Author: Mei Ling Tan

  • Australian dollar rises over weekend

    Australian dollar rises over weekend

    The Australian dollar has risen slightly over the weekend to 70.42 US cents, up from 70.22 US cents on Friday.

    The Aussie dollar also trades at 62.67 euro cents, 54.20 British pence, $1.03 New Zealand dollars, 78.24 Japanese Yen, and 4.733 Chinese Renminbi.

    Australian markets are also expected to be affected by Monday’s public holiday in Victoria, South Australia, Tasmania and the ACT.

    CommSec chief economist Craig James says its no surprise that after the losses in the US, there would be similar declines in our own market on Monday.

    “US investors are trying to mull up the state of the economy – job figures were much weaker than expected but the question is whether this is just a one off type development. And housing stats were much firmer than expected,” he told AAP.

    “So that data was more mixed than anything.”

    He said investors could expect Monday to be a little softer in terms of volume, and potentially, growth because of the public holiday.

    He said because of that, no major economic data had been released.

    But what everyone is waiting for is a development in the US-China trade dispute.

    “Without new information, we are effectively in a holding pattern.”

  • Dubai now as important as Singapore for DHL

    Dubai now as important as Singapore for DHL

    Brexit, trade wars, an economic slowdown in China and humanitarian crises on the regional doorstep – despite these headwinds, Amadou Diallo, DHL Global Forwarding CEO for the Middle East & Africa, isn’t worried. The outlook for the logistics sector in the UAE for 2019 is upbeat, DHL’s recent Global Connectedness Index put the country at number five among the most connected countries in the world in terms of logistics, and Emirates NBD’s Dubai Economy Tracker Index shows that the wholesale and retail sectors (major drivers of demand for 3PL services) are at their strongest outlook since the post-2008 years.

    There is light on the horizon, then. But, despite this, the major players in the market are worried. At the World Government Summit in Dubai, DP World chairman and CEO Sultan Ahmed Bin Sulayem hit out at the UK government over its handling of the Brexit process.

    “Our problem is the indecisiveness of the government,” he said. “We don’t care as businessmen whether they have Brexit, or Brexit with an agreement, or Brexit with a good agreement, or Brexit with a bad agreement,” he said. “Once they decide, as businessmen, we are capable of running our business once all this basically indecisive environment disappears.”

    The statement was unprecedented from one of the most mild-mannered (and most powerful) figures in the Middle East logistics industry. But, he was venting a frustration expressed privately by many executives this magazine has interviewed during the last year. The world’s sixth-largest economy is at risk of crashing out of the world’s largest trading bloc without a contingency plan in place for trade and logistics.

    As the award-winning journalist James Ball wrote in a recent CNN piece, “The world needs to start panicking about Brexit”. The UK’s crisis was therefore a natural starting point for our wide-ranging interview with Amadou Diallo, DHL Global Forwarding CEO for the Middle East & Africa – but unlike many industry commentators, he insisted there was no need for concern in this region.

    Brexit is one of a handful of challenges we’re currently facingBrexit is one of a handful of challenges we’re currently facing,” he says. “DHL’s Logistics Trends Radar has highlighted Brexit as a potential headwind, among evolving trade tensions between the US and China, and China’s own domestic economic slowdown, that will likely impact trade volumes transhipping through the Arabian Gulf.”

    “This is an evolving and dynamic market. It’s always changing.”

    According to Diallo, DHL’s history and sheer size (DHL Group is the largest courier in the world), gives it the stability and resources to mitigate these challenges. “DHL has been around for more than 24 years and we’ve seen our fair share of market shifts,” he says. “Because we’re present in more than 220 countries around the world, we’re sustainable and dynamic enough to find new solutions and opportunities amid these global dynamics.”

    For this reason, he doesn’t see DHL Global Forwarding’s regional operations being unduly hampered by Brexit, whether it be hard or soft. In fact, he suggested the process might have a positive effect on the Middle East and African markets.

    “The UK trades with many markets, our region covers anything that goes to or from Afghanistan, Turkey, the Middle East and Africa, and many countries in this region have a solid trading relationship with the United Kingdom,” he says. “So, any enterprises and people in the UK who find themselves suffering due to Brexit may look to their existing trade relationships in other parts of the world to find some measure of mitigation and stimulate these trade flows. If people are inward-oriented, trade flows are the first thing to suffer.”

    For DHL Global Forwarding itself, the uncertainty and shifting nature of supply chains will likely drive demand for its services, he added. “DHL Global Forwarding is a sizeable organisation in the United Kingdom and we’re market leaders worldwide when it comes to logistics. We do supply chain services, customs brokerage, and other services that are going to be in high demand from UK companies if a hard Brexit occurs,” he says.

    And while Brexit remains a question mark looming large over the industry, what Diallo feels is a certainty of support to the market is the EXPO 2020 Dubai, which the government is spending US $9-billion to host, as part of a wider series of infrastructure investments amounting to US $3.2-billion in 2019 alone for the UAE Vision 2021 and Vision 2030 initiatives to diversify the economy.

