With precision machining and sophisticated manufacturing processes, Value Valves has put a gap between itself and its competitors. Its products are highly valued by domestic and foreign enterprises alike.
Back in 1980 David Chen, who had just graduated from the Department of Marine Engineering at National Taiwan Ocean University, and his elder brother Chen Ping-tsao, met with Ping-tsao’s friend Yang Tai-chung and the three of them decided to go into business together. Each contributed NT$50,000 as start-up capital, and they founded the Value Valves Company, specializing in producing valves for ships, the petrochemical industry, and the steel industry. From having doors shut in their faces in the early days to being listed on the stock market today, they have become Taiwan’s leading exporter of valves. Value Valves has grown over the past 41 years to become an industry giant with annual revenues reaching NT$2.387 billion.
Few members of the general public know much about the Value Valves Company, which specializes in producing valves, but firms among Taiwan’s Top 500 manufacturing enterprises, including China Steel, Formosa Plastics, and Taiwan Semiconductor (TSMC), are all old clients. And when the Internet superpower Google set up an operation in Changhua, they specifically asked to work with Value Valves.
Having built up a strong reputation over four decades, today Value is synonymous with specialized valve manufacturing. But in the company’s early days, many refused to do business with the founders, because it was thought that things “Made in Taiwan” couldn’t compare with American, European, or Japanese products.
“When we first started out things were tough. Taiwanese companies believed that domestic brands were not up to snuff, and insisted on foreign products.” In a sonorous voice, General Manager David Chen recalls the difficulties they faced while struggling to get the business on its feet: “After trying to work the domestic market for a while, we thought ‘forget it’ and began to focus on exports.”
Forty years of valves
Before founding their firm, Chairman Yang Tai-chung worked at Kinpo Electronics, Vice Chairman Chen Ping-tsao was at Sony, and David Chen was just finishing up his internship after graduating from National Taiwan Ocean University. The three had to decide what field their company would be in, and after exploring the question for a while, decided not to go into the popular and crowded electronics sector but instead to invest in valves, an industry which had attracted little attention.
“When I was doing my internship on a ship, there were valves everywhere on board.” David Chen graduated from the Department of Marine Engineering, so he had expertise in this area, and his brother and Yang were both good at design. After researching the valve manufacturing process in detail, they began making some products and tried to market them, little expecting that they would be unwelcome everywhere they went.
“At that time the Cheng Loong Corporation was starting to build their plant in Houli, and we visited them once or twice a week, but in the end they decided to buy from Japan.” When the newcomer Value—whose fame and reputation couldn’t compete with those of big foreign firms—went to promote their products to the Formosa Plastics Group, at first they were again given the cold shoulder by the purchasing department.
Selling to Formosa Plastics
Things only began to turn around for Value Valves when they became a supplier to Formosa Plastics, which had previously only used valves imported from the West.
However, just because they had gotten one factory at Formosa Plastics as a client did not mean that Value was in the supply chain for the whole Formosa Plastics Group. Business General Manager Chien Pei-ling, the only woman in the management team at Value, says straight out: “Chemical plants tend to be cautious and don’t change suppliers lightly. It’s not because they don’t know you; it’s just that they are afraid that unsuitable products may jeopardize workplace safety.” Some explosions and accidents at chemical plants happen precisely because of problems with valves. As a result, Value’s products had to be comparable in quality to those from the West to win the trust of customers.
In the male-dominated valve industry, Chien is one of the few women in sales. Talking about the ups and downs of calling on clients back in the day, she says with a smile: “These days sales work is much easier. Samples are made in lightweight acrylic, and customers who want to see the inner workings of products and understand the production environment need only download an app onto their mobile phones, and through augmented reality they can see everything at a glance.” When Chien was out doing sales calls back in the day, she was on her own, and had to carry heavy metal butterfly valves, sometimes walking with them for a kilometer. Speaking about this, David Chen has nothing but praise for Chien: “She was very strong, and she would just pick up a six-inch valve weighing 20-odd kilograms and set off on her way.”
Tricks of the trade
Today, the butterfly valves produced by Value have a more than 60% share in the industrial valve market, and the giant valves used at many steelworks, power stations and petrochemical plants come from Value’s factory at No. 9 Zhongshan Road in Tucheng, New Taipei City. Associate General Manager Jacky Chen points at the five-story-high ceiling and explains the production process in the high-tech factory: “The No. 9 factory mainly produces large valves used in heavy industry. These valves are so big that we have to use gantry cranes to lift them.” Just recently the No. 9 factory produced a giant valve with a diameter of 136 inches, making it one of the largest in the world.
Even today, the valve industry still has to follow traditional manufacturing processes and cannot go for complete automation. They can at most rationalize the production process, using machinery to assist workers as much as possible. As a result, there are many tricks of the trade to be mastered. Jacky Chen points to a butterfly valve that is being tested and says: “It’s like the windows in your home. A well made window with good seals will be completely airtight when closed, but with a badly made one you can hear the wind whistling through the gaps.” It takes high-precision casting and machining processes to create a valve that gives a perfect seal. Value’s mastery of these technologies is the main reason the company has been able to stay ahead of the pack.
International certification
In addition, Value, which prefers to develop its technologies in house, has collaborated with academic institutions including the National Chung-Shan Institute of Science and Technology and materials science research institutes at universities to produce valves with special capabilities, such as being suitable for locations involving fire or explosion hazards or resistant to extreme temperatures. Value has also earned international certifications for these products. “The future is in cryogenic valves,” observes Jacky Chen. “Right now people are opting for energy sources like liquefied natural gas rather than petroleum.” Natural gas cannot be transported in its gaseous state, but must be liquefied under pressure at super-low temperatures for transportation in LNG carrier ships. For this you need cryogenic valves that will not deform even at 196 °C below zero. Value Valves has been developing special valves like these for a long time and has earned the relevant certifications. David Chen says modestly: “I can’t say we are ahead of all our competitors when it comes to cryogenic valves, but we have certainly put a lot of effort into this field.”
In the past valves were considered “small beans” by businesspeople, but by concentrating on playing this “supporting role” in industry Value has found its place. Its technology is even ahead of that in Japan, so that Japanese companies have come to Taiwan to learn from Value. Value’s experience confirms that if you focus on your core business and manage your operations with attention to detail, you too can become a leader in your field, and bring “Made in Taiwan” products into the international spotlight.
