UNIVA AWARDS 2021
“How turning disaster into opportunity won the coveted prize,” making NPSG Company of the Year

From June through September UNI-SQUARE introduces NAKAMA who are UNIVA AWARDS 2021 winners. In this the June issue of UNI-SIGHT, we introduce Company of the Year 2021, Naturally Plus Singapore (NPSG).

In 2016, NPSG confronted one survival-threatening crisis after another. It was in the red by the largest amount ever, 38 million SGD (approximately 310 million JPY). The mission assigned to Shinichiro Hatase, who took over as GM in 2017, was to save it. Working to reduce costs and increase sales, the company has erased the red ink and become more profitable with every passing year. For the first time since the founding of NPSG in 2008, it was 1.3 million SGD (about 10.6 million JPY) in the black.

How, in the midst of unfavourable conditions, without the face-to-face meetings that are the heart of an MLM business and movement of all kinds restricted, was the company able to get in the black and become more profitable? We asked GM Shinichiro Hatase about the long road that led to NPSG winning the Company of the Year award.

From disaster to opportunity!
Breaking the mold with higher prices and smaller bonuses.

Juan：Congratulations on NPSG being named the UNIVA AWARDS 2021 Company of the Year!

Hatase：Thank you.

Juan：NPSG achieved its sales targets with year-on-year growth and was in the black for the whole year! I’ve heard that you were able to get everyone pulling together and charging ahead. What tactics achieved those results?

Hatase：The biggest factor was raising prices and reducing the bonus payment rate.

Juan：Ordinarily, raising prices means that members have to pay more. Either the return must be greater or, worst case, their bonuses remain unchanged. But you didn’t just raise prices, you lowered bonuses. Weren’t your members upset?

Hatase：Naturally, there was fierce resistance! I spent four years after taking office as NPSG GM discussing these proposals, raising prices and reducing the bonus payment rate, with our leaders. It took four years for them to come around.

Juan：Can you give us more details about how prices and bonuses changed?

Hatase：Prices went up by 8 to 12 SGD (approximately 650 to 980 JPY) per product. Bonuses were reduced by more than 10% on sales.

Juan：For your top members, that reduction must have been huge. But the members who resisted for four years, how did you persuade them?

Hatase：The COVID catastrophe plunged society into crisis. I told them that if these steps weren’t taken, the company would be bankrupt by the end of 2020. Because this meant the end of the business for the members, they finally understood and agreed to power on together. That was also when Malaysia closed its borders. That closed-country policy was also a factor.

Juan：What do you mean by that?

Hatase：There had been members from Singapore who traveled across the border to shop at the NP salon in Johore Baru in Malaysia. That was because our products were nearly 2,000 yen cheaper in Malaysia. Thus, before the border was closed, there was concern that raising our prices in Singapore would increase this difference and cause more people to buy in Malaysia. Our leaders were constantly raising this issue. When the border was closed, that ceased to be a concern. The dissatisfaction disappeared overnight.

Juan：So, that’s why. Once the border was closed, everyone had to buy our products in Singapore. But weren’t they still worried that higher prices would drive away customers?

Hatase：We were confident that there were fans, i.e., heavy users, of our products. Thanks to their loyalty, raising prices in Singapore substantially increased our sales.

Not missing opportunities

Juan：You converted the COVID disaster into an opportunity.

Hatase：People say that, but it was trial and error. The biggest problem was being unable to organize incentive tours. Singapore is a small country, making it impossible to organize in-country tours. To replace tours as a way to motivate members, we implemented a “Get your money immediately” campaign.

Juan：Was that campaign synchronized with raising prices?

Hatase：Yes, raising prices provided immediately usable cash. That offset the negative impact of the higher prices. Also, offering an early return on investment made this business an opportunity that attracted new members.

Juan：Did the campaign succeed?

Hatase：It was a great success. Sales peaked in January thanks to pent-up demand. We experienced a downturn in February, but thanks to this campaign, sales were 50% greater than expected.

Juan：That’s amazing. It was also an outstanding example of training summit members. In 2020, there were zero summit members. In 2021, five members achieved this rank.

Hatase：Yes, COVID might force them to stop their usual activities. That was unavoidable. That is why I saw it, not as a chance to make sales, but instead an opportunity for growth. I told our leaders to prioritize their personal growth; when the right time arrived, their sales would shoot upward.

Juan：What did you do to encourage leader growth?

Hatase：We organized online events focused on next-generation leaders and invited top leaders from Japan, Taiwan, and America to participate in them. Every event was stimulating, and our leaders learned a lot. The COVID catastrophe made it possible to hold those online events.

The Long Thorny Path to Being in the Black

Juan：I would like to ask you about your unique career. You were originally the GM of Naturally Plus Malaysia (NPMY). Why was it that shortly after leaving Naturally Plus and changing careers you returned to the Naturally Plus Group as GM of NPSG? Was there some special reason for these moves?

Hatase：There were various reasons for going to work for another Japanese company; but even after that move I often took meals with Iwasa-san, who had been my boss at NPMY. On one occasion he mentioned that NPSG would be looking for a new GM, and I was offered the job. After fretting for a while, I accepted the offer. By coincidence, on the first day after returning to Japan from Malaysia, I ran into Group President Nagoshi. Was that really a coincidence (smiles)? That encounter strengthened the feeling that NP was my destiny, and provided the opportunity to return.

Juan：A truly profound connection! But given NPSG’s terrible performance, you must have realized that turning it around would not be easy.

Hatase：My initial goal was to have the company in the black within three years. I had to show results, and it took four years before we were out of the red. Those four years were very tough.

Juan：In 2020, when you offered early retirement, a fifth of the employees retired.

Hatase：Without reducing long-term costs and the employees’ cooperation, we couldn’t have won this award, or enjoyed the taste of being in the black. At one point, the remaining employees had to put up with reduced salaries and adjustments to overtime, promotions, and bonuses.

Juan：That had to be hard on your staff.

Hatase：Despite our being short of people, the remaining staff pitched in and through trial-and-error took responsibility above and beyond what was expected of them. Our success is totally due to these employees, to whom I can only feel grateful. If we can stay in the black, I want to return their salaries and bonuses to their original level.

Juan：Hatase-san, thank you so much. One last word if you please.

Hatase：In 2021, Naturally Plus Brunei (NPBN), where I am GM as well, was in the black for the first time since its founding. Because of COVID, I was unable to travel to Brunei, so this result was entirely the work of three local staff. I would like to use this occasion to praise and display my gratitude to them. To everyone at NPBN, I want to shout out, “You made it! You’re in the black! Congratulations!!!”