    Dubai EXPO 2020 is definitely an opportunity for us, for growthDubai EXPO 2020 is definitely an opportunity for us, for growth,” he says. For a company like DHL Global Forwarding, providing air and ocean freight forwarding services and major logistics projects under the brand name DHL Industrial Projects, the opportunity is two-fold. “We had this experience in Milan and in China and we shouldered the burden of getting all the goods into the country for the expo itself for countries wanting to come and promote their cultures and countries, but also for the immense infrastructure development that comes with events of this kind,” says Diallo.

    “And then once the EXPO is over, there’s a lot of material that needs to be shipped by air or sea back to the point of origin, or donated, which is often the case, to other countries,” he says. “These are operations that need to be completely flawless and it’s something that we have become very good at.”

    DHL Global Forwarding is working closely with key partners in the run-up to the event, such as Emirates SkyCargo. “Emirates SkyCargo is helping us ensure that we provide a seamless service to foreign and domestic clients ahead of EXPO 2020. They’re a key provider of air freight solutions for DHL Global Forwarding,” he said. “We operate in all the same markets as the airline and work very closely with Nabil Sultan, the head of cargo for Emirates.”

    Emirates SkyCargo, like Emirates itself and DP World’s Jebel Ali Port, has turned Dubai into a major global logistics hub, and because of this DHL is significantly expanding its operations in the city. The DHL Group at the beginning of February established its first Global Competence Centre for Humanitarian Logistics in Dubai.

    “The centre is a cross-business unit involving the entire DHL Group to help logistics companies and NGOs respond to the various disasters and humanitarian crises occurring in the region,” says Diallo.

    “The competence centre will support the work of the International Humanitarian City. We see that many NGOs and aid organisation have offices and DCs here, and so this is the ideal city to use as a logistics hub for humanitarian relief.”

    Dubai is one of three global humanitarian logistics hubs for DHL’s disaster relief teams, and this, along with the Competence Centre, underscores the city’s significance within the wider DHL network.

    “This is the largest hub we have in the Middle East and Africa region,” says Diallo. “It’s up there with Singapore, Shenzhen, Germany and the United States.”

    DHL Global Forwarding has around 300,000sqm of warehousing space in the Middle East, with 260,000sqm of that located in Dubai. It’s also in Dubai that it has the AOG competence centre for all the airlines carrying air cargo into and out of the region, and a dedicated team of 75 people working in Dubai on its infrastructure logistics solutions through DHL Industrial Projects. “With a lot of energy plants and oil & gas projects in the region, and immense infrastructure developments in Saudi Arabia and other GCC countries and in Africa, and Dubai’s global connectedness, it makes sense to concentrate a lot of these tools here in Dubai,” says Diallo.

    When it comes to infrastructure and development projects in Saudi Arabia, as part of the massive Saudi Vision 2030 plan, Diallo says this represents another major logistics opportunity. When asked whether initiatives such as the development of King Abdullah Port and King Abdullah Economic City could challenge the UAE’s logistics dominance via Jebel Ali Port, he’s more hesitant.

    “There is a long lag time between deciding on a goal and achieving it,” he says. And while the ultimate impact for the UAE may be so way away, he also doesn’t feel that the redevelopment of Saudi Arabia’s logistics industry is intended to challenge the UAE’s dominance.

    “We are actively participating in, and working on, the Logistics 2030 strategy of Saudi Arabia, which is part of the Vision 2030 initiative. I’m part of the advisory board in that effort, so we know the ambitions and goals that are being worked on,” he says.

    “The UAE has been a major driver of logistics development in Saudi Arabia organically, so many of its imports and exports still transit through Dubai and I don’t think that will change any time soon. And when it does, it won’t be a zero-sum game,” he adds.

    According to Diallo, it’s not dissimilar to the rise of Singapore and China as major economic and logistics powerhouses. “Singapore was the first major logistics hub in the region, before China was the economic giant it is now,” he explains. “China is a logistics leader now, but that doesn’t mean that Singapore has suffered or been displaced as a regional and global logistics hub. I think the same will apply here in the region.”

    In Saudi Arabia, the investments being made are aimed at supporting the domestic economy, and the Kingdom’s ability to diversify and grow. “These changes are related firstly to growing the economy to satisfy the needs of a growing population. Saudi Arabia is the largest economy in the GCC and there’s liberalisation, industrialisation, and diversification taking place,” he says.

    These changes require an evolution in the country’s supply chains and logistics networks. “It’s logistically more economically feasible to have cars assembled in Saudi Arabia than shipped via roro in a turn-key state from Japan, South Korea, and Mexico. The same goes for other consumer goods. This creates more job opportunities, and therefore more personal wealth, and therefore more demand for goods.”

