Crystal Soap & Precision Manufacturing

Written by Peter Li-Chang Kuo

Mencius once said: “When the Most High is about to place a great responsibility on a person, it first frustrates their spirit, exhausts their muscles and bones, starves their body, impoverishes them, and thwarts their plans. By doing so, it stimulates their mind, strengthens their resolve, and enhances their abilities.” (Gaozi II)

In extremely harsh environments, if there is indeed a selection by the Most High, those who can respond to challenges, even when facing the most difficult tasks, can still overcome all obstacles and fulfill their missions.

Today, someone mentioned that "Namchow Crystal Soap" is beneficial for people with sensitive skin. Namchow Crystal Soap is made from coconut oil, palm kernel oil, canola oil, and lye (sodium hydroxide extracted from sea salt). But for me, it was a tool I used for precision metal processing lubrication, which prevented American investors from failing in Taiwan and ultimately turned around the fate of a poor family. This led to the birth of “Taiwan’s Precision Industry,” the global e-commerce industry, and the cashless system, benefiting local communities and contributing to the world, writing a legendary chapter in the story of Taiwan’s experience—an achievement of extraordinary significance.

Fig 1: Young A-Chang creating

Taiwan

’s precision industry in a small sugarcane board factory

In January 1965, the Republic of China welcomed a new Minister of Economic Affairs—Mr. K.T. Li. Upon taking office, Minister Li immediately announced the construction of the “Kaohsiung Export Processing Zone” (KEPZ). After reading this news in The "China Daily News," I began diligently honing my skills every day because I heard that Americans would be coming to invest in the KEPZ and would need "super-fine eyelets"—which were exactly what I had already spent two years perfecting.

In November 1965, I unexpectedly fled with my father from Tainan to Kaohsiung and rented a small house at No. 16, Zhongxing Road, Lingya District. I fenced off a small space in the backyard using sugarcane boards to create a small factory, which I named "Cheng Kuang Metal Works," and continued to pursue my dream of doing business with Americans using super-fine eyelets.

However, no one came to buy my super-fine eyelets. I could only make products for markets, dance halls, and temples to earn enough to support a family of nine.

Fig 2: Li-Chang Kuo’s super-fine eyelets from the 1960s

My father only got into the little sugarcane board factory once, saying he was "about to suffocate!" He left in less than a minute. The sugarcane boards were so crude they couldn’t even have windows, and the factory was a sealed space. Yet, it became the training ground where young Ah-Chang would one day change Taiwan’s destiny and influence the outcome of the U.S.-Soviet space race.

The idea to develop super-fine eyelets came from a man who claimed to be a procurement officer from Tatung Company. He came to Chong-An Street in the North District of Tainan and said his company needed “air conditioner heat dissipation fins.”

My father, who had AB blood type, had a habit—if anyone told him, "No one else can make this thing!" he would immediately abandon the products that provided our livelihood and go study how to make that impossible thing.

Soon, I helped him successfully manufacture the heat dissipation fins. The two of us, like fools, carried a large carton filled with samples and took the last train from Tainan to Taipei, shaking all night until dawn.

When we arrived at Tatung Company in Taipei, we realized we had been completely tricked. The two of us, drenched in sweat, carried the heavy carton from Yan-Ping North Road all the way to Taiwan Sanitarium and Hospital (now Taiwan Adventist Hospital), where we borrowed money from a distant uncle to buy tickets to return to Tainan.

This distant uncle was my father’s classmate, and his wife was the daughter of my grandmother's brother (my great-uncle). My father was their match maker. They warmly welcomed us to stay overnight.

That night, the electrical expert uncle and my father labored to move the large wooden cabinet called a "television set." He unscrewed the back panel with a screwdriver, pointed to the dense array of components inside, and said, "A-Kun, making these parts could be profitable..."

Surprisingly, that night was the only time my father ever saw the inside of a television. I only noticed the many heated vacuum tubes.

When we returned to Tainan, my father again organized a mutual aid association at the Yamuliao Market. I was pulled in and out, and soon another set of machines and molds appeared.

