Success of Lao Gan Ma

Lao Gan Ma is very famous which from Guizhou. Lao Gan Ma has been making through traditional crafts for past decades and it is Elegant and delicate, Spicy, long aftertaste and other Characteristics. Many families store and it will be a good choice as a gift to relatives and friends. In 1984, Tao Huabi created it and got good comment of customs. It was 1966 when Lao Gan Ma was sold in many countries. Lao Gan Ma is the company of Pepper products which products more than 20 Series of products, including the flavor of temper, Chicken flavor chili oil, Spicy vegetables and etc. It was also sold in many foreign countries, in 2012，Gilt served it as the Noble spices and sold 11.95 dollars of each Bottle.

Tao Huabi, she didn’t study in school and just know how to write her name, Within 6 years she Started empty-handed and grow up as a entrepreneur has 13 billion Yuan .She is the CEO of Lao Gan Ma Company, How did she do ? What is the success way of Lao Gan Ma? Now, the following is the analysis:

1、The Support of Government

Here is a story, when Tao Huabi manage her business, the warden, Jiang Xingheng who known her difficult, acted as an Ordinary people to visit her. At the gate of restaurant, he told her: We will help you if you have any trouble. At the process of development of Lao Gan Ma, Leaders at all levels of Guizhou Province Supported her. Many leaders stood in the front-line to struggle against the fake products. Through the hard working and the support of government, Lao Gan Ma got success.

In 2001 Tao had plans to expand production and build another plant. As most of her current assets were earmarked for raw materials, she was advised to go to the government for financial help. After hearing and approving her case, the Nanming district committee coordinated with the China Construction Bank to make a loan to Tao. They then made an appointment with her to discuss the matter.

When Tao and her accountant stepped out of the elevator at the district committee building her coat snagged on a gash in the elevator door. Noticing the rip in her coat Tao remarked, "If the government can't afford to have their elevator fixed they are obviously not very well off. I don't think I'll borrow from them after all."

2、The courage to endure hardship and Hard work, fighting

Tao Huabi was born at a remote village in Guizhou Province. She didn’t study in school because of her poor family. She married at20, however, her husband died after little years.  She had two chills to bring up and she worked and sold something for survive.

In 1989, Tao Huabi Opened a small restaurant to sold jelly and cold. To welcome more customs, she made a kind of Spicy sauce by herself through contemplating of many days. With the Spicy sauce, business is excellent. One day, because of no Spicy sauce and all customs gone. She felt very confused: Do my customers did not like to eat jelly, but like to eat spicy sauce I do?!

She was astute and didn’t give up the details. Then she studied it hardly. After several years of repeated trial, she produced spicy sauce, and the flavor is more unique. Later, many customs buy a bottle of spicy sauce after eating jelly and cold. Even many people come to just buy spicy sauce. She was very happy and stopping selling jelly and cold and only sold spicy sauce.

1996 July, Tao Huabi borrowed two rooms and opened Food processing factory, specializing in the production of spicy sauce. At that time, she recruited 40 workers. She called the spicy sauce Lao Gan Ma. As a boss she didn’t know how to manage the factory. How? After thinking, she told herself: I worked hard, making an good example for them, workers will do too. She thought it a good idea.

What she said, she did so. Everything she did by herself. At that time, technology is backward and economy is developing, all work was done by hand. To make the spicy sauce, they must beat the cayenne pepper into mash and cut cayenne pepper. When you did it, pepper splash droplets let workers never stop tears. All of them did not willing to do it. To solve the problem, Tao Huabi cut it by herself. She said: I treated the cayenne as apples, then my eyes will not cry the moment she did it, because of her humor, workers laughed. That way did work. And all the works picked up kitchen knifes. During that time she charged at the head of her men, unfortunately she was too tired to have a shoulder perarthritis. Workers are moved with her spirit, so they did as hard as she.

