From Acquisition to Integration , FFG created a diversified business conglomerate and is heading toward becoming the world's largest machine tool brand
FFG was founded in 1979 as an agent for a Japanese steel and construction machinery company. In 1984, FFG started its manufacturing business. In 1985, FFG established machine tool department and started manufacturing. Through M&A and integration, FFG became the biggest CNC machine tool group in the Greater China Region. Currently, FFG has 96 companies in the world, two of which are publicly traded in Taiwan Stock Exchange and one is publicly traded in Hong Kong Stock Exchange. FFG's business covers Machine Tool Division, Industry Equipment Division, and Green Energy Division. Among these divisions, Machine Tool Division plays the most important role which contributes to more than 40% of the revenue.
Chairman Mr. Chu said confidently that FFG maintains a good operation and financial condition. In order to pursuit maximum returns for customers and employees and reduce the operation cost, FFG would never merger easily by loans to expand the group scale.
In recently years, the rapid changes of industry and depression made a lot of enterprises on the verge of bankruptcy or liquidation crisis. FFG, however, regards"customer"and"employee"as the core value of the business. FFG associates with high corporate mergers and acquisitions through unique vision and keep the original work team and the staffs of the merged enterprise. Many enterprises that faced bankruptcy were turned into profit by FFG's production management and business structure adjustment. Moreover, FFG would not resell the enterprises easily because this is also a responsible and sincere attitude to customers and employees.
With the philosophy of FFG"Ernest and Responsibility Sustained Operation”, Mr. Chu stressed FFG's strategy is to take merger integration to retain corporate talent and brand. It takes a lot of time and cost to establish brands, distribution channel and businesses. Moreover, only interdisciplinary talents from various fields can make merger &acquisition plans move forward and obtain more brands in FFG. Therefore, Mr. Chu is known as"The king of merger & acquisition”,"merger & acquisition magician"in the industry.
Mr. Chu takes FFG's machine tool division as an example. Machine tool division has 37 brands and 50 manufactory bases around the world. Through the local management system, they have established coherence within enterprises. Mr. Chu stressed that the brands of FFG have market segmentation externally and with mutual cooperation internally to achieve diversification.
Through the integration of machine tool manufacturing enterprises and the combination of talent, R & D, equipment and marketing, FFG realized the complementary advantages of product resource and various enterprises to meet the needs of different customers. The integration includes machine tool division, industry equipment division, and green energy division to maximize the benefit of the group.
FFG expands globally and set up production bases worldwide with success in local manufacture and marketing. China has a huge domestic market and became the world's biggest consumer of machine tool. China consumes 1/3 of the world's machine tool production and the turnover of one province equals that of one single country. So, FFG's strategy in mainland is to operate the business in the 30 provinces as if it is 30 countries.
Although the current price of raw materials has risen, fluctuant international exchange compressed profit space, FFG still succeeds in reducing cost and obtaining stable profit by reducing inventory with suppliers and improve production management. On the layout of the future development, Mr. Chu stressed that talent is still the key to success of the enterprise. FFG's cooperation with Hangzhou vocational and technical college to set up Fair Friend Institute of Electromechanics which can educate and develop 500 professional talents to meet the needs of business every year. Moreover, Fair Friend Institute of Electromechanics is a part of the Group's business and is included in the Group's overall planning and development strategy of globalization.
On the other hand, FFG is planning to enter the growing green energy market (such as solar conductive adhesive, LED lighting and other green energy industry, etc.) through acquisitions and joint venture and make green energy division as one of the main business division together with machine tool division, PCB division and electronic division. In the automobile market, FFG is one of 7 enterprises in the world that is approved by the automobile factory as a supplier for turnkey factory. FFG is also the only enterprise in the Greater China Region that received this approval.
FFG expands global market pragmatically. In the future, FFG will continue to expand machine tool enterprises in Europe, South Korea and India, etc. through M & A. Also, FFG will expand factory in Xiasha Industrial Campus and Jiangdong Industrial Campus. Mr. Chu and FFG will never stop on the road to excel and FFG's brand will become No. 1 in the world can be expected.