    The goal then is to enable the economy to be more diverse, more self-sustaining and more stable. The changes taking place in Saudi Arabia’s logistics sector are going to boost the country’s ability to meet these targets, to become a larger, more diversified economy, says Diallo. “But it won’t take traffic or logistics capabilities away from Dubai.”

  • SilkAir boosts Phuket-Singapore flights

    SilkAir boosts Phuket-Singapore flights

    SilkAir, the regional wing of Singapore Airlines, will add a sixth daily service between Phuket and Singapore from May to meet growing demand for travel between Singapore and Thailand. SilkAir currently operates five flights per day on the popular Singapore-Phuket route, and a sixth will be introduced with effect from May 24, noted a release announcing the new flights.

    “The new service will be operated by Boeing 737 aircraft, which feature both Business and Economy Class cabins. Customers can look forward to a full-service experience, including in-flight meals, wireless in-flight entertainment on SilkAir Studio, complimentary baggage allowance as well as through check-in if they are connecting to or from another SilkAir or Singapore Airlines point via Singapore,” the release noted.

    The additional service, MI760, will depart Singapore at 9:50am (Singapore Time) and arrive at Phuket at 10:45am (Phuket Time).

    The return flight will operate as MI759, departing Phuket at 11:35am (Phuket Time) and arriving in Singapore at 2:20pm (Singapore Time). (See schedule below.)

    As the regional wing of Singapore Airlines, SilkAir extends the SIA Group’s network by seeding and developing new destinations in the Asia-Pacific, noted the release.

    The airline took to the skies in February 1989 as Tradewinds the Airline, before evolving into SilkAir in 1992. In its early days, it catered to passengers holidaying in exotic destinations in the region, including Phuket and Tioman. As the carrier developed, regional business destinations such as Phnom Penh, Yangon and Kuala Lumpur were added.

    Today, the full-service airline operates about 400 weekly flights to 49 destinations in 16 countries.

  • Dune London about to open in Singapore

    Dune London about to open in Singapore

    Footwear brand Dune London is planning to expand into Singapore and Bangkok this year.

    The brand says expansion into new international markets is one of its core strategies for this year.

    In the UK, the brand will expand its standalone store network by opening a new location in Newcastle Eldon Square and opening outlet stores in Cheshire Oaks, Icon O2 and Kildare Village.

    South America is another focus area, and Dune plans to roll out eight new concessions with its existing partner in Chile. It will also debut in Romania.

    “This is a very exciting time for Dune London, as international expansion is a focal part of our overall growth strategy,” said James Cox, CEO.

    “We will focus our efforts on specific markets with best-in-class support strategies and tactical initiatives that are regionally appropriate and perfectly aligned with our product and marketing investments.”

    Dune has opened 10 new concessions in department stores in Mainland China, two in Macau and one in Hong Kong, as well as new standalone stores in Kuala Lumpur; Ho Chi Minh City and Hanoi in Vietnam; and Manila in the Philippines.

    In the Middle East, it trades in more than 50 locations.

  • RFG totters making its way

    RFG totters making its way

    Retail Food Group remains in danger of collapse as it tests the nerve of its financiers. The multi-brand franchisor has racked up losses of more than half a billion dollars in the past 18 months; its market capitalisation has fallen below $50 million, with its share price dropping to 25¢ last week on the Australian Securities Exchange.

    Directors have been attempting to sell assets in a bid to reduce debt to satisfy bankers and ensure the company can continue to trade.

    The problem is that most of the assets have little value in real terms and, in some instances, carry significant liabilities in respect of store lease commitments, exit costs on unprofitable and unfranchised stores and prospective legal action by disgruntled franchisees.

    The results for the first half of the 2019 financial year would indicate that the entire company is struggling to survive and is facing imminent administration if it cannot quickly conclude a significant asset sale.

    Debt covenants tested

    A waiver of debt covenants by lenders NAB and Westpac expired on December 31 – and are due to be tested by March 31. Without clear indications of the viability of the company on an ongoing basis, lenders are unlikely to hold their nerve.

    Directors of the company have been unable to conclude a deal on any asset sales despite the company reporting the Donut King and QSR Division as discontinued operations in its FY19 first-half results released last week.

    Directors advised investors that negotiations were ongoing but no formal binding agreement had been achieved with a proposed buyer.

  • Reebonz teams up with Japan’s Komehyo

    Reebonz teams up with Japan’s Komehyo

    Singapore’s e-commerce platform Reebonz has partnered with Japanese offline pre-owned luxury product boutique Komehyo.

    Reebonz is expected to make Komehyo’s products available to an estimated 5.5 million members on its platform, supporting both companies’ missions to bring authentic pre-owned luxury to consumers around the world.

    “The next step for us is to continuously support their growth in sales across Asia Pacific,” commented Nupur Sadiwala, Reebonz CFO.

    “Furthermore, with the growing demand for authentic pre-owned luxury complemented by growing demand for new luxury products, we believe that this partnership will allow us to further deepen our ecosystem strategy of offering the broadest selection of quality new and pre-owned luxury products.”

