THE BEGINNING

The VITASOY story began in 1940, with a big idea and a little bean.

The bean was soya - otherwise known as "the cow of China" - the main source of protein for the Chinese people for over several thousand years.

The big idea - the brainchild of Dr. K.S. Lo - was to take the cow of China and literally milk it.

At that time, diseases of malnutrition, such as pellagra and beri-beri. were widespread in Hong Kong. Dr. Lo's idea was to produce a nutritious, high-protein soyabean milk drink at a price people could afford.

The drink he created was VITASOY ... but it was not an immediate success.

EARLY DAYS

The Hongkong Soya Bean Products Co. Ltd. was opened on March 9, 1940. The factory located at Causeway Bay. In the open ceremony, Dr. Lo said,

"What is wanted in the colony to-day is a source of supply of nutritious food which is cheap enough to be within the reach of the masses; and , if we can meet a part of this urgent need, one of our main objects will have been achieved."

However good the idea may have been, VITASOY was not an immediate success. On the first day of business, only nine bottles were sold at six cents each.

Early Production of Vitasoy Soya Bean Milk

The product was delivered fresh door-to-door by boys on bicycles, and it had to be sold at once or it would spoil.

Business grew very slowly and, when the war ended production in 1941, sales were only about 1,000 bottles a day.

Relaunching VITASOY after the war was an act of faith on Dr. Lo's part, but now, rather than being delivered to the door, VITASOY was improved and sold through retail outlets, bringing it within the reach of a mass market.

Sales began to boom, and the foundations of a classic brand were laid.

GROWTH AND EXPANSION

By 1950, sales had grown to such an extent that a new factory was built in Aberdeen. In 1953 VITASOY was further improved by sterilization, so it no longer needed refrigeration, and business boomed again. By the mid-Fifties, annual sales had reached 12 million bottles.

Vitasoy factory in Aberdeen (1953)

To keep up with the demand, another new plant was opened in Kwun Tong in 1962. By this time, VITASOY had attracted the attention of UNICEF, the United Nations Children's Fund, who endorsed the concept of a high-protein, vitamin-enriched soya bean milk, and encouraged developing nations to adopt it as way of fighting malnutrition.

Vitasoy factory in Kwun Tong (1962)

In the Sixties, VITASOY malt soya bean milk, the first line extension, was launched by the Group. By this time, the number of staff employed by the Group had increased from a handful to many hundreds, and VITASOY was now truly a household name in Hong Kong.

A GIANT STEP FORWARD

Realizing the potential of modern packaging, the Group took a giant step forward in 1975 and introduced the first Tetra Brik Aseptic packaging to Hong Kong, launching VITASOY and Malt VITASOY in the new package.

Tetra Brik packaging material is constructed of seven layers of paper and plastic-coated material. This packaging, together with UHT (Ultra High Temperature) processing, ensured that VITASOY products would keep for months with all its flavour and quality maintained.

The convenient, hygienic aseptic packaging was enthusiastically received by consumers, and sales boomed to four million cases a year.

DIVERSIFICATION

Up to this point, the Vitasoy story had been one of production, packaging and marketing innovation, marketed by continuous product improvement. Then, in 1976, an era of diversification began.

VITA, a new brand, was created as an offspring of VITASOY, and a range of fruit juice drinks - Orange, Mango, Guava and Lime - was launched. In just two years, these products captured 30% of the fruit juice market.

More flavours followed: Blackcurrant Juice Drink, Sugar Cane Juice, Herbal Tea, Chrysanthemum Tea and, most important of all, the world's first ready-to-drink Lemon Tea, which was so well-accepted by consumers that it immediately became one of the most popular flavours in Hong Kong, and remains so today.

In the local beverage market, traditionally dominated by carbonated drinks, the rapid and successful development of VITASOY and VITA products immediately opened up a new market segment for non-carbonated drinks.

On the other hand, the Group also launched a range of carbonated soft drinks - Cola, Orange, Cream Soda and Lemon Lime under the VITA label.

VITA FRESH MILK PRODUCTS

In 1979, in a joint venture with the Provincial Government of Guangdong, the Group helped the expansion of Shenzhen Guang Ming Dairy Farm, bringing in a herd of 1,200 New Zealand Friesian cows and beginning production and marketing of the VITA range of fresh milk products. These products gained a firm foothold in the market, and the Guang Ming Farm now covers an area of 6,069 acres. Thanks to the farm's herd of some 6,200 New Zealand Friesian cows, Guang Ming currently supplies approximately 55 per cent of the fresh milk consumed in Hong Kong every day.

