A Closer Look

Tycoon Percussion
Celebrating 30 Years
by B. Laurel McKenzie

hirty years in business is an accomplishment worth noting, but thirty years as a prosperous family company that spans the globe is worth celebrating. While the word tycoon may conjure the image of a mogul, Tycoon Percussion is, in fact, a model of generational dedication. Founder and president Stephen Yu and his wife, Jade, even named the company after their thenone-year-old son, Quincy, whose Chinese first name is Thai Khoon. Quincy is now senior vice president of Tycoon, and his sister, Ivy, is the general manger. Stephen Yu grew up in Hong Kong in the late 50s and 60s and says music has always been his lifes passion. In 1983, the happily employed commodities trader merged his love of music with his desire to operate his own business by establishing the Tycoon Music Company, the first and only guitar manufacturing facility in Thailand at that time. Tycoon made guitars to be sold locally and internationally on an OEM (original equipment manufacturer) basis for about eight years before deciding to switch the focus to hand percussion. A testament to its success in manufacturing guitars, Tycoon quickly began receiving requests for percussion instruments from its customers. According to Yu, hand percussion was approaching its popularity peak in the early to mid-90s, so he saw an opportunity to develop a new brand. There were only a small number of factories in Thailand that could manufacture highquality percussion instruments at that time, he explains, and most of them were under exclusive arrangements with our competitors today. Supply became very scarce, and I felt that there was an opportunity for another brand in the market. The fact that none of the world-renowned brands had their own factories and we did represented a major competitive advantage for us. The decision to enter the hand percussion market, however, meant having to make changes to the Tycoon factory. Yu admits the transition from manufacturing guitars to percussion was challenging, as machinery and tooling required modifications. It was a time-consuming and costly process, he says. But I was convinced that this was the direction that our company needed to take. Tycoon continues to manufacture some OEM products for a small number of longtime customers, but the factory is mainly filled with demand for Tycoon Percussionbranded products. We are not actively pursuing OEM business at the moment, Yu says, but we continue to serve customers who have been working with us, as a gesture of appreciation for their continued loyalty over the years. The decision to establish Tycoon Percussion USA (originally Premium Sound, Inc.) in 2006 was twofold. First, strengthening the distribution presence in the worlds largest music market was imperative, so having total control of that distribution process was fundamental. We

have always viewed the U.S. market as the most important one of all, so we needed to make sure that the brand building and distribution process was done in the right way from the very beginning, Yu says. Secondly, we wanted to channel all of our worldwide marketing and advertising efforts through our U.S. office, thereby creating a consistent and unified brand image around the world that originates in the U.S. Tycoon Percussions first stateside office was located in Pasadena, California, with a thirdparty logistics facility in Reno, Nevada, to fulfill storage and shipping requirements. As the company grew, staff members were added, and a move to Chino, California, allowed for both an office and an onsite warehouse facility. Due to further expansion, Tycoons headquarters is now located in a larger office and warehouse facility in Ontario, California. Tycoon employs roughly 150 workers at its factory located on the outskirts of Bangkok, and because the vast majority of its percussion products are made in house, the manufacturing process is divided into many interconnected departments. Good communication and collaboration between all involved is key, with production team leaders, all of whom have been with the company at least twenty-five years, reporting to director of manufacturing Preecha Khamhomkul, who is now in his third decade with Tycoon. Production managers analyze lead times and order processing to maximize manufacturing efficiency. Says Yu, Because we operate a Just in Time manufacturing system, all departments must communicate regularly with the production managers and Preecha to make sure that we achieve the goal of reducing in-process inventory and its associated carrying costs, while at the same time meeting our established lead times for our customers. Having worked through the early stages of establishing Tycoon Music, Yu was prepared for the impending difficulties faced by newly formed businesses. It was pretty much what I had expected, he recalls, as far as the types of challenges that we would have to face in the early stages, such as many dealers not knowing who we