    “In addition to the opportunity for us to amplify our brand awareness, we believe that by working with Reebonz, we will be able to further improve our consistency in delivering authentic high quality products to aspiring consumers across the region,” added Shinji Kai, Komehyo’s IT department assistant GM.

    Established in 1979, Komehyo currently has 40 retail stores across Japan and an online platform, selling bags, jewellery, leather goods and accessories, to watches, shoes and apparel.

  • Muji Singapore to offer home renovation products

    Muji Singapore to offer home renovation products

    Muji Singapore is set to expand its offer to include the new Muji Renovation concept. By 2025, Muji Singapore customers might be able to go to the Japanese retailer for a complete home transformation, said Satoru Matsuzaki, president and representative director of Muji owner Ryohin Keikaku.

    “I always want to bring new formats to Singapore first, develop it here, then [take] it out to the region,” Matsuzaki added.

    “Coming soon for Singapore shoppers is the expansion of the Muji Walker active wear range, launched in the 2018 Spring/Summer season and meant for light exercise.

    “This is really a good match for Singapore,” said Matsuzaki, pointing to the island’s year-long warm weather and ageing, health-conscious population.

    It also aims to expand its product range, narrowing the gap between the 7000 items sold in Japan and the 4000 here.

    Store sizes will expand as well, from an average of 6000sqft to some 18,000sqft.

    Strong sales have fuelled the brand’s confidence and the plans to expand store footprints. Despite the local retail sector supposedly being on the downtrend, Muji Singapore’s sales are rising steadily each year.

    Meanwhile, Muji is seeking a court order for Singapore retailer Iuiga to stop its use of the Muji mark and the retailer is launching first store in Vietnam next year.

    Muji Singapore opened first store in 2003, and now has 11 local outlets.

  • Consumers are in control and searching for Experiences

    Consumers are in control and searching for Experiences

    Retailers must recognise consumers are in control and they are looking for experiences above all else, according to US trend expert Tom Mirabile.

    Speaking at the International Housewares Association’s annual show in Chicago, Mirabile said housewares suppliers and retailers need to focus all their efforts on what the consumer wants, how the consumer sees themselves, and how the industry can help create solutions for them.

    “We need to stop looking at objects and start looking at what those objects deliver,” he said. “People aren’t buying objects, they’re buying experiences.”

    Mirabile began his presentation with an overview of generational distinctions and key “need-to-knows” about each generation right now. Generation Z is on track to be the most well-educated generation (according to Pew Research), with a liberal set of attitudes and openness to emerging social trends. They also may be the first generation where cooking is truly no longer a gendered task, viewing “cooking as a craft or a skill,” according to Mirabile. This generation skews more toward traditional life cycles, with many saying they want to start a family and own a home.

    A much less traditional generation, millennials prefer staying home over going out. But they’re less likely to eat around the kitchen table; many eat in their bedrooms and even bathrooms. They also report replacing one meal a day with snacks.

    Another way of bucking the norms: “Millennials don’t see a brand as religion,” said Mirabile. “Loyalty does exist, but you have to constantly earn it.”

    Generation X is smaller in numbers but is entering its prime earning years. Thirty-one percent of discretionary spending in the US right now is coming from this generation, Mirabile said.

    Gen X is very self-sufficient and does more product research than any other generation. They’re also a true shopping hybrid; they still enjoy a trip in-store but have fully embraced online shopping.

    Many Baby Boomers are retiring, moving or remodeling their homes, which means they will be buying more items for their homes. Many are also in a period of personal reinvention. “Boomers are still looking to Millennials and Generation Z to see what they want to be,” Mirabile said.

    As for seniors, many are still economically active but much of their consumption has shifted to experiences and healthcare. By 2035, one in three US households (versus today’s one in five) will be headed by someone over 65 years old.

    Next up, Mirabile shared some key tenets that are important for housewares suppliers and retailers as they adjust to the quickly-changing marketplace where consumers hold all the control. He tied them to the acronym ‘FASTR’:

    F – Be flexible, be fun, be fearless. Change is constant, but even the most established brands can reinvent themselves. Mirabile cited Ikea and KitchenAid as examples. He also cited recent amusing commercials from Skittles, Wayfair and Geico, “(Brands) who can have fun and make fun of themselves send a message of self-confidence,” Mirabile said. And be fearless – don’t be afraid to take a stand or do something different from the norm. It helps make your brand feel authentic and helps you stand out from the crowd.

    A – Be addictive, be aware, be aspirational. American adults spend more than 11 hours per day listening to, watching, reading or generally interacting with media, according to the Nielsen Total Audience Report. The challenge is in hooking them in. Be aware: there’s a tremendous amount of information out there, but “you’ve got to be self-educated, you’ve got to be a culture vulture,” said Mirabile, and keep up with what consumers want. Be aspirational: “Today’s consumer doesn’t dream of owning, but of becoming,” said Mirabile. “Stop telling the customer who you are and start telling them you know who they are.”