Recoginsed as a model of its kind, this joint venture is noted as being one of the most successful co-operations between China and Hong Kong.

VITASOY PRODUCTS AROUND THE WORLD

The late 1970's and early 80's were characterised by the Group's push into overseas export markets. Today, VITASOY and VITA products are readily available in over twenty overseas markets including the USA, Canada, Europe, Papua New Guinea, Australia and Southeast Asia.

Accordingly, the group has opened subsidiary offices, appointed local distributors and established local manufacturing in key markets. Exports now represent more than 20 per cent of the Group's total business.

VITALITY VISION: VITASOY TODAY

1984 marked another world first for the Group with the introduction of the 375 ml. Tetra Brik Aseptic package, designed for the more robust appetites of the modern generation. This package achieved instant success, and sales grew so rapidly.

The rapid expansion of VITASOY and VITA products at home and abroad created the need for a much more spacious manufacturing base. Consequently, in March 1987, the Group's head office was relocated the the new plant at Tuen Mun - a plant with HK$100 million investment and one of the most advanced production plants in the region.

Tuen Mun Plant

This computerised facility is a purpose-built structure of 34,000 square meters, housing the general office, the research & development centre, the marketing equipment development division, the sales office, engineering, warehousing and an in-house training centre.

Designed to maximise efficiency and ensure the strictest quality control, the Tuen Mun factory is capable of producing, packing and dispatching more than 540,000 litres of beverages a day, equivalent to over one and a half million packs of drinks.

Shenzhen Plant

And expansion continues. In early 1994, the Group has invested over HK$100 million into a production factory in Shenzhen, China. The factory employs 300 local staff and the products are distributed to local and Hong Kong markets.

The Group's research & development centre has played a central role in the development of VITASOY and VITA products to-date, ensuring the strictest quality control throughout all the steps of the production process. This division will continue to meet the challenge of creating new products through the Group's own research.

With a local production of over 18 million cases of beverages per year and gross sales in excess of HK$1 billion, the Vitasoy Group is now the largest producer of non-carbonated drinks in Hong Kong and one of the leading producers and distributors of a wide range of non-alcoholic beverages in Hong Kong.

In Hong Kong today, the Vitasoy Group has over 10,000 customers, including supermarkets, convenience stores, schools, restaurants, bakeries, factories, the police force, the army and individual stores - serviced by a sales force of more than 300 people and a sales and delivery fleet of over 100 trucks. Elsewhere, the Group has over 1,300 customers in Macau. In other markets, the Group's customers principally comprise distributors and supermarkets.

In 1993, the Group's operations in the United States were augmented by the acquisition of Azumaya, another manufacturer and distributor of tofu.

Vitasoy USA Inc. was founded in 1979 by Ms. Yvonne Lo, Dr. K. S. Lo's daughter. Vitasoy USA Inc. was established to distribute the successful VITASOY and VITA products in North America.

Today, the Group employs over 2,000 people with an outlook that is truly international.

THE FUTURE...

A factor in the Group's success has seen an aggressive, sophisticated and innovative marketing programme. VITASOY and VITA products have maintained a very visible advertising presence, producing high-quality and impactful television commercials that have been nearly as popular as the products themselves.

Expansion, product extension and diversification will continue, resulting from the Group's policy of producing quality products and constantly boosting its already strong brand name awareness in the marketplace.

Future emphasis will continue to be placed on the launch of new products to suit changing consumer tastes. For the immediate future, Hong Kong will remain the principal contributor to Group sales and emphasis will be upon items such as high quality juice drinks and health oriented products.

Shanghai Plant

The development of China's consumer markets offers increasing opportunities for the Group. With per capita consumption of non-alcoholic beverages in China below that of comparable markets such as Hong Kong, current and future market potential is considerable. The future will see the sale of Vitasoy products throughout the PRC, particularly in Beijing, Shanghai and Guangdong. The Group's Shenzhen factory will serve as the initial point for this production. A further production factory is planned for one of the northern provinces of the PRC.

In the United States and Canada, the Group has established an extensive distribution network through its purchases of Azumaya and Nasoya. With an existing end customer base of over 10,000, the Group anticipates further growth in these markets.

Vitasoy today is a different story from the first nine bottles delivered by boys on bicycles. VITASOY and VITA products are an essential part of the everyday lives of millions of people in Hong Kong, as well as in many other countries.

It's a continuing success story that began with a big idea.

And a little bean.