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Love for gold and jewellery drove pawnbroker to success
by Rachel Scully, 21/10/2013
One of Singapore's largest pawnbroking chains, ValueMax, notched up revenues of $509 million last year under the leadership of founder Yeah Hiang Nam.
Eclipsing the half-billion-dollar mark shows just how far the business has come, with revenue soaring 27.8 per cent since 2010.
Pawnbroking may be regarded by some as a rather hard-nosed business, but ValueMax's success stems from Mr Yeah's love for jewellery and precious metals in a career spanning four decades.
The 17-outlet chain is now preparing for a mainboard listing on the Singapore Exchange. Last month, it lodged a preliminary prospectus with the Monetary Authority of Singapore.
If the listing goes through, it will be the third pawnbroker to go public, after Maxi-Cash Financial Services and MoneyMax Financial Services made their trading debuts on the Catalist board in the last 18 months.
"The listing will help in our expansion plans, be it to open or acquire pawn shops in Singapore and other countries," said Mr Yeah, 65.
ValueMax Group already operates five outlets in Malaysia through its associates.
Mr Yeah's business life can be divided into four parts, starting when the native Malaysian arrived in Singapore in 1965 and found work at a Chinese medicine hall.
After three years, a friend got him a sales job at a jewellery store, where he first developed his interest in precious adornments - and also met his wife.
"I spent 10 years there learning the ropes, like how to tell real and fake gems apart, what pieces were popular among customers as well as evaluating the worth of gold and jade," said Mr Yeah, the chief executive and managing director of ValueMax.
"I was intrigued by gold and jewellery ornaments."
The next phase began in 1979, when he decided to start his own business. With $10,000 of savings, he started producing gold accessories and jewellery.
"I could afford only a simple and basic gold cutting and moulding machine...
" I also roped in some relatives to help out at a small factory space I leased so that I could rely on people I trust."
Having sold jewellery for a decade, he knew what designs and styles would appeal to buyers.
Initially, his gold pieces were sold to local retail stores. But then, Mr Yeah realised there was demand for customised gold jewellery abroad, so he sought help to grow his business from the Economic Development Board.
With the agency's support, he secured a $400,000 bank loan to obtain more machinery and equipment for his gold manufacturing business.
"I was one of the first Singaporeans to export manufactured jewellery to Saudi Arabia and then to Dubai," he recalls.
"To operate there successfully, trustworthiness was key."
But as the Middle Eastern region started raising import duties, Mr Yeah sought business opportunities closer to home. He lived in Hong Kong and Malaysia for five years each in the late 1980s through to the 1990s.
"There was no difference between day or night in Hong Kong and orders could come in any time," explained Mr Yeah.
"What the customers and clients appreciated was speed - so you had to be fast when turning over their gold orders.
"So I beat the competition by turning around orders within a day, which allowed me to collect cash from our customers and keep our cashflow healthy."
In 1988, he made his first foray into pawnbroking. Mr Yeah and several partners pooled their resources and opened a pawn shop in Singapore, marking the third phase of his career.
"But I was still focused on growing the gold manufacturing business overseas and selling jewellery to other parts of Asia."
He eventually moved back to Singapore from Hong Kong and away from his gold-manufacturing business in 1999. This was because he foresaw the intense competition in gold manufacturing as China's economy was opening up.
That sparked the fourth phase of his career, as Mr Yeah focused on expanding the pawnbroking business here. After opening several standalone pawn shops, he launched the ValueMax brand and pushed for pawn shops to have a modern feel in 2004.
"The high counters and metal grilles made it intimidating for a customer who wanted to pawn an item for cash," he said.
"I thought: Why not make it look more welcoming by emulating the design of a jewellery store instead?"
And that vision shaped the look and image of the ValueMax pawn shop or retail store you see today.
The pawnbroking business has grown significantly in the past four years but recruiting talent is tough, said Mr Yeah.
Competition from rivals has also intensified, but there are still pockets of opportunities, he said.
Mr Yeah's succession plan for the business is well under way as he mentors two of his three children - Ms Yeah Lee Ching, 41 and Mr Steven Yeah, 34.
When asked about his retirement, Mr Yeah laughed and said his father-in-law had worked and kept active till he was 94.
"I'd prefer to help out in the business for as long as I can, as it's something I'm passionate about," he said. "Besides, it keeps my mind alert and active, which is better than having nothing to do."
In his spare time, however, Mr Yeah makes it a point to play with his six grandchildren.
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