    S – Be surprising, be shareable, be simple. The subscription e-commerce market has grown by more than 100 per cent a year over the past five years, said Mirabile. A reason? They deliver boxes of surprising items a consumer may never had found on their own (or without a lot of time and effort). Be shareable: these days, this doesn’t simply mean sharing an image, though that still does have value. It’s more about inspiring people to physically share something, such as the opportunity for a family to cook and eat a meal together. And be simple: “Instead of big claims, sometimes it’s about the little obsessions,” was a finding shared from PHD Worldwide.

    T – Be true, be transparent, be trustworthy. Consumer trust levels are at an all-time low, whether it comes to government institutions, businesses or media. Be transparent: This is important whether you’re talking about ingredients, labor usage, or product materials. Significant numbers of people across all generations will pay more money for eco-friendly materials, said Mirabile. Be true: this often starts within your own company culture and then rises through the ranks of everything you do.

    R – Be real world, be responsible, be reactive. “To me, this is all about looking at real-world problems people are having, and how you’re going to solve them for them,” said Mirabile. Be responsible: a large part of this has to do with sustainability, a key issue for many generations of consumers these days. Be reactive: getting negative reviews? You must be quick to react, explain and make things right online. eMarketer data finds that roughly two-thirds of US internet users reference product reviews at least often before making a purchase.

  • South Korean K-pop merchandise sales surge to US$132 million

    South Korean K-pop merchandise sales surge to US$132 million

    South Korea’s K-pop merchandise market is booming, reaching KRW 150 billion (US$132 million) last year.

    Led by the recent global fame of BTS, K-pop’s popularity has expanded far and wide, and a growing number of fans are enthusiastically spend their time and money collecting even the smallest souvenirs that remind them of their favorite pop stars.

    Mugs, notebooks, pens, bags, T-shirts, tumblers and slippers with photos of BTS, EXO, Blackpink, Twice and the like all stir K-pop fans’ desire to be closer to the performers they like the most.

    “I spent more than 1 million won ($881) buying BTS merchandise last year,” one BTS fan told Yonhap, requesting anonymity. “Sometimes even I think it’s a bit excessive, but it’s one of my big hobbies.”

    According to the latest data from the Korea Creative Content Agency (KCCA), the total sales of the South Korean music industry reached 2.87 trillion won in the first half of last year, up 9.2 per cent from a year earlier.

    K-pop merchandise sales of 150 billion won last year alone includes privately created items and pirated goods.

    “Fans with huge loyalty to their singers buy albums and goods together. Many of them create unofficial goods too,” said Sung Mi-kyoung, a senior researcher at the KCCA. “The idol culture started to explode in the latter half of 2017 on the back of the rising global popularity of BTS. Estimates of 150 billion won in sales are not groundless.”

    She said the three leading music labels — SM Entertainment, JYP Entertainment Corp. and YG Entertainment Inc. — have already acknowledged the potential of the goods market and started to rack up revenues there.

    According to their regulatory filings, the three listed companies’ combined sales of albums and digital music content reached 76.69 billion won in the first half of 2018.

    And they posted a combined 105.44 trillion won in sales from K-pop merchandise, royalties and other fees over the cited period.

    YG alone earned 76.91 billion won in royalties and brand-related sales as the company runs fashion and cosmetics subsidiaries using artist brands like Big Bang, iKon and Blackpink.

    SM, which manages Exo, Shinee and Super Junior, runs its official merchandise shops SUM Market and SMTown Gift shop in southern Seoul, selling collaborative products combined with its artists’ brands.

    “It has been a minor culture among young fans of K-pop,” said Sung. “But from now on, its huge potential will attract the entire entertainment industry to focus on this market.”

    She said 50 per cent of South Korean teenagers have bought a K-pop item at least once.

    “These young teens who are very willing and familiar with spending money on goods related to their idols will grow up and have greater purchasing power when they become 30-somethings or 40-somethings.”

    Against this backdrop, the K-pop market is broadening into a comprehensive content industry linked with performance, fashion, food, tourism and even manufacturing.

    Tens of money-making goods and events can be derived from a picture of a K-pop singer, she noted.

    “People do not only consume music to listen to but also enjoy such entertainment in other forms. The music industry now comes with concerts, merchandise and intellectual property,” the KCCA expert said. “I hope the public sector will fine-tune the legal issues involving intellectual rights to level the playing field and foster the content industry further.”

