JERRY TUGADE
President
JOEL RYAN E. TUGADE
JOSEPH PATRICK E. TUGADE
Managing Directors
COOLAIRE CONSOLIDATED, INC.
By Bernie Cahiles-Magkilat
Engineering company Coolaire Consolidated Inc. specializes in the refrigeration business. Its products include truck refrigeration systems, imported fiberglass bodies, cold storage equipment and panels, and rooftop air conditioners. Chiefly providing services to the food and pharmaceuticals market, Coolaire accounts for a large majority of refrigerated vans in the country.
This three-generation family business has constantly evolved as it innovates to stay relevant for the current and the future.
Second generation Jerry, the family patriarch, and sons Joel Ryan and Patrick Joseph, are working harmoniously to push the family business to greater heights.
The company
Coolaire was founded by engineer Filadelfo Tugade Jr. in 1969. His son Jerry, also an engineer, took over the operation in 1970s. Jerry still serves as company president.
Now, the third generation is being ushered into the family business with Joel and his brother Patrick Joseph both serving as managing directors. Joel is in charge of operations and service while Patrick handles sales and marketing.
Originally, Coolaire provided the air conditioning needs of all the US Federal government offices and agencies in the Philippines. These American facilities include Clark, Subic, Sangley, Cubi Point, Baguio radar station and Camp John Hay.
Jerry said they would ship the airconditioning equipment from their principal in Oakland, California through the US navy ships.
In the 1980s, Coolaire decided to change its operating status from a single proprietorship entity to a corporation. Thus, Coolaire Consolidated Inc. was incorporated to pave the way for its future growth and expansion plans.
To this day, Coolaire is the premier supplier and contractor for temperature control equipment, account for the bulk of the sales of cooling equipment into the Philippines for applications such as transport cooling, food preservation, stationary cold storage and freezing, special air conditioning, and container refrigeration.
Three generations
The first two generations of Coolaire are considered one of the greats in the refrigeration business. They worked along with the country’s foremost engineers whose colleagues and partners include National Artist Leandro Locsin. Together, they worked for the construction of the Philippine International Convention Center.
“They were in charge of the mechanical and the design, but my father designed the airconditioning of the PICC,” declares the proud son.
The first two generations are engineers, mechanical and electrical, but third generation Joel and Patrick took different paths. Joel wanted to be a doctor or lawyer as a young man. He finished legal management, but one day he woke up not wanting it anymore. He decided to join his father and from that day on focused on the family business. His brother finished business management.
Jerry does not find it a hindrance or was frustrated that his kids did not follow the family’s profession. He said that his sons have been immersed in the business ever since they were kids as their house is located just beside their office. Joel is the eldest of four siblings. Two daughters are living in the US.
“Ever since I have been involved in the business and even during summers we worked and earned from that. As kids, we made reports on certain operational issues of the company,” says Joel, who as a college student already handled an airconditioning deal for Coolaire.
When Joel and Patrick finished college, they had the opportunity to work for the company. Their father did not force them to follow the family’s passion for engineering, but the boys just gravitated naturally towards the family business. Joel formally joined the company in 2002.
“I always had the assurance that my children would follow,” the amiable elder said. Even Jerry was exposed in the business while still in college.
Service
For the past 50 years, Coolaire is known for its dedicated customer service, earning a reputation as the most reliable and widely used refrigerated vans in the Philippines.
With the constant drive for excellence in product and dedicated customer service, Coolaire boasts of a wide product range of equipment suitable for the major aspects of the all-important cold chain.
Coolaire has preventive maintenance services through cleaning and evaluation of your equipment, continuous needs assessment program customized to your operations. For repairs and maintenance, Coolaire evaluates the entire truck refrigeration systems, cold storage equipment, and reefer containers. It also gives recommendations on parts replacements.
Coolaire offers to transport fresh and frozen products under harsh tropical conditions with its truck refrigeration systems and imported fiberglass refrigerated vans.
Coolaire also provides cold storage equipment and insulated panels for all commercial and industrial needs. Its fiberglass vans for dry cargo are watertight, light-weight, and designed with critical attention to detail. This means, Coolaire fiberglass solutions are no longer limited to just refrigerated and wet loads.
