Retail News CRM

Author: Mei Ling Tan

  • Singapore inflation rises 0.6% in November

    Singapore inflation rises 0.6% in November

    Singapore’s headline consumer price index (CPI) rose a slightly-faster-than-expected 0.6 per cent in November from a year earlier, data showed on Tuesday (Dec 26), as private road transport costs edged higher.

    That is the fastest year-on-year increase since July, when headline CPI also rose 0.6 per cent from a year earlier.

    Core inflation, which excludes accommodation and private road transport costs, remained unchanged from the previous month at 1.5 per cent, the Monetary Authority of Singapore (MAS) and the Ministry of Trade and Industry (MTI) said in a joint press release on Tuesday (Dec 26).

    Private road transport costs rose 4.1 per cent in November from a year earlier, data from the Singapore Department of Statistics showed.

    Accommodation costs fell by 3.9 per cent in November, moderating from the 4.2 per cent drop in the previous month. The smaller decline reflected the dissipation of the dampening effect of the disbursement of Service & Conservancy Charges (S&CC) rebates on the year-ago change in accommodation costs in October, the joint release said.

    Services inflation edged up to 1.6 per cent in November from 1.5 per cent in October. This was on account of a rise in airfares, which was a reversal from the decline registered in the previous month, as well as a larger increase in telecommunications services fees and holiday expenses which more than offset the smaller increase in recreational & cultural services fees.

    Food inflation was unchanged from the previous month at 1.5 per cent, as the pace of increase in prices for non-cooked food and food services was similar in both months.

    The overall cost of retail items registered a smaller 0.5 per cent increase in November compared to the 0.9 per cent increase in October. This largely reflected a fall in the prices of personal care products, as well as a smaller rise in the prices of personal effects, the joint release said.

    FUTURE OUTLOOK

    Looking ahead, the MAS expects core inflation to be around 1.5 per cent in 2017 and average between 1 and 2 per cent in 2018. MAS said in a media release that the CPI is projected to come in at around 0.5 per cent this year and stay in the range of between 0 and 1 per cent next year.

    However, Francis Tan, economist at UOB, said he does not expect major risks of a higher inflationary trend, but noted that all eyes could be on MAS’ next policy meeting in April.

    “The market expectation, and our expectation, is that the MAS, in their next policy meeting in April 2018, will start to normalise. I think that goes to show that among all the central banks in the world, they are more or less looking at or already started the monetary policy normalisation and the MAS is likely to continue to likewise,” said Mr Tan.

    “Of course we are not looking at a very steep increase in the S$NEER slope even at the start. We are only looking at a 0.5 per cent per annum at the start, but with more data coming in, the central bank will definitely tweak its policy appreciation stance.”

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  • E-commerce players feel the heat as bargain hunters call shots

    E-commerce players feel the heat as bargain hunters call shots

    Buyers have become more price sensitive and less loyal to the online platforms in a trend that has prompted an intense “pricing game”, the event heard. Consumers are switching over to the e-commerce operators that offer better promotions and prices.

    The seminar also heard that so-called social commerce (s-commerce) has become another competitor, under a model where sellers and buyers can make shopping transactions directly.

    Pawoot Pongvitayapanu, founder and managing director of Tarad.com, said the platform was launched about 10 years ago as the first e-marketplace in Thailand.

    “Today, we are adjusting the positioning of Tarad.com to cope with more intense competition in the e-marketplace model. Without the new positioning, we would not be able to compete against other marketplaces,” he said.

    Speaking at the e-marketplace forum held on Sunday at Thailand e-Commerce Week 2017, Pawoot said that nowadays competition in the e-marketplace has become more of a pricing game. Consumers have become more price sensitive and have less loyalty as they follow the bargains.

    “Today, the actual competitors in the e-marketplaces are not other e-marketplace players, but s-commerce operators, such as Facebook and Instagram, where sellers and buyers can make their own transactions directly,” said Pawoot.

    Thanida Suiwatana, chief financial officer – Thailand, Lazada Group, said that that Thai consumers have become more confident about online purchases.

    “We spent a lot of money in doing marketing campaigns. both offline and online, to generate traffic,” said Thanida, adding that Lazada is now a top 10 e-marketplace in Thailand in terms of traffic.

    “Having good traffic is one of the most important factors for both bricks and mortar stores and online marketplaces. Any online platforms that can generate good traffic will have more chances to sell products.”

    Nuttawit Pholwattanasuk, managing director and co-founder of LnwShop, said that the platform serves individual vendors, enabling them to have their own website and space. It is similar to the idea of a developer of a market or shophouse allowing individual merchants or retailers to do business within their own retail space.

    Eric Bui, head of operation, Shopee Thailand, said that online marketplaces now go beyond the transactional, with a focus on the engagement between buyers and sellers as part of an ongoing relationship.

