Brothers in arms Featured

8:00pm EDT April 25, 2007
In 1979, 16-year-old Andrew Ly immigrated to the United States from Vietnam with $1 in his pocket. Twenty-eight years later, he’s at the helm of a $42 million corporation.

Upon arriving in the United States, Ly learned English, put himself through college and in 1984, pooled $40,000 with his four brothers to open the first Sugar Bowl Bakery. Today, the 400-employee Ly Corp. — the parent company of Sugar Bowl Bakery — is a thriving wholesale business, with customers ranging from the Costco chain of grocery stores to the luxury hotels of the San Francisco Bay, and is averaging revenue growth of 20 percent per year.

Smart Business spoke with Ly, president and CEO of Ly Brothers Corp., about the importance of diversifying your business, building a strong reputation and creating a positive work environment.

Q: How do you create a positive environment for your employees?

I read tons of books, and every time I read a good quote, I put it on the board. I want to motivate our employees to make sure when they walk in or walk out, they see that quote from me on the board.

I also challenge them to read books. Especially the books that I read and like, like “Built to Last” or “Good to Great” [both by Jim Collins], or “Pour Your Heart into It” [by Howard Schultz]. Everyone who finishes reading the book and lets me know the key points in the book, I reward them $100 per book they read. There are an unlimited number of books they can read per year.

I have lunch with my employees all the time. I try to let them know as long as we work hard and think smartly, everything can be done. I also encourage them to go to a seminar, and if they need to, go back to school.

We are willing to contribute to learning. So then I can learn from them, too. That is how I create a positive working environment and positive thinking for our employees.

Q: How have you achieved business growth?

We do a lot of R&D; we learn from customers, study trends to see what products are demanded tremendously in the marketplace. We diversify our product line based on those studies; we create products and diversify them.

We don’t just depend on one customer. We go out there and diversify our customer base across the board, whether it’s as big as Costco, Starbucks and Safeway, or as small as a coffee shop or hotel in downtown San Francisco.

Be innovative. Try to study the trends and make great products so we don’t sacrifice too much margin. We grow, but maintain margin so we can invest into our manufacturing. That’s how we make sure we have the right products in the right place across the board.

Q: What is the most important thing a CEO has to do?

You have to be a hard worker. This is where the phrase ‘leading by example’ comes into focus. This is where the tone of the company is established. People will most likely listen to you when they know that you are a hard worker.

Also, make sure you build a good reputation. You have to have good personality and character. There is a saying that ‘Good personality opens the door. Good character keeps the door open.’ As a leader, you have to have those two. We need to say what we mean and we have to do what we say. If we establish those two things, that will work for us at no cost in the future.

Q: How do you build a strong reputation?

At the time we started out, even though we struggled to pay ourselves, we had to make sure we paid our employees. Also, you have to treat them well.

Our employees can take a vacation, but I did not take a vacation for 10 or 15 years. We have to sacrifice to make sure the company is successful, but we don’t want the people who work throughout the company to suffer.

No. 2, when people are in need, like an organization like Feed the Children, or children’s hospitals, big or small, we want to donate. If we are successful, these children should not be going to bed hungry. We know how hard it is to get through those days. So we want to provide financial support or any kind of support to those people.

Those organizations are good to support and help build us a good reputation. It’s a benefit when people know we have a big heart with the community.

HOW TO REACH: Ly Brothers Corp., (415) 824-3592 or www.sugarbowlbakery.com