BBS Electronics started out solely as a distributor of electronic components iin the 1980s. It bought components in bulk from suppliers like Philips, Analog Devices and Fairchild Semiconductor, and turned around and sold them in smaller packets to manufacturers who used them in making their own products.

In the 1990s, its customer profile changed. BBS found itself supplying to original equipment manufacturers (OEMs) who made end-products for more than one brand.

The OEMs needed more technical support, and BBS Electronics, like other distributors, began hiring field application engineers to serve them. These engineers would help to recommend and design a suitable component to fit the functions and features that the end-product required.

'Touble is, that does not create more business for us,' said Mr Hui. 'It might help to provide better service, but that really is not key. A lot of companies actually think that this is one of the important issues.

'Partly, it was driven by many of the principals who were selling the components to us. They insisted that if we were to be their channel partners, we had to give this kind of value-add.'

And so, BBS Electronics and its competitors started offering services that did not help generate income per se. To make matters worse, increasing competition from more players was slashing profit margins. And as customers moved their manufacturing bases overseas, that created new problems for the company.

'They (the customers) don't grow in the same spot any more,' explained Mr Hui. 'They grow in different parts of the world.'

Another problem was the BBS Electronics was big enough to show up on competitors' radar screens, but not large enough to acquire distributors of component product lines they needed. It looked like the end of the road, he said.

But after 'some soul-searching', the company decided to utilise existing resources to rework their business model.

New business model

On top of its role as a distributor, it became a facilitator for manufacturers. Now, field application teams in developing counries give market feedback to the manufacturers. The manufacturers can then leverage on the knowledge to increase demand for their products, indirectly helping BBS Electronics to grow its own revenues.

'Many emerging markets in Asia have not reached a stage of high-tech manufacturing. What they need is solutions to their infrastructural development. Many of these fall into the areas of electronics, telecoms, IT, and industrial,' said Mr Hui, who declines to elaborate on their business model for competitve reasons.

Mr Hui said he is still managing the effects of the new business model. 'Every strategy has its useful lifetime and expiry period,'  he said. 'Any way I can buy time to separate our advancement from our competitors, I will . . . for as long as I can.'

BBS Electronics - which already has a presence in Australia, China, India, Malaysia, Philippines and Thailand - is looking to expand its markets. It is eyeing the CIS countries, Taiwan, Korea, and even Japan.

Mr Hui sees the Singapore office as the nerve centre, where strategy-building, training and coordination take place. But, exciting new developments and partnerships are likely to happen outside Singapore.

On its financial goals, Mr Hui aims for a turnover of $500 million by 2008, from $208 million in 2002. 'That means that every year, we have to grow by at least 30 per cent,' he said. It'll be tough but not impossible, he reckons.