    “The way we do our listings and provide services to the sellers, everything is free, with no commissions or listing fees,” he said. “The shipping fee has been subsidised by Shopee. There is no reason why the listings on Shopee should not be the cheapest in the country.”

    Haejin Pyun, general manager, marketing strategy, 11street Thailand, said the company started the Thai operation in February.

    “We consider sellers and buyers alike to be very important. While other e-commerce players care about the buyers only, we care about the sellers sometimes more than the buyers,” said Pyun.

    “In Thailand, more than 50 per cent of the transactions come cash on delivery. At 11street, more than 70 per cent of the transactions come from credit cards. We see a big potential to grow in the Thai e-commerce.

    “However, to grow the e-commerce business in Thailand, the payment method is very important. In South Korea, credit card penetration is more than 90 per cent, compared to only 10 per cent in Thailand. Even though they have credit cards, Thai shoppers are still hesitant to put their credit card numbers on an e-commerce site.”

    Thananan Arunragtichai, assistant director of Ascend Commerce, said that the company has operated the weloveshopping.com for 15 years as a store front. For its website, the e-marketplace model was introduced three to four years ago.

    “Today, Thai consumers have greater expectation for marketplace services, such as cheap prices and high quality, as well as good after-sales service. As an e-marketplace operator, we need to manage their expectations properly,” he said.

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  • Thailand Tobacco cries foul on excises

    Thailand Tobacco cries foul on excises

    The overhaul in the excises, implemented in September, had put Thailand Tobacco at disadvantage, as its tax burden had risen disproportionately to that of the foreign producers, Daonoi Suttiniphapunt, Tobacco Monopoly’s managing director, told a press conference yesterday.

    She said the company had to increase its product prices while the big importers had even lowered their prices on some lines.

    She urged the Finance Ministry, which oversees the Excise Development, to review its law enforcement in the sector.

    “The problem concerns two areas – the loophole in related regulations issued by Finance Ministry and the biased law enforcement under the Excise Development,” she said.

    The new taxing structure is based on the suggested retail price of a product, instead of the ex- factory or CIF prices for the local producer and the foreign brands, respectively, that applied previously.

    The rate is 20 per cent for a cigarette pack worth no more than Bt60 and 40 per cent for higher priced packs. They also have to pay Bt 1.20 per each cigarette stick.

    The Excise Department earlier sought to reassure the industry that the new tax system would be fairer for everyone. Moreover, if any company sold cigarettes at cheaper prices to the previous level, without good reason, they would be subject to scrutiny. The department could force them to accept the suggested retail prices, which would result in higher tax payments.

    Daonoi complained that while TTM had followed the rules strictly, some of the biggest brands had failed to do so. They had taken advantage of the loopholes in the system and the lack of law enforcement to ramp up the presence of their products in the Thai market, she said.

    Within a month of the new taxing structure going into force in September, the market share of the Thailand Tobacco had dropped sharply from 80 per cent to 65.9 per cent, she said. The share held by the foreign brands rose to 32.5 per cent, at the expense of Thailand Tobacco, she said.

    Daonoi warned that TTM had started to lose money and it could lead to transfers to government coffers drying up next year. The government may lose revenue of Bt 8 billion for that year, she said.

    The company contributed Bt8.8 billion to the government this year. It also paid Bt68.6 billion in excises.

    The projected reduction in contributions would have a knock-on effect in diminished support for causes such as the Thai Health Promotion Foundation, Thai PBS television and a fund for the elderly, Daonoi warned.

    Looking ahead, the future of the company is bleak as the tax rate will go up to 40 per cent in the next two years.

    “To introduce new products to the market is not easy due to the strict laws and consumers may not welcome them, so the TTM would find it very hard to play the pricing game,” Daonoi said.

    “If the Finance Ministry and Excise Department do not thing, the company will go bankrupt,” she added.

    TTM is a state enterprise under the Finance Ministry’s supervision.

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  • Luxury cosmetic brand Giorgio Armani Beauty to Join Tmall

    Luxury cosmetic brand Giorgio Armani Beauty to Join Tmall

    Giorgio Armani Beauty will launch a flagship store on Alibaba-owned B2C shopping platform Tmall next month as part of the brand’s latest campaign to capture China’s fast growing appetite for high-end beauty products, Alibaba said Monday.

    The luxury beauty and skin care brand, owned by the world leading cosmetic giant L’Oreal, will hold a series of pre-sale events on Tmall for the next three weeks ahead of its official launch on Jan 16. As part of the rev-up, the brand is offering 4,000 cases of its iconic “My Armani To Go” cushion foundation exclusively to be sold on the platform during the period.