  • Pomelo Fashion Beefs Up Management Team with Key Hires from Across SEA

    Pomelo Fashion Beefs Up Management Team with Key Hires from Across SEA

    Pomelo, a leading omnichannel fashion company headquartered in Bangkok, announced the appointment of Jim Boland, former CFO of RedMart, to Pomelo’s core team as its new CFO. As part of Pomelo’s strategic approach to recent key hires, Boland’s appointment will see him
    building up Pomelo’s financial infrastructure to drive profitability while enabling rapid growth across the region. Boland has successfully led finance organisations in fast-growing ecommerce businesses for over 19 years in leadership roles at Amazon, Dell and Alibaba-owned RedMart.
    ”I am delighted to join this innovative company which has designed a business model strategically suited to grow fast and profitably.

    As a digitally native, vertically integrated omnichannel brand, Pomelo presents an exciting opportunity to leverage my past experience with vertical integration, retail, and ecommerce, especially during the critical scaling up phase.” said Boland. With Boland’s new role as CFO, Pomelo’s Co-founder and former CFO, Casey Liang transitions to enhance Pomelo’s growth team which encompasses the performance marketing and business intelligence teams. This cross-functional team will work closely with the engineering, design, and product teams to accelerate customer acquisition and retention.

    “As we continue in this period of rapid expansion, I am excited to foster more coordination between our creative and technical teams to further accelerate our growth rate and help more customers to experience Pomelo’s unique value proposition“ said Liang. Commenting on Pomelo’s spate of new hires, David Jou, CEO of Pomelo says “We’re excited to have Jim on-board as we continue on the path of building the first global fast fashion brand out of Asia.” Jim Boland’s appointment reinforces Pomelo’s commitment to investing in key talent across Southeast Asia.

    In Q4 2018, Pomelo also welcomed aboard Cathriona Nolan as its AVP of Creative Operations, and Vorada Hiransomboon as its AVP of Buying. Previously from Burberry, Nolan brings extensive creative experience in brand development and marketing to the table to strengthen Pomelo’s creative direction, while Hiransomboon, most recently former Head of Buying at Inditex, leads the buying and merchandising team with her keen knowledge of market trends and efficient supply chain management.

  • Grab now has more rivals than ever before in Vietnam

    Grab now has more rivals than ever before in Vietnam

    From an e-hailing app, Grab has made great steps forward, providing many different services. Most recently, it started the payment service GrabPay and lending service Grab Financial.

    The consumer lending market in South East Asia is very large. As estimated by the World Bank, about 2 billion people in the world cannot access bank services, and most of them are in Asia Pacific.

    The non-cash payment market, according to Grab, is worth $500 billion in South East Asia.

    An analyst commented that Grab is wise taking a ‘roundabout’ approach to consumer lending (it conquered the transport market first before aiming for the consumer credit market).

    Consumer lending is a fertile business field for Chinese e-commerce firms. The firms offer online payment apps to users to ‘learn’ about their financial capability.

    Grab, as an app, quickly attracted users, especially investors. Just within six years, Grab became an unicorn company, i.e. an unlisted technology firm with valuation of $1 billion and higher, in South East Asia. Analysts estimate that Grab is valued at $6 billion.

    The total number of Grab downloads has reached 95 million all over South East Asia. This could serve as the launch pad for it to conquer the consumer lending market.

    The challenges 

    “GrabPay e-wallet will be used for both transport and food delivery services, two of the most used services in South East Asia,” said Jerry Lim, director of Grab Vietnam.

    However, the analyst said, by expanding its business, Grab would have to compete with more rivals who are ‘powers’ in their fields. In online payment, for example, it will have to compete not only with AirPay (Sea) and Alipay (Alibaba Group), but also with local firms such as ZaloPay (VNG) and MoMo.

    In Indonesia, Grab bought an e-commerce platform, Kudo, in April 2017. Grab believes that this is the factor which can help expand GrabPay. However, in Vietnam, Grab’s two big rivals – Sea and Alibaba — both have strong support from two popular e-commerce floors – Shopee Vietnam and Lazada Vietnam.

    Similarly, GrabFood has rivals in the food delivery sector, where Sea’s Now, which inherited the large custom from Foody, is the leader.

  • SingPost Looks to Plug Last-Mile with More Delivery Options

    SingPost Looks to Plug Last-Mile with More Delivery Options

    The resurgence of e-commerce in Southeast Asia has helped mitigate the decline in postal mail volumes, but it has also raised last-mile delivery challenges. To address this, Singapore Post (SingPost) is looking to build up its network and offer more options for consumers to receive and send packages.

    Established more than 160 years ago, SingPost in 2016 launched its Regional E-commerce Logistics Hub, which has a sorting capacity of 100,000 parcels a day. Parcel volumes in November 2018 climbed 25% year-on-year and the highest volume of parcels processed in one day clocked at 40,000. During the peak period of November to December 2017, some 2,700 tonnes of parcels were delivered.

    In this Q&A with Retail News, SingPost’s group chief digital and technology officer Alex Tan discusses how the postal service provider has been working to keep pace with the region’s e-commerce boom and address challenges in last-mile delivery.

    In what ways have the rise of e-commerce impacted SingPost and the company’s growth and technology roadmap?

