As it enters 26th year YCO Corporation braving economic downturn

It is not very easy for someone to shine in a land other than his own, especially in the Northern Marianas where non-indigenous people are considered no more than outsiders.

But an outsider proved this public assumption wrong. Over 30 years since he arrived on Saipan to work as a civil engineer for an American firm, Jess Yumul has grown beyond what an ordinary overseas contract worker can normally achieve.

He grew up in Concepcion, Tarlac, a province north of the Philippines’ largest island of Luzon. By the time he reached 17, Mr. Yumul tried his luck in Manila where he finished his course in civil engineering in Mapua Institute of Technology in 1968.

Today, Mr. Yumul stands proud as the owner of one of YCO Corporation, one of the strongest companies in the CNMI, that has survived stacks of financial upheavals and continues to brave the longest economic crisis ever to hit the islands.

His formula is simple: continue doing what you do best.

“That’s the only way you can withstand economic hardships. The company is hurting just like anybody else but we are focused at taking just one direction, upwards. There are lessons to be learned from the crisis and that’s what we have been doing, practicing what we have so far learned,” Mr. Yumul said.

He said economic difficulties gave birth to a more resilient YCO Corporation with strong indications becoming more visible when the company brought Philippine hamburger giant — Jollibee — to Saipan.

Don’t get him wrong, however. Mr. Yumul pointed out that expansion is not always a good move especially when businesses over-expand. “There is such a thing as good timing and the proper business.”

YCO Corporation has been witnessing an average of 30-40 percent drop in earnings since the adverse effects of the Asian currency crisis started fanning to the isolated islands of the Northern Marianas.

The company’s chief executive officer projects that the local economy is not likely to witness a significant turnaround in the next two years. He admitted that the projection may be too pessimistic but it is most realistic based on current visitor market trends.

Mr. Yumul believes that YCO Corporation, being able to survive the Asian economic turmoil, has become conservatively cautious in its everyday dealings due to the fact that earnings could plunge deeper considering the double whammy faced by the CNMI business community.

Aside from the CNMI consumers’ weakening spending power, YCO Corporation general manager Rey Yumul said business owners in the Northern Marianas are also faced with skyrocketing operational costs brought about by higher fuel prices.

The younger Yumul said higher fuel costs make it harder for YCO Corporation to make concrete actions in achieving what the firm has originally planned — reduce retail prices of the items it sells in order to corner a bigger chunk of the Saipan market.

“We want to be a market leader but the economic difficulties and the increasing prices of petroleum products are making it kind of harder for us to carry out what we had planned ahead,” he said.

But YCO Corporation, standing pat on what Mr. Yumul has envisioned it, is not likely to let external forces get in the way. There is an existing market, he said, adding: “It is now a matter of bringing the company closer to our target consumers.”

YCO Corporation owns Liberty Plaza Department Store, two Truevalue Hardware stores and a construction company. Its newest acquisition is the Saipan franchise of Jollibee, a leading Filipino fast food chain which has more than 10 restaurants outside the Philippines.

Despite the slowdown in the CNMI construction sector, YCO Corporation’s hardware stores continue to get ample orders from homeowners who have been carrying out renovation, repaint and remodeling of their houses.

Rey said the economic turmoil which hit the Asia-Pacific Region since middle of 1997 paved the road for investors, like YCO Corporation, to realize the need to get their fiscal house in order.

Individual economics have changed because of the crisis. It has made YCO Corporation stronger but a little more cautious. “Hard lessons were learned from the recession,” Rey said..