were, working around cash-flow issues, and hiring good people to fill out our team. By the end of the first year, Yu saw the growing pains dissipate, and Tycoon began to gain momentum in the marketplace. Along with developing marketing strategies, creating a clear brand identity for Tycoon Percussion is a family effort. Quincy Yu was instrumental in launching Tycoon Percussion USA, but he moved back to the main office in Thailand in 2011 to take charge of developing the companys worldwide distribution network and to build the brand globally. Ivy formally joined the company in 2010, and as general manager she spearheads Tycoons global marketing efforts with the team based in Ontario. Jade controls the finances and also plays a lead role within human resources. The relatively small Yu family unit has been able to fill the large roles within the company, but Stephen is quick to add that staff members are also considered family, which is why Tycoon Percussion has such an exceptional employee satisfaction and retention rate. Furthermore, customers are treated like an extension of that family and can expect extra care and assurance that they can reach any member of Tycoon by email or phone. This is an important factor in building the brand, and its the foundation of Tycoons marketing. Whether its print advertising, website, or social media, [they] all contribute in driving this home, Yu says. Also important to Tycoon is receiving feedback and ideas from those who play its instruments. From the novice to the professional, Tycoon asks percussionists to freely submit product ideas. While not all of the suggestions find their way to the manufacturing line, products that make sense, from the standpoint of innovation and cost, frequently do. For example, the Rhythm Rack, conceived by Tycoon artist Douglas King, was originally developed for handicapped musicians, to allow them to play without having to grip a drumstick, but the product has found success with other musicians who want to play stick instruments, like cowbells and blocks, using their bare hands.

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 Also helping to secure brand identity is Tycoons relationship with its endorsers. When Robert Vilera is touring with Shakira and playing on world-class stages everywhere, it provides a forum to showcase our instruments, not to mention getting millions of eyes on our products, Yu says. Having a good team of artists around the world is priceless in our efforts to further develop Tycoon Percussion on a global scale. According to Quincy Yu, cajons are Tycoons number-one-selling product category worldwide, which can be attributed to the increasing global popularity of the instrument. The company has spent a great deal of time and resources in research and development to further expand our cajon range over the past few years, he explains, and that has resulted in our extremely diverse and innovative offering of traditional and hybrid cajons. For Tycoons thirtieth anniversary, the Celebration series was introduced and includes congas, bongos, a cajon, and a djembe, constructed of hand-selected top-grade American ash. Special consideration was taken during production to accentuate the patterns of the wood

grain. The dark-matte finish and black calfskin heads create a distinctive look. Tycoon Percussion also thinks globally, through its green production processes. Our company is very much aware of our global footprint and the need to establish and maintain environmentally friendly manufacturing practices in our everyday production, Stephen Yu says. Tycoon uses sustainably harvested rubber wood, taken from certified plantations throughout Thailand. And within the factory, the company utilizes scrap pieces for productive purposes to minimize waste. Sawdust is taken to processing mills to be turned into fuel; small pieces of rawhide left from making drumheads are used to produce rawhide bones and dog toys; and plywood remnants are used to make instruments to be donated to impoverished children in rural provinces. When asked what sets Tycoon Percussion apart from other companies, Stephen states, I believe being a family-owned business that is solely dedicated to one product category truly sets us apart from our competition. It allows for us to have a uniquely focused commitment to

building the best hand percussion instruments on the market. And [being] the only company in this product category to own our own factory allows for us to be the quickest to market new product ideas and innovations. Adds Ivy, People relate to the people behind the company, and we want them to relate to us. Were a family business trying to do our best, and quality is obviously the most important thing to us, as well as how we treat people. This years thirtieth anniversary celebration for Tycoon will acknowledge those who have been with the company from the first day for their loyalty and dedication. Quincy shares the story of one employee, whos now head of drum shell production, who met his wife at the factory and whose first-born child now works in the handheld percussion assembly department. This is the type of story that keeps me motivated every day, he says proudly, knowing that Tycoon Percussion not only provides a livelihood for many of our employees, but also a way of lifea family. tycoonpercussion.com

Reprinted by permission of Modern Drummer Publications, Inc. 2013 www.moderndrummer.com

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