    Alex Tan: E-commerce presents a huge opportunity for us and we are driving a lot more e-commerce traffic through our postal and logistics networks. This mitigates the decline in letter mail volumes that is seen all over the world.

    It’s also why we are progressing on a three-year transformation strategy to shore up our footprint in e-commerce logistics. Our vision is to be the regional last-mile delivery and urban logistics platform of choice for Southeast Asia. Our current suite of e-commerce logistics solutions includes frontend web management, warehousing and fulfilment, last-mile delivery, and international freight forwarding.

    In November 2018, we unveiled our latest next-generation logistics platform Last Mile Platform (LaMP), which consolidates various last-mile delivery services such as courier services, parcel lockers, and brick-and-mortar collection points, onto a single platform. Being technology-agnostic, LaMP can integrate services from different retailers and logistics providers to provide greater convenience, flexibility, and control to customers.

    The platform is also location-agnostic and can connect last-mile partner services across Southeast Asia. Through LaMP, retailers can offer their customers the ability to receive their online purchases via any last-mile delivery node in the network, in any country within the region. Consumers may even redirect en-route deliveries to an alternative delivery node on the platform.

    In 2016, we also opened our SGD$182m (£104.08m) Regional E-commerce Logistics Hub, which is fully automated and harnesses the latest warehouse fulfilment and parcel sorting technologies, integrating warehousing and parcel sortation systems for greater efficiency.

    We are also building on our partnerships with our major shareholders, Singtel and Alibaba Group, working closely with them on cross-border e-commerce and digital innovation, in areas such as big data, warehouse robotics, and artificial intelligence (AI).

    There has been numerous customer feedback on SingPost’s delivery service, most of which revolved around non-deliverables or failed/missed deliveries even when the recipient was home. What challenges does SingPost face in fulfilling the last-mile delivery component, which is especially crucial in e-commerce, and how are you looking to resolve these with technology?

    Providing integrated solutions for last-mile delivery is one of the biggest challenges faced by postal and logistics providers. To improve the last-mile delivery experience, we have installed over 160 POPStation parcel lockers across Singapore. These enable our customers to collect, return, and ship parcels at their convenience. In addition, we are working with the Infocomm Media Development Authority on a pilot for the Locker Alliance, an open access delivery network of 43 lockers in Punggol that residents can use to receive and return parcels conveniently, regardless of which logistics firm handles the delivery. We continue to expand on our network of parcel lockers, installing them in more housing estates and developing new features that facilitate e-commerce services beyond online shopping.

    To enhance customer experience, service quality, and operational efficiency, we launched SmartPost in November 2018, which is an integrated suite of solutions that harnesses mobile and digital technologies. In the current phase, it enables better tracking of deliveries and electronic signing-over of registered mail. It also upskills our postal staff with new tools and technologies that elevate their efficiency and capabilities. To date, we have equipped all of our 1,000 postal employees with a proprietary mobile app that works with Near Field Communication (NFC) tags installed at around 15,000 delivery points across the island.

    Looking ahead, we are working towards providing delivery alerts and status updates to customers via SMS or email, as well as electronic notifications, to collect missed deliveries – replacing physical delivery notes that are currently used.

    In addition, LaMP will augment the online shopping experience, empowering customers with greater choice of delivery options and collection locations, including the option to make changes while a delivery is underway. Leveraging AI, LaMP will soon provide customers with SMS alerts half an hour before their courier arrives.

    With customers today wanting a more seamless, digital experience, we are expanding our Smart Post Office network, which combines our physical branch network with our SAM Omnichannel platform, It comprises self-service kiosks, mobile app, and web portal.

    How has the introduction of drone deliveries improved the last-mile fulfilment? Can you provide an update on SingPost’s deployment of drone deliveries?

    There is huge potential in UAV (unmanned aerial vehicle) technology to provide game-changing urban logistics solutions for last-mile e-commerce and mail delivery in the future. We are working with Airbus’ Skyways project to explore how drones can be used to move collect and deliver items autonomously within cities. After a successful flight demonstration in February 2018, we are working towards operating a trial e-commerce delivery service at the National University of Singapore in the coming months.

    Alibaba made significant investments in SingPost in 2014 and 2015. How have the funds been deployed and how has the partnership materialised in terms of the number of deliveries SingPost fulfils from Alibaba’s online marketplaces?

    We have been working closely with Alibaba and its extended ecosystem, which includes Cainiao Network, 4PX, and Lazada.

    Together, Alibaba and its ecosystem have brought in significant cross-border e-commerce volumes for SingPost. We also are collaborating with Alibaba and its technology affiliates on several projects involving AI, warehouse robotics, big data, and cloud computing with the aim to create more opportunities for us to digitally transform our business.

    Alibaba’s investments into SingPost are focused on strengthening our regional e-commerce logistics infrastructure and network, so we can grow and enhance our e-commerce logistics capabilities to better serve the region’s rapidly growing online retail markets.