However, after producing a large of spicy sauce, trouble appeared. Local Jelly shop didn’t need so much. Products left. Tao Huabi personally carried spicy sauce and put them on trial sale at every shop. The way he thought stupid but effective. About a week, those trails markets called her and let her provide more products. At last, her Lao Gan Ma got steady state, Facing with this condition, Tao Huabi thought: The water depth is shallow tried out, what was I afraid? No. As the saying goes, Making hay while the sun shines. She made up her mind to expand the scale, and change the factory into a company.

At August of 1997, Guiyang Nanming Lao Gan Ma Flavor Food limited Liability Company formally set up. The number of workers increased to more than 200. As a formally company, everything must go on a regular. Rules including production supply and marketing must be complete. She viewed financial, personnel of various statements personally. There were many things she needed to deal with about industry and commerce, taxation, urban management and other many foreign affairs. The relevant government departments often issued documents need her execution. There were also many things he had. At first all of the things, to her who didn’t know words, were very difficult.

But his character was not afraid of difficulty. The financial statements or something completely could not understand, she worked hard from memory and mental arithmetic ability, and then let the financial staff to read to her. If she was dozing off when listened, she will drink Strong and bitter tea. Finally, her Memory and mental arithmetic ability was better than others. Every time the list of statistics out, the financial staff read to her, she will listen to the one or two times to remember and distinguish between right and wrong.

To her, the most headaches were that she often attended various meetings of the competent department of the government and made speeches there. It was very difficult to her. It was driving a duck onto a perch. She had no choice but to please someone to assist her. Just in time, her eldest sonLi guishan demobilized from the army resigned and came to her company to help her.

Li Guishan graduated from high school, what did he do first was dealing with documents. He read and she listened. If something was important, she will stop him and said: this list was important and did it right now. Then she drew a circle on the upper right corner of the documents she needed to sign. Li Guishan didn’t know laugh or cry when he saw the circle. He wrote Tao Huabi on the paper and let mom practice in spare time. She stared at the three words and shocked her head. She sighed: the three words were complex, very complex. However, she wrote hardly as he worked. Because of no study, she felt more difficult than cut pepper. To know how to write her name, she practice whole three days. With her hardworking, she could do it, she was so excited that invited all the staff a meal.

The courage to endure hardship and Hard work, fighting are important factors of the success of Lao Gan Ma, It is through the hard effort, she completed the primitive accumulation of company.

3、Family management, the staff could not bear to betray

Nothing can be accomplished without norms or standards. After the joining of her eldest son, she also wanted to establish the rules for company. Many rules and regulations of other companies controlled staff’s enthusiasm, and workers used inferior materials and turn out substandard goods. 

With those rules and regulations, it could prevent staff loyal to their cause. She knew: Relying on her knowledge of her own and eldest son, they couldn’t make such rules. But she has her own method of management: a family management. She treated all staff with her true feeling. From first to last, she did emotional investment on employees. All workers were moved and could not bear to betray. If one staff betrayed her, all staff will scold that people.

  At first, when Li Guishan made earthy policy, she treated emotion as the basic factor. For example, when she decided the social benefits, considering that it was difficult for staff to eat because company was remote, she made a decision that providing eating and living place freely. Later, there was more than 1300 staff in company, the rules still worked. No one could think it, no one could do it, however, Tao Huabi did it no matter how much she cost.

More than 1300 staff the company had and she could remember 60% of their names. What’s more, she knew many people’s birth day. Each employee's birthday, could receive a gift from her and a bowl of noodles plus two Poached Eggs. And each employee got married， she must personally served as a witness. When employees on business, she also always liked old mother to send children to travel, to cook them a few egg personally, took them to the gate of the factory, they sat on the bus until later, he turned back.

With this family management and treated everyone with true heart, company was super cohesive. To staff, Tao Huabi like their mother and respect her very much.. In company, everyone called her Lao Gan Ma but chairman. Less staff wanted leave. Even though someone left because of something, they could not experience so warm management and wanted to come back again.