However, when we placed copper material into the processing position, we couldn’t form the product. My father tilted his head, puzzled, saying, "Okashi ne? (How strange?) We can draw heat dissipation fins, but why can’t we draw this fine eyelet?"

After studying it for some time, we discovered that the lubricant used for making heat dissipation fins could be ordinary machine oil because the diameter was larger than the length—which I later called "shallow-drawing."

But the tiny part for the television had a length greater than its diameter—which I later called a "deep-drawing."

We deduced that the thickness of the machine oil was affecting the processing. At first, we tried diluting it, but it still didn’t work. Then we tried using peanut oil, but although it began to show the shape of forming, the results were still unsatisfactory. So we kept looking for other lubricants.

A few days later, my father suddenly had a wild idea—"let's try using soap!"

So, I went to Auntie A-Guo's store across the street and bought all kinds of soap on credit.

But simply mixing soap with water didn’t improve lubrication at all.

One day, when I came home from school, I saw a pile of pots in the house. My grandmother was cutting various brands of soap into slices and boiling them in pots.

At that time, there were three families living on Chong’an Street No. 45. The neighbor in the middle, Mr. Luo Yang, walked by and commented: "Ah! A-Kun has gone mad!"

Indeed, my father, with his AB blood type, truly was an extraordinary person.

After the soap slices were boiled with water and left to cool overnight, they transformed into a "jelly-like substance." A few spoonfuls diluted with water were tested, and it turned out that Namchow Crystal Soap provided "the best lubrication effect." With this, the newly developed deep-drawing "super-fine eyelet" could finally be successfully drawn and formed into a sample. However, year after year passed, and no one came to buy it.

Fig 3: Namchow Crystal Soap is now still available

Most importantly, before the graduation songs rang out in June 1965, I had already developed the ability to independently manufacture extremely complex precision molds, quickly disassemble and reassemble machines, calibrate equipment, and assemble automatic feeding mechanisms to produce one super-fine eyelet after another.

There was a reason for this ability to “quickly disassemble and reassemble machines.” Due to my father’s “spy case,” ever since his lawyer Mr. Li Mo—the father of Lee Chien-Fu, author of "Descendants of the Dragon"—left for studies in the United States, my father, who did not understand Mandarin, kept losing his lawsuits. This was one of the reasons why every time he received a court summons, he would collapse in the corner cursing loudly, and then find someone to move away the machines he relied on for survival.

The final set of machines my father built came with his strict instruction: I must be able to disassemble and reassemble them within one hour, so we could be ready to flee at any moment. Because disassembled machines would be easier to transport.

Later, I truly used this automatic punching machine, equipped with the “U-shaped replication method” progressive die I invented, to lift my family out of poverty and restore the honor my father had lost.

Fig 4: The automatic press machines modified by Li-Chang Kuo to achieve prosperity

After we moved to Kaohsiung, my father disappeared every day—perhaps modern doctors would diagnose it as "depression." I had to manage everything at our house on Zhongxing Street No. 16, including taking care of my two little brothers who were not yet in elementary school. Every night when my father returned home, he would sigh, “Such bad luck! All we make is junk!”

Even though no one came to buy my super-fine eyelets, I still treated the machine as a treasure and used it to produce "rings, tie clips, chains, lamp holders, lamp bases, hinges," and other items. After my father was maliciously arrested and imprisoned in Hsin-Sheng Street Jail, whenever my mother came to take money, I would never let her leave empty-handed—at least I gave her seven or eight hundred dollars, sometimes as much as five or six thousand.

At that time, the monthly wage for a duck feather plucker at the Kuo Min Market was just NT 30 dollars, and a piece of land next to Shengduo Theater cost less than NT 200 dollars per ping.

Every morning at 2 a.m., I would go to the Kuo Min Market to help Chen Yanding at his duck stall slaughter ducks and inject water—this provided me with a steady income. Every afternoon, I worked in the sugarcane board factory on Zhongxing Street, often working at least 20 hours a day.

"News Taiwan" continuously reported on the Kaohsiung Export Processing Zone, but every time I went south on Cheng-Kong Road to buy second hand materials on Park Road, I never once found the export processing zone. I asked many people, but no one knew where KEPZ was.

