Behind success, tribulations
Bob Yen, chairman of the IDP Group, and Kenny Lee, president director of Lezen Indonesia, came to Surabaya to invest in new factories there at about the same time. Both had to overcome many trials and tribulations to achieve success, and both have given their all to Subaraya’s development.
Inside the IDP factory building, we see racks filled with a display of exquisite paper bags marked with the names of European designer brands such as Chanel, Prada, and Gucci—all of which came off IDP’s production lines. In another place are hung four clocks showing the times in Indonesia, China, New York, and the UK, clearly indicating the global domain Yen has built for himself, all starting from a foothold in Indonesia.
Before going to Indonesia, Yen ran a trading company. Later, in response to a request from a client in the UK, he began making small batches of paper bags (mostly for use in wrapping gifts), which are not difficult to manufacture. He sold them into the UK and other locations.
At that time Yen’s small factory in New Taipei City’s Xindian had only 30 employees, but its labor-intensive form of production meant that it came under pressure from the appreciation of the NT dollar and Taiwan’s sharply rising wage costs. After visiting mainland China and several Southeast-Asian countries, Yen found the investment environment in Indonesia to be more stable than in the other locations, so in 1991 he came to build a factory in Surabaya.
Not long after the factory was built, the Asian financial crisis occurred. IDP, which specializes in selling to overseas markets, was one of the very few firms to make a profit out of it. This was because production costs plummeted due to the huge depreciation of the Indonesian currency, the rupiah.
In 2000 IDP expanded its territory beyond Indonesia, as Yen decided to build a factory in Suzhou, mainland China. Later he also opened offices in the UK and the US. Today IDP employs 800 people, and produces hundreds of types of bags, on its 3.6-hectare factory site in Indonesia.
When you walk into the factory belonging to Lezen Indonesia that Kenny Lee built up single-handedly, the products displayed on shelves are instead pair after pair of men’s and women’s fashionable leisure shoes.
The starting point of Lee’s story in Indonesia is similar to that of the great majority of Taiwanese businesspeople. Before coming to Indonesia, Lee had a small shoe factory in Taiwan, and sold most of his products abroad. He similarly felt the twin pressures of an appreciating NT dollar and rising wages in Taiwan, so he went on fact-finding trips to mainland China and Southeast Asia. Lee eventually decided to set up a factory in mainland China, but then the Tiananmen Incident occurred, so at the recommendation of some friends he turned to Surabaya to build his factory.
“At that time, Taiwanese businesspeople all came here single-handedly. The pain behind the success that others see, and the suffering that is not easily expressed, all had to be endured alone in a foreign land,” says Lee.
In 2001, Lee’s company faced a crisis of customers withdrawing orders. This was because his company mainly produced shoes for American golfing brands, and after 911, American customers felt qualms about Muslim countries, and were not willing to give orders to a company that was located in one. The company’s business was greatly affected, but fortunately, through an introduction by a friend, he was able to make up the shortage of orders.
With the rapid development of the Indonesian economy, the land in the Ngoro Industrial Park has sold out.