The company behind the bristles

Hong Kong — Brushes have been in the Hay family DNA since William Hay launched the South Australia Brush Co. in 1893.

Donald Hay — William's grandson — got back to his family's roots in 1988, when he set up a joint venture to make household brushes. That was just two years after Hayco Ltd. opened its first factory, in Guangzhou.

Toothbrushes, floor brushes, vegetable brushes — if it bristles, Hayco makes it. The company also makes many other familiar products — cleaning supplies, kitchen utensils, beauty products and electric shavers and toothbrushes. All are branded by the company's customers, multinational corporations such as Wal-Mart Stores Inc., Target Corp., Clorox Co. and OXO.

“Those companies sell around the world, so you can say we sell around the world, but indirectly,” Hay said.

While Hayco's products may be un-techy, the processes behind it are anything but. After opening its first Shenzhen factory in 1995 — the company now has three — Hayco moved swiftly into being a vertically integrated designer and manufacturer of fast-moving consumer goods (FMCG).

It's a mouthful of an acronym that means the high-turnover stuff lurking in your kitchen, bathroom and closets — brushes of all sorts, cleaning supplies, mops and beauty supplies. Last year, Hayco shipped 200 million products to 40 countries.

Procter & Gamble Co. will be the first client of Hayco's upcoming $50 million factory in the Dominican Republic, now under construction and scheduled to start production in 2017. The 186,000-square-foot facility will be Hayco's first outside China and one of the biggest built by a Hong Kong company in the Dominican Republic. Hayco also plans to add a 129,000-square-foot facility in 2021. When fully operational, the two facilities combined will employ between 1,500 and 2,000.

The privately held company views itself as an innovator in everything from design to shop-floor management. Said Hay: “We've invested in a wide variety of automated machinery, for both manufacturing and testing. We're also doing business process re-engineering.

“For example, we've built centralized databases with high-end IT systems. We use these to share information among departments, which reduces errors that come from repeatedly inputting the same information. We can also share data, in real time, with our customers.”

The productivity gains have been dramatic. “[In 10 years] we've gone from 7,000 workers to 3,500, but the total number of products we produce every year has increased over 100 percent. That's a result of automation and careful organization,” Hay said.

Managing Director Amii Tam, a 30-year company veteran, added: “In China, we're changing from a labor-intensive model to an engineering-intensive model. This has all happened in the past five years. Everyone here is looking at automation solutions. What China is very good at, is it's very flexible. You can change things very quickly.”

The move to the Dominican Republic was made at the behest of U.S. customers, for whom short shipping times are key. Still, the decision was not taken lightly.

“There's a fear factor in moving outside China and Asia. But we feel with our management culture, we can make this transition well,” Tam said.

Hayco's plastics processing technologies include structural foam, coinjection, blow molding, overmolding, and two-shot injection molding. It assembles medical devices on an FDA-certified line.

But everything starts with design, Hay said.

“Designing the product so it's manufacturable is a key, a big, big key. A lot of buyers don't think about how a product is going to be made, and a lot of factories have injection molding machines but they really don't know how to design a product for manufacturing. We've been able to save a huge amount of money for ourselves and a customer by designing products that are manufacturable and high in quality.”

The design shop will remain in China after the Dominican Republic plant opens, Hay said.

Over the years Hayco has won a fistful of awards from its customers, including Philips' Most Innovative Supplier and Procter & Gamble Supplier of the Year — no mean feat, given that P&G has 80,000 global suppliers. At Wal-Mart's annual Women in Factories conference in September 2015, Hayco nabbed recognition for its Bluebird program, which serves 600 women workers by helping them with financial planning, personal and emotional health and career development.

“We're always looking to grow,” Hay said. “We're more focused on improving productivity and efficiency. A 100 percent increase in productivity in 10 years is very good, we think.”

Tam added: “I think we're a private company with a lot of family values, of loyalty and respect and it's a family. In terms of practice, we adopt a lot of modern business practices. How do we bring these two together? It's kind of an art. We don't want to lose that entrepreneurial spirit, that flexibility, agility and being able to change directions quickly, and being small.”