However, at the second hand or hardware stores, I would always take out my self-made super-fine eyelet from my pocket and introduce myself: "My surname is Kuo. I make these. You can find me at the Kuo Min Market." Every person who received the sample would exclaim in surprise, "Wow! This is so tiny!"

I never dared slack off, always honing my skills in preparation for the dawn of new opportunities. At the same time, I worked to improve the defect in my father’s compass-drawn progressive dies that could not support mass production—his dies would break after making just 100 eyelets.

In the suffocating, poorly ventilated sugarcane board factory, I finally developed the “U-shaped replication method.” Using just a small drill press, I created progressive dies that not only required no adjustments (unlike my father’s designs) but were later proven capable of producing up to one million units.

Fig 5: A small drill press for making precision progressive dies

Of course, it was the boiled Namchow Crystal Soap that played a key role in lubrication throughout this process.

Back then, the quality of copper material was quite poor. I worked with Mr. Chen, the owner of Jin Quan Cheng, to study how to increase the length—from one meter to six meters. The copper sheets he provided were 150 mm wide, while I only used a width of 10 mm, meaning the sheet needed to be slit into 14 strips. Each time we slit the copper sheets, which were 0.15 mm thick, they often split into three or four layers—this would damage the molds and affect product quality. Therefore, the lubricating effect of Namchow Crystal Soap played a critical protective role in the production process.

After persisting until December 1966, I finally closed a deal using my hand-made super-fine eyelets with the American company Transworld Electronics Co., Ltd. The client even asked me not to disclose it because the super-fine eyelets I sold him were considered “Top Secret.” Several years later, the American client told me:

"Because of your super-fine eyelets, Apollo 4 was able to launch successfully. It helped America win the space race. You were the only person in the world at that time who could make qualified eyelets."

"Eyelet" (in English) and "ハトメ" (Hatome in Japanese) are simply different names for the same component.

In the following two years (1967-1968), I seized the final golden era of vacuum tubes, earning hundreds of thousands of dollars per month on average. I used this income to build the first house for the Kuo family on Lane 451, Park Road, after our family estate had been destroyed by servants and Japanese occupiers.

Although by 1969, the elimination of vacuum tubes caused all my clients to lose their businesses, I was still able to help them develop new products for free. For example, I helped Mr. Chen Yon-Tien from Hsing Fu Electric Company—who had supported me in difficult times—when his factory director Mr. Zhuang came to Cheng Kuang Metal Works almost daily for help. Their newly developed plastic electric fans sent to the U.S. all broke. I actually had the ability to help them traveling to New York to handle the aftermath and even secured a sample of a transistor portable recorder. The success of this transistor product helped drive Taiwan’s economic growth throughout the 1970s.

Fig 6: "Lucky" brand transistor portable recorder

Because of the surge in “transistor product orders” coming to Taiwan, Japanese suppliers began to act unpredictably—raising prices without warning or cutting off supplies entirely. After much consideration, I decided to launch a factory expansion ahead of schedule, building three factories on Lane 360, Chong-Cheng South Road, Yong-Kang.

At that time, the only other company on Lane 360 was Cheng Yi Carton Company. Its chairman, Mr. Chang Li-Tang, came to see what I was doing and was surprised to find that the three factories producing different types of materials were all built by the same person—me. We became friends. Unexpectedly, the following year (1973), he was elected as “the mayor of Tainan City” and hoped we could help establish a sister city relationship with "San Jose," California. Through mutual visits, everyone soon learned that San Jose is the center of Silicon Valley, sparking the "Sleepless between Taiwan and Silicon Valley" and writing a new chapter for The World’s Technology Capital.

There was a popular saying: "The tech-capital is in Silicon Valley, and the technology of Silicon Valley came from Cheng Kuang."

One day, someone gave me a phone call from the factory, trembling with fear, saying: “A senior official from the Executive Yuan had arrived." I rushed over and found it was Dr. Mei Ke-Wang, Secretary-General of the Youth Corps (also known as Principal Mei), who came to understand our situation. Years later, Dr. Mei told me that my father, who couldn’t control his boastful tongue, had bragged about buying a large piece of land, which led to a blackmail letter being sent to the secret police.

