Shin Chun-ho, 92, chairman of Nongshim Group, retires from the front line of management. It has been 56 years since Nongshim was founded with a capital of 5 million won.
Nongshim held a board meeting on the 4th and decided not to reappoint Chairman Shin as the executive director at the regular shareholders’ meeting held on the 25th of next month. President Shin’s term of office is until the 16th of next month. The agenda for the appointment of Vice Chairman Shin Dong-won, Vice Chairman Park Joon, and Vice President Lee Young-jin, the eldest sons of Chairman Shin, as executive directors will be proposed next month’s shareholders’ meeting. Vice-Chairman Shin Dong-won, the largest shareholder of Nongshim Holdings, is expected to become the next chairman. Nongshim has been working on succession with the three sons of Chairman Shin Dong-won Shin, Vice Chairman of Yulchon Chemical Shin Dong-yoon, and Vice Chairman of Mega Mart Shin Dong-ik.
○’Ramen Kingdom’ achieved by virtuous management
Even at the age of 92, it is known that the reason that Chairman Shin, who had been taking care of the company’s issues until recently, decided to resign because of the results he achieved last year. On the 4th, Nongshim announced that its sales and operating profit in 2020 reached all-time highs. Sales increased 12.6% from the previous year to KRW 2.639.8 billion, and operating profit increased by 103.4% to KRW 160.2 billion. Overseas sales exceeded 1 trillion won for the first time ever. It is an analysis that now is the time to establish a new leadership for a second leap forward when the world has been conquered with ramen, a synonym for K food.
Chairman Shin’s half-century management principle can be summed up as’Ubo Man-ri’ (牛步萬里). Since the first development of Lotte Ramyun in 1965, it has adhered to the principle of’the essence of the food industry is taste and quality’. It is said that it is possible to become a 100-year-old company only if it possesses quality competitiveness, which is more essential than fancy advertising and marketing. In the 1970s and 1980s, longevity products that made Nongshim were poured out. Ramen products such as beef ramen, raccoon, yukgaejang bowl noodles, chapaghetti, shin ramen, and Anseongtang noodles, and snack products such as shrimp crackers, potato crackers, onion rings, and honey pot noodles have all been released at the time and have been selling steadily for 20 years. Chairman Shin is also famous for creating the names of most of Nongshim’s products in-house, so he is called’Jaming King’.
○ 56 years insisting on the’essence’ of the food industry
Nongshim Daebang Factory established in 1965
The younger brother of the late Lotte Group honorary chairman Gyeok-ho Shin, chairman Shin, served as a director of Lotte Japan, and at the risk of his elder brother, established Lotte Industries. Since high school, I have been studying and doing business. While doing business in Busan International Market and Jagalchi Market, they failed to sell out-of-date rice cheaply. At this time, experience became the background for lifelong quality management.
It was technology development and investment that made Nongshim the number one company. In 1965, the first ramen production year, the Ramen Research Institute was established. Investment was also preemptive and aggressive. With Seoul’s Daebang Plant as the base, the Anyang Plant, Busan Sasang Plant, and Gumi Plant were built into high-tech food production bases, and large-scale plants were built in the US and China, which are key overseas countries.
Chairman Shin, who believes technology is quality and innovation, has been telling employees since 2010 that it is an era where only luxury foods are sold, and that “we need to make products that can satisfy demanding consumers.” He also emphasized, “If the past 50 years in the ramen industry were soup competition, noodles technology will dictate the next 50 years,” he said. “Don’t know anything else, but never fall behind in the competition for R&D competency with competitors.”
Nongshim’s products come with a lot of the modifier’first’. This is the result of numerous challenges, such as Korea’s first snack Shrimp Cracker, which was manufactured after thousands of failures with 80 trucks of wheat flour, Korea’s first rice noodle and dried noodle patent technology, and Korea’s first jajang ramen.
○ Build a global’core muscle’ and leave
Nongshim is the first and most aggressive domestic food company to advance overseas. Chairman Shin said, “Make Shin Ramyun visible wherever you go in the world.” Ramen was first exported in 1971. It has been 6 years since it was founded. Now, ramen is exported to more than 100 countries around the world. ‘Shin Ramyun’ is being sold from the road in Antarctica to the highest peak in the Alps.
Although performance abroad was slow, it steadily led to’super-gap competitiveness’. Nongshim’s ramen exports exceeded 100 million dollars in 2004, and 500 million dollars in 2015. Last year, it achieved about 40% of total sales, or 1.1 trillion won, overseas.
Chairman Shin is a reclusive manager who is extremely reluctant to expose media. Entrepreneurs have emphasized that the business itself should be evaluated rather than the fancy packaging and image. In 2003, Chairman Shin split Nongshim to establish a holding company,’Nong Shim Holdings’. Currently, it has a total of 35 listed, unlisted, and overseas subsidiaries. There are 19 domestic affiliates. There are three listed companies: Nongshim Holdings, Nongshim, and Yulchon Chemical.
Reporter Bora Kim [email protected]