All these after sales services are made possible anywhere because Coolaire has presence across the country and are able to reach all corners of the nation.
Coolaire prides of being the preferred partner of most food companies because it does not sacrifice safety. Thus, it urges players in the cold chain business against settling for enough quality, but to make a responsible choice.
The company expanded its refrigeration business with locations across the country but still maintained its main office in Quezon City. It has a plant in Bulacan and a satellite office in Cavite. It has presence in major cities such as Cebu, Iloilo, and Davao.
“We intend to add more facilities this year to be more accessible to our customers,” he adds.
Foremost, Joel emphasizes the company’s thrust towards quality service to all its customers wherever they maybe.
“We do not just supply, but we provide after sales service and that makes us unique among players in the industry,” says Joel. This emphasis on thorough after sales service is assured even as the company only provides the best quality products and systems there is for their customers.
“We perform based on our commitments to our customers and on their operational requirements,” says Joel. Coolaire also works closely with truck head and chassis providers while they provide the body and refrigeration equipment and systems.
Cold chain
The role of refrigeration in business may not be that visible, but it is critical in the cold chain business and in the entire supply chain.
Refrigeration is needed to make the food and goods reach the consumers safe for human consumption, ensure against spoilage and makes produce less expensive.
“The Philippines being an archipelago, it is important that the supply chain is not broken,” stresses Joel citing there are 500 airports and over 800 ports around the country. Without connectivity, ensuring the freshness of perishable goods will be a major problem for all.
He lamented at the lack of connectivity and outdated farm practices and poor transportation, which has resulted in a high 40 percent spoilage of farm output that reduces income of farmers and causing higher prices for consumers.
There used to be a difficult time also for Coolaire when they compete against imported second hand refrigerated vans, which appeared cheaper upfront but become costly later on as they easily break down because they were not built for the tropical climate and terrain.
With the refrigeration system that they developed, Coolaire partnered with a US supplier using fiberglass, which is lighter and therefore the pressure on vans is much less resulting in longer use of tires and less gasoline. They are able to supply in one week instead of two months.
“In our design, we invested in the manufacturing of the body which is now fiberglass and food grade,” says Joel.
They can customize according to the requirement of their customers. Food companies can be provided with mobile storages that can be transported from one place to another because these are modular systems.
Business
Demand for refrigeration systems has also gone up because many restaurants have opened up not just in Metro Manila but in the provinces. Several new communities have been opened and that needs additional supply of food.
Coolaire, which is principally serving the food sector, is in the right business at the right time.
“Business is doing well and we’ve been expanding in the last 5 years,” says Joel. Coolaire must be selling more than 100 trucks a month. In fact, Coolaire accounts for the vast majority or at least 80 percent of the refrigerated vans in the market all over the country. There are other providers but they do not have the scale of the after sales service that Coolaire provides.
He cited the vast expansions of convenience stores, supermarkets and drugstores. These are the biggest contributors to their growth.
“We have customers who are part of these networks supplying to them. So, we ride on the expansion of the economy and growth in frozen food,” says Joel.
The strong BPO sector has also fueled consumption by its young workforce, who are mobile and are always eating out. “Their lifestyle is driving growth of the industry where we belong,” he adds.
“Simply told, all the perishables in your refrigerators are our customers,” stresses Joel. Jerry further explained that as companies continue to develop communities and townships in the countryside the more there is need for cold chain facilities.
“When they move over, that is where we are also so we keep on moving and innovating also,” says Jerry.
Innovation
Joel said that when they lost the US Federal government business, they reinvented themselves.
“We have to always innovate because if not, we will die. Innovation has been part of father and grandfather in engineering, making sure the designs are up to the situation. That is our strength,” he adds as he cited the core industries in food and pharmaceuticals that formed what they are today. The country’s biggest food companies are their clients.
“It is always about providing solutions. We are not order takers but we go further than that because we are engineers, and we understand our customers. So, we provide solutions that do not cost that much,” says Jerry.