4、Honest, to be honest to everyone

With the development of company, Tao Huabi felt the product sales had become a major problem. She neither knew marketing strategy nor knew advertising planning. Even she didn’t have Business cards. How to expand the market?

She knew their disadvantage, and insisted that all roads lead to Rome. She thought for a long time and got the idea that to be honest to others. You could earn money and at the same, you should guarantee other people could earn money. Don't cheat, don't lie, is willing to cooperate with you to do business, you can make the sale. Don't cheat, don't lie, is willing to cooperate with you to do business, you can make the sale. So she hold a meeting and told the staff that all Say no evil not business, but I do not believe it. To be honest to customs even they betrayed us. We must keep this in mind, based on integrity management in market competition, to win.

In 2001, there is a glass product factory provided Lao Gan Ma company 800 pieces (32 bottles of each piece) sauce bottle. However, when the sauce was sold into the market, there are customers to reflect that some bottle sealing lax, to the oil leakage. Unfortunately, some competitors did not know how soon knew it immediately, the use of this attacked Lao Gan Ma. Tao Huabi attached great importance to know, asked the relevant departments to investigate and dealt with quickly. Some management told her that may be just the individual bottle sealing lax, this batch of goods recover resealed, or the cost will be too high, there were 800 pieces. Tao Huabi did not accept it and she thought this is related to the company's reputation! Immediately sent to various places to recover the goods, all destroyed in public, the bottle can not miss! The loss is again big, also did not break in the market the loss. At last, this approach, although the company huge losses, but let people see the Lao Gan Ma abide by a commitment to quality, bad things could be turned to good

With integrity, Tao Huabi won a wide reputation in the industry, enterprise, brand recognition, profits increased year by year.

5、Fighting Fakes

As the Lao Gan Ma brand became more well-known fake products began to flood the market. Li Guishan applied for Lao Gan Ma as a registered trademark as soon as the company was founded, but the Trademark Bureau of the State Administration for Industry and Commerce turned down the application. They said Gan Ma was a common form of address and inappropriate as a trademark, and that it would give counterfeiters a field day. Li Guishan compromised by calling it Guizhou Lao Gan Ma chili sauce

Sure enough, before long more than 50 fake Lao Gan Ma products appeared. Tao Huabi went all-out to defame and ban these counterfeit goods. She spent several million Yuan each year on employing Guizhou's first team of private enterprises specializing in tracking down and exposing fakes throughout the country.

But phony versions of Tao Huabi's product nonetheless multiplied. Top of the list of villains was Hunan Lao Gan Mao, whose trademark and logo were almost indistinguishable from Tao Huabi’s Guizhou Lao Gan Ma.

Tao Huabi waged legal battles with Hunan Lao Gan Ma for three years, from the Beijing Second Intermediate People's Court through to Beijing Higher People's Court. The two companies also had several confrontations at the State Trademark Bureau. Tao's case was among the 2003 top ten classic cases of rights protection.

After much wrangling, including a proposed compromise that would allow both Guiyang Lao Gan and Hunan Lao Gan Ma brands to co-exist, which Tao Huabi dismissed out-of-hand, Lao Gan Ma won. In May 2003, with the help of Guizhou officials Sun Guoqiang, then mayor of Guiyang City, and Long Yuntu, first-chair negotiating representative of China's proposed WTO membership, Tao Huabi's Lao Gan Ma received a registration certificate from the State Trademark Bureau, and the Hunan Lao Gan Ma trademark registration was cancelled.

6、Unchanged by Success

For a woman who is illiterate and with no background in finance, Tao Huabi's is the success story of all time. She has made a five-Yuan jar of chili sauce as famous as the top-rated Maotai liquor brand. But Tao Huabi, unlike the Maotai manufacturers, refuses to know-tow to the capitalist market. Neither does she flaunt her wealth. She was speechless with rage when, in 2005 someone read to her the news that Forbes had proclaimed her the Richest in Woman Guizhou. To the woman whose friends, workers and business associate know her as godmother, being distinguished solely for her wealth was to Tao Huabi the ultimate insult.