we put equal emphasis on store operations, logistics, and human resources.

With Mandy Moore as Penshoppe’s newest endorser, do you feel you just waged an endorsement war against your competition?

We did this to create more excitement for the brand, not because we wanted to brag or show off to our competition. The rivalry is actually good because it raises the standard on how to serve the consumers. It pushes companies to be better. If we really want to be recognized as a country that has an international capability to go global, then we should really raise our standards. What’s happening to the market today is good for the industry and the country. I’ve traveled a lot and I’ve seen how other companies around the world have grown. And I say to myself, we can do that.

How do you choose an endorser?

There has to be a character and personality. We were never obsessed with big names. In fact our first bunch of Club Pen models weren’t really known. And we really discovered them like Ryan Agoncillo and Paolo Bediones. But times change and competition gets tougher, so we have to adapt. We saw that Cogie Domingo had good potential so we developed him. And now, Mandy Moore. More than just a beautiful face and figure, what’s also important is to find a right fit. Penshoppe is fun, youthful, and wholesome. And that’s exactly what Mandy is like. We have never projected the brand to be cutting edge or sexy. I’ve always said it’s cool to be good. That’s the character of the brand.

How did you get Mandy Moore to endorse Penshoppe?

Mandy Moore was godsend to us. We were looking for something that would create noise for the brand. We wanted something to send the message that we want to be bolder, bigger, and better, aligned with our expansion in China. Then the opportunity came. The first thing that sucked us was the character of Mandy. She was perfect for the brand. She’s dynamic and vibrant. And I’m confident that we did not make a mistake. She’s been very professional and easy to work with. This is a major production. We were concerned about the cost, not to mention bringing everyone to Los Angeles for the shoots. But she made it all worth it. I always say, you have to spend money to earn money.

How did Penshoppe start?

We started as a T-shirt company. My mom Norma had a small garment company that was actually in partnership with some friends in Manila and they decided to bring it to Cebu because my mom’s from there. They used to make commercial T-shirts, the ones you give away during Christmas. That kind of business is not very lucrative and regular since it has a very limited peak season. So we decided to create a brand that would be able to sustain our business. I gathered a couple of friends to develop a private label. It started in 1986. I graduated college in 1984. I’m an architect by profession. I went and helped the lumber business of the family in Manila for a year. But my interest was always in the arts. Building houses is an art but when the opportunity came for me to help my mom in the business and my group of friends gathered together, it seemed very attractive to do.

How were your first few years in business?

We were all young and single boys. All batch mates, architecture students, and barkada. We would work nights because everyone had a day job. So it was like we were playing. This business was a sideline for all of us. It started as laro-laro lang. Eventually it became a full-time job for most of us. We started with a lot of graphic and printed shirts, which is how we best expressed our creativity then. Like everything else, it evolved to become a lifestyle marketing company.

What were the difficulties?

It was difficult in the beginning because we did not have the background and training. But when you’re young, you take more risks and you’re more daring. We had to learn everything from scratch – advertising, merchandising, store operations. And in the first five years, it would’ve been so easy to give up. Honestly, we were losing money. We weren’t even near break-even. In hindsight, we could have just said, "This is something we didn’t want to get into." We were having a lot of bad merchandise. We were having problems marketing the brand. We didn’t know anything about advertising. We were all architects. But back then, the stakes weren’t as high as they are now. We were bold and daring so the business was sustained. Of course the support of the family was there because they saw how much we loved what we were doing. Eventually, it paid off.

Who inspires you in business?

I grew up in a family of entrepreneurs. My dad Lim was a jeepney driver during the war in Cagayan de Oro. He had to support a family of eight siblings. My dad never finished formal education. He worked for several companies and had to work very hard to sustain and support the family. My mom was behind him during those trying years. I saw the difficulties and hardships they went through for the sake of the children so that imbibed in me the culture of hard work, determination, dedication. Going through high school and college, we had to work during summers. We were taught the value of money. We were never spoiled. When I was growing up, the family’s lumber business was just starting so I really saw the difficult times. And I said to myself if my dad could put up something like this without formal education, how much more for me who was able to finish college. Sheer determination and inspiration I got from my parents alone, I think drove me to excel in my field.

Were they strict?

We grew up in a very disciplined and strict environment. Not that we were deprived. We were never deprived. They gave us what we needed; not necessarily what we wanted. But then again, we saw how sincere they were. Family time was never compromised. Every Saturday night, we watched movies. And it helped that we were brought up in a very religious environment. My mom always feels that we are only disciples here and everything is borrowed. We all have our own talents and we must share those talents. My dad would always say, even if the company is not making money, the sight of being able to provide people the avenue to share their talents should be enough reward. Of course the importance of reputation and credibility should not be taken for granted.

How do you handle competition?

In any market place and free enterprise, there will always be competition. But I believe there is enough for everyone. There are no monopolies of ideas. I never believed in monopoly because in doing so, you are depriving the consumers of choices. You just have to take competition in stride. Just don’t be too emotional about it. At the end of the day, it’s a matter of how you cope and strategize to be able to stay in the market; and to be able to grow and help the industry. In this fast-paced world of ours, you always have to be unique and different. You always have to aspire for something better.