They build the body to suit to the needs of the customers. Some customers would like the doors on the sides, others at the back. Some would specify two rooms inside or three. “Sometimes, they don’t know what they need so we suggest,” says Jerry.
“We share best practices and what modification to run a more effective and profitable business,” said Jerry.
Expansion plans are moving towards the provinces where their customers are also going, particularly in the Visayas and Mindanao areas. As the company celebrates its 50th year, they are contemplating at expanding in related areas where their expertise can be of great help.
“If you are a food logistics company with 300 trucks and your operations are not just confined to Metro Manila, we have to know that because you expect me to be there. We will not leave you there because I don’t want you to have any problem. For us that is part of our DNA of who we are,” adds Joel.
People
“We have good products, so we have good people,” the father adds noting that the company’s nationwide operation is ably supported by its 250 people. They are still hiring 30 or more technical people as they plan to build more and expand its existing facilities to support customers in strategic locations.
The father and sons’ team do not put a divide between its people. Employees have easy access to them and the management engage their people.
“Our drivers have been with us for 25-30 years because we take care of them,” says Joel. In fact, the company is big on providing value formation and promotes the company culture. Employees recite their core values every morning because they want everyone to live it, embody it and always remember it.
They also source their employees organically. Their existing people have the first crack at every opportunity for promotion. Their people are not equipped with the technical knowledge but they are guided by conducting spiritual meetings and value formation. The company holds flag ceremony every day and they always start the day with a prayer even in meetings.
“We always believe that the family is the strength of our people. If they have problems that will reflect on their job, so we try to fill up that gap. We also serve as their example so we try to walk the talk,” says Joel noting that most of their key positions in the company are occupied by women but those in the implementation sites are industrial engineers and are mostly men.
He noted that their strength depends on the value they have created and imbibed by the employees. Thus, they can only be stronger with the strength of their people.
“If you don’t build them, how can they have that sense of belongingness with the company. The company culture is the most difficult thing to imbibe because wherever you may be assigned, it is not just about technical proficiency,” says the 62-year old Jerry.
Lessons learned
What has sustained a family business that spans three generations is its focus.
“Keep your eyes sharply on the ball. Focus on what needs to be done because if you are distracted by outside noise you cannot accomplish because when you are distracted by what others say, directions can get fuzzy,” says Joel.
Simply, the elder attributed their success to the Golden Rule: “Do unto others what you want others do unto you. Just do your best for everything will come back to you so it is always our customers who kept coming back to us because we have developed good relationships with them. There is the bond, this is not just supply and leave our customers. We gave our personal numbers because we have service commitments. What if your load is ice-cream and your refrigerated van got into problem? We have to rescue you.”
If there is anyone Joel looks up to in business, it is his father Jerry, who likewise looks up to his father.
Jerry, a very religious man, always reminds his siblings that: “There is only one source. So make sure you don’t do anything that displeases him because when he pulls the plug nobody can prevent that because we are just stewards so take care of it because if you take care of it, it flows,” says Jerry, who is probably the first to arrive at work at 5:30 to 6:00 in the morning.
Joel confirms his father’s wisdom stressing they are “just stewards, not owners” of what they have. So, the most they can do is sustain it, and grow it together with everyone. That is why, even if business is hard, they have to be accountable and do their best.
“We do not make lives difficult for others. We do not steal light from anyone,” adds the 37-year old Joel.
In the next five years, he would like to see Coolaire provides more jobs to people and more services. Always, they will ensure that items delivered to customers are not spoiled because that is what they do for the last 50 years.
The father and sons have very good working relationships. The Tugade family loves to eat where they discuss business matters over lunch or dinner.
Jerry said that early on he knew that he has to leave something to his kids so the first thing he did was made them realize that “I was working hard building a company for our daily needs and I hope that it was successful enough. I don’t have to invite them into the company because it was natural for them to get in because everything that we have food and education, and all, it came from the company. So, they realized the value and labor of hard work at a very early stage.”
As the company celebrates its 50th anniversary this year, it also looks forward to build and strengthen its pathway for a bigger and better future 50 years and beyond.