Fig 7: Dr. Mei and the author—friends for over half a century

When I showed Dr. Mei the "deflection yoke production process," he noticed some liquid spraying out during processing and asked, “What is that?” I replied, “Special formula solution.” In fact, it was just a lubricant processed from Namchow Crystal Soap.

Fig 8: The Yoke for those electronic alliances

When I was later drawing "ultra-fine copper wires" thinner than a human hair, sharp-eyed Dr. Mei again noticed the “special solution” and laughed, “That’s your special formula too, right?” In short, the lubricant derived from boiled Namchow Crystal Soap far surpassed other oils in precision metal processing, especially in deep drawing and fine drawing. Additionally, since metal parts must undergo cleaning and electroplating after processing to be used in electronic appliances, this “special solution” didn’t leave sticky residues and was easy to clean, which greatly improved plating quality. It also had a balanced sugar hydrocarbon structure, making it more environmentally friendly. Most importantly, the cost of this “special solution” was so low it was practically negligible.

While many people were trying to flee Taiwan after the Republic of China withdrew from the United Nations, I had several reasons to continue and, in 1974, established "Cheng Kuang Precision Industrial Co., Ltd." at No. 61, Central Road, Yong-Kang. Premier Chiang Ching-Kuo himself came to visit.

He asked me, “Tell me in the simplest sentence—what does precision industry do?” After thinking for a moment, I replied, “It makes things very small!” He not only encouraged me to use our technology to assist the government with people’s diplomacy but also sent me a plaque inscribed with “Utilize Resources for the Benefit of All.”(利用厚生) He publicly declared, “Kuo Li-chang is the father of Taiwan’s precision industry and is exceptionally skilled at using resources to benefit the people!”

Shortly after, a team from the Chung-Shan Institute of Science and Technology (CSIST) came to study how to implement Premier Chiang’s "autonomy national defense policy."

The boiled Namchow Crystal Soap helped me establish Cheng Kuang Metal Works, which secured an American entrepreneur who had brought all his belongings and US$ 100,000 to Taiwan to start his business. Thanks to our support, he was able to begin shipping right after the Kaohsiung Export Processing Zone (KEPZ) opened. He later became Taiwan’s 25th Outstanding Exporter and successfully listed his company in the name of "Avnet Inc." on the New York Stock Exchange (NYSE) through Cheng Kuang Precision Industrial Co., Ltd., eventually becoming the Global Channel Master.

All of these experiences allowed me to later move to Taipei, where I taught the next generation precision manufacturing techniques. The “special solution” continued to be widely applied. Most importantly, I helped my fellow countrymen change their mindset—expensive materials are not always the best solution.

Donald Trump often sent me emails saying: “I need your advice!” Since last November, I’ve truly been providing him with "IIA-TES" recommendations, advocating for the advancement of technical education and precision manufacturing to support the “MAGA” (Make America Great Again) policy.

Recently, Treasury Secretary Scott Bessent finally mentioned “Precision Manufacturing” for the first time in a meeting.

Conclusion

Dr. Mei once said: “You are chosen by God to do His work and bring blessings to the world.” This perfectly aligns with Mencius’s philosophy of personal growth through hardship.

Confucius said: “It is people who glorify the Way.” Because I grew up aware that my family could be destroyed at any time, I began diligently training in 1962. By chance and persistence, I was able to create Taiwan’s Precision Industry. After the coup within my family that cost me my property and Cheng Kuang Company, I was still capable to move to Taipei, open classes, and widely teach precision manufacturing techniques. And then, I accumulated resources to pursue “Social Responsibility Investment” (SRI), eventually creating the deeply influential e-commerce industry and cashless transaction system. Through years of advocacy at APEC conferences, this system became one of the highest-value industries in human history, generating massive job opportunities and benefiting people around the world.

Peter Li-Chang Kuo, the author created Taiwan's Precision Industry in his early years. Peter was a representative of the APEC CEO Summit and an expert in the third sector. He advocated "anti-corruption (AC)/cashless/e-commerce (E-Com)/ICT/IPR/IIA-TES / Micro-Business (MB)…and etc." to win the international bills and regulations.