What do you think is your greatest achievement in business?

It’s a continuing journey. At least I can say, we’ve made a difference. From where we were, we brought the brand to a national level. From 40 employees when we started, we are now 1,600 and we have 300 shops and shops in stores. Bringing Penshoppe to China is my gift to my parents. My dad came from Xiamen. When we opened our first shop in Xiamen, I brought my parents there. It’s like a son’s tribute to his dad. It was an emotional moment for us because my father left Xiamen to seek a better life for his family. Now we brought him back.

What business philosophy do you live by?

We must always challenge ourselves so we can be better and bigger; and bring our company to greater heights. When we were starting, I used to think to myself how we would be if we had 100 stores. I was telling myself, "Gosh, that would be the day. I will rejoice and be so happy with 100 stores." But like everything else, that came to pass. Now I’m thinking how it would be when we reach 1,000 shops. But it’ll come to pass someday and we will aim to be better. As we expand our business, we also wish we could extend the same opportunities to a lot of our people as well. I’ve seen a lot of people in our company grow with us. They have matured personally and professionally. And that’s a reward.

Have you made a lot of business mistakes?

In business, if you don’t take risks, there’s no glory. No pain, no gain. We’ve made a lot of mistakes like thousands of bad merchandise and wrong marketing campaigns. Two years ago, I had to pull out our children’s line. Not because there was no market for it, we just weren’t ready. Every month and year, there are realizations.

What is your definition of success?

Being able to see that the organization is better today than it was then in terms of opportunities for people, business growth, and impact to our market – if we made their lives better, that is. Definitely the engine of growth is profit and at the end of the day it’s that profit that justifies if we are able to provide for the shareholders. We’re not saying we’re making Penshoppe into a charitable institution but at least provide development and growth for everyone. As long as we’re able to keep that balance then we’re okay. I don’t want to be very profitable yet be shrewd. Profit alone is not the only measure of success. It’s a driver to be able to continue growing, but it’ll never be the only determinant. You have to have that social responsibility as a corporate citizen. The market has been very kind to us. We must be able to share that to others as well.

You work with your wife, which a lot of businessmen find hard to do.

It starts with a good foundation. Alice and I call each other soul mates. We’re so used to being together that she’s become my best friend and mentor. When you feel so attached to a person, you can’t imagine being away from each other. We’ve had our arguments, but if the foundation is strong and the love for each other is really there, through thick and thin, things will be fine. Working together has actually helped the marriage. I could not say it’ll work for everyone. But we complement each other.

What type of boss are you?

In business, I always try to make the system participative. Being its head, I don’t deny that the buck stops here. I’m accountable for the whole organization. But we instill the entrepreneurial spirit in everyone. There is a sense of ownership. If we do good, everything is shared with everyone. Technology has been able to help us communicate with everyone in the company but at the same time they communicate all the way to the top. And we’re very transparent. In a professional environment, there must be transparency, sincerity, and fairness.

Are you a hands-on leader?

I try to be updated. I actually empower my people so much. In fact I kid them often than they make decisions and I’m always the last to know. I just make sure that before we empower someone, we have to make sure he or she is competent. Empowerment without competence can be disastrous.

How do you relax from your hectic business schedule?

I really look forward to weekends. I travel a lot but as much as possible we try to make time for our kids on weekends. We have three wonderful kids – Bryan, Brandon and Mandy. Family time is my relaxation time.

What do you spend on? How do you enjoy the money you worked hard for?

I’m a very simple person. People always tell me to buy a new car or watch. But to me, as long as something is functional, it’s okay. I don’t mind wearing old things. Of course, I like clothes, that’s why I’m in this business. I also spend for traveling. I make it a point that I have a two-week vacation every year with the family. That’s a non-negotiable deal.

What’s your business formula or secret to success?

It all begins with a dynamic organization. You have to have the right people with the right values. That’s the core of our business. In our company, we have core values which we live by and which dictate the character of our organization so that everyone knows who we are. Strategy cannot work without the proper people enacting them. Some people have brilliant ideas but they cannot execute them simply because the organization is not prepared well. Aligning everything is also very important. Everything must be very consistent.

How is the economy affecting your retail business?

Business is long term. I don’t work for the now. The market is always there. My dad would always say there’s no such thing as bad economy. It’s how you manage your business. It’s either you manage well or poorly. The economy will always have its highs and lows.

What’s the best advice you could give to aspiring entrepreneurs?

You must love what you’re doing. At the end of the day, you must have fun and you must be happy. You should know what you want and how you’d get there. And that will all translate to: Are you happy? Because if not, it’s always going to be a struggle. Even waking up in the morning will be so heavy. You dread going to work. Life is too short to let it pass you by. Also, as an entrepreneur, you need investment and capital. But if you have good ideas and passion, then the market is out there waiting. You just have to know if you’re having fun because that will spell out your endurance. You don’t build an organization for just being there for a couple of years. You have to be patient and persevere. And that’s what I’ve been able to do for Penshoppe. And if I did it right, Penshoppe should be able to outlive its founder. It should also be able to provide improvement to the lives of people the company affects. I want to be able to look back and say I was instrumental in building something and I shared the blessings with others.