    What new technologies are you looking at in the next year and how will these be deployed at SingPost?

    We are integrating AI into LaMP to provide parcel traceability and reliability for our customers across Southeast Asia.

    The platform will be able to autonomously plot optimised courier delivery routes based on multiple factors such as parcel destinations, customers’ preferred delivery times, and real-time ground data including traffic and weather conditions. It will be able to analyse and proactively alert all stakeholders on courier movements, and allow customers to receive an alert half an hour before their parcel arrives. This a significant improvement in terms of convenience, especially in dense cities such as Bangkok and Jakarta, where customers are typically provided vague parcel arrival times due to myriad reasons such as traffic jams and extreme weather conditions. On LaMP, all of these will be managed from a single screen called the ‘control tower’, providing enhanced visibility and connecting multiple GPS-tracking systems and APIs.

    On a personal note, when you buy something online, what kind of services do you think these sites should provide in terms of delivery/logistics?

    People want flexibility and control, whether it is choosing the time and location or the mode of delivery, and with the option to change your mind along the way. There is growing agnosticism with regards to geography, where e-commerce shoppers want to be able to shop at online stores in any country and expect a seamless experience no different from buying on a domestic website.

    This calls for a transformation of the logistics industry, and it is why SingPost is harnessing digital technology across the entire supply chain – from transforming our last-mile infrastructure for greater efficiency and responsiveness, to creating agile and open platforms that integrate delivery networks across organisations and geographies.

  • Lion Air offers discounted flight tickets from Jakarta to Medan

    Lion Air offers discounted flight tickets from Jakarta to Medan

    Following Garuda Indonesia’s recent decision to lower its ticket prices for flights connecting Jakarta and Palembang, South Sumatra, the country’s largest low-cost carrier, Lion Air Group, announced a promotional program called #liburanmakinmurah (vacationing gets cheaper)  that will start on Friday.

    According to Lion Air statement, the airline will offer 50 percent discounts on a number of domestic routes, with flights from Jakarta to Medan, North Sumatra, for example, starting from Rp 880,000 (US$62.54) and flights connecting Jakarta and Jayapura, Papua, starting from Rp. 2.28 million. These prices do not include both excluding passenger service charges (PSC), value-added taxes (PPN) and insurance.

    “This move is part of Lion Air’s efforts to support the government’s campaign to increase foreign and domestic tourist arrivals, therefore, boosting both the local and national economies,” the statement read.

    The promotional tickets can be purchased on the airline’s official website, Lionair.co.id, ticketing offices and travel agencies.

  • Hanoi office rental yield highest globally

    Hanoi office rental yield highest globally

    Hanoi offered the highest grade A office rental yield in the world last year — 8.57 percent, a Savills report said. This was the third straight year the Vietnamese capital ranked top, according to the British property consultancy, which used data from the second half of 2018.

    Hanoi recorded a 3 percent year-on-year increase in average gross rent in the last quarter of 2018 and a steady occupancy rate of 95 percent.

    Philippine capital Manila, Australia’s Adelaide, Vietnam’s Ho Chi Minh City, and Australia’s Perth round out the global top five.

    HCMC, the previous runner-up, dropped to fourth place with a yield of 7.36 percent.

    HCMC has been performing outstandingly in the last five years, with average rents growing at 8 percent a year and a very high occupancy rate of 97 percent.

    “The fact that Hanoi and HCMC are among markets that offer the highest yields globally shows healthy rent and occupancy prospects for the two cities,” Hoang Nguyet Minh, investment manager at Savills Hanoi, said.

    The two Vietnamese cities have been enormous interest from international investors, particularly Singaporeans, Japanese and Koreans, Minh said.

    In the 12 months since the second half of 2017, office space attracted the largest global investment — $340 billion, according to Savills.

  • VinFast rolls out its first made-in-Vietnam car

    VinFast rolls out its first made-in-Vietnam car

    Vietnam’s first full-fledged carmaker has started trial runs in its Hai Phong factory, preparing to deliver preordered vehicles later this year. The Lux SA 2.0 SUV, which has a 228 horsepower engine and an 8-gear automatic transmission, started its first run Wednesday at VinFast’s factory in the northern port city of Hai Phong.

    Commercial versions of both the SUV and a sedan will be delivered in the second and third quarter this year to customers who have pre-ordered.

    VinFast, a unit of Vietnam’s largest private conglomerate Vingroup, claims to be the first auto manufacturer in Vietnam with a closed, synchronous and complete cycle of production.

    The first cars will be tested in several countries including Australia, Austria and South Korea to make them European standards. They will also be tested in Vietnam for endurance in various climates and conditions.

    VinFast showed off prototypes of its first two car models at the Paris Motor Show in France last October, just a year after the company’s incorporation.

    A limited edition of its Lux SA 2.0, called the Lux V8 with a 455 horsepower V8 engine, is being displayed at the Geneva Motor Show 2019 this week.