    On the day of the launch, the brand will also open a store on the Luxury Pavilion, the invite-only section within the shopping site for premium and luxury brands. Brands including Burberry, Hugo Boss, La Mer, Maserati and Guerlain (LVMH) have joined since the platform was first introduced in August this year.

    China’s beauty product sector has seen a boom in recent years in tandem with the rapid development of the Chinese economy. According to China’s National Bureau of Statistics, retail sales of cosmetic items in the first 11 months of this year notched a 13.5% on-year growth, amounting to RMB $228.5 billion ($34.87 billion).

    Recognizing China’s fast-growing demand for high-quality cosmetic products and Tmall’s expansive reach with its 500 million active users, many top beauty names such as Lancome, La Mer, MAC, Bobbi Brown, Fresh and Kiehl’s have opened up shops on Tmall in recent years.

    In a recent interview with China Daily, Veronique Gautier, global president of Giorgio Armani Fragrances & Beauty, said Armani Beauty has seen stellar growth in China, at twice the speed of the rest of the markets combined.

    On Jan 12, several of the Giorgio Armani Beauty’s high-ranking executives will appear at an event in Beijing to announce the official launch of the flagship store on Tmall. The brand will also introduce a high-tech showcase of its 2018 spring-summer collection.

    As part of tie-up, the brand and Tmall will introduce interactive digital experiences for consumers to book offline make-up sessions with beauty advisors, explore its product offerings — from the latest Ecstasy Shine lipstick crafted specifically for the Asian market to its iconic fragrances and Lip Maestro lip gloss.

    Entertainment and gamification will also play a major role in attracting customers to Giorgio Armani Beauty’s new online store. By using their mobile phones, users can use the AR-powered interactive feature—Unlock Armani Codes—to scan anything that contains any of the six-letters in the word “Armani.” Those who have collected all six letters will have the chance to win sample kits priced at RMB 260 each.

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  • Sophisticated investors are staying away from Bitcoin

    Sophisticated investors are staying away from Bitcoin

    Malaysia’s pension fund managers are not putting money into bitcoin, despite the digital currency’s recent stratospheric rise.

    Armed Forces Fund Board or Lembaga Tabung Angkatan Tentera (LTAT) chief executive officer Tan Sri Lodin Wok Kamaruddin told NST Business that bitcoin is a highly speculative investment, where the value does not necessary reflect its fundamentals.

    “We don’t have any intention to invest in bitcoin at all. We would prefer to confine our investment within the country where we can, to some extent, control the risk and investment better,” he said in a telephone interview.

    He said the government statutory body would not take the risk in such kind of investment it has at its disposal.

    “Since Bank Negara Malaysia (BNM) deems it as illegal, we certainly would not want to have anything to do with it. I think it is something that the public should refrain from getting involved with their hard-earned money,” he added.

    Lodin said LTAT is currently managing about RM9 billion worth of armed forces retirement money.

    “We have got quite a fair distribution of our assets in different sectors, especially those which are in line with the government’s economic development programme such as infrastructure, property development, plantation and ship-building as well as retail operations like BH Petrol,” he said.

    Lodin said presently LTAT does not plan to invest abroad.

    “No doubt in some cases, investing abroad may be more attractive but at the same time the risk is higher such as currency and politics. At least, if it is within the country, we could mitigate these risks,” he said, adding that LTAT able to pay on the average of 11 per cent dividend annually to contributors.

    In a separate meeting with the Employees Provident Fund (EPF), its chief executive officer Datuk Shahril Ridza Ridzuan said cryptocurrencies such as bitcoin have no intrinsic value and donot provide any kind of actual asset yield. Therefore, it is very hard to invest in it.

    “Cryptocurrency is effectively buying something with the hope of selling it to someone else for a higher price,” he said.

    Shahril Ridza said the speculative element in the returns profile is too great for a fund like EPF, where it focuses on generating actual returns on assets.

    IQI Global chief economist Shan Saeed concurred, saying bitcoin has no sustainable value and none of the global central banks approved it.

    “Nobody has approved bitcoin as a mode of (payment) instrument. Although people are buying, the price is likely to crash. It is a fancy item with no fundamentals,” he said.

    Shan advised investors in Malaysia to stay away from Bitcoin, saying that the chances of losing money are fairly high.

    “Recently the United Kingdom regulators have warned investors to stay away from bitcoin. I’m not in favour of bitcoin because it is a virtual currency. It’s not even worth looking at,” he said.

    Shan said bitcoin is not secured without regulators’ approval, and it is a perfect example how the bubble could burst.

    “The incredible rise of bitcoin over the last few weeks has all the hallmarks of a major topping action when a speculative asset in the final euphoric stages of a big bubble formation makes some unsustainable huge price jumps,” he said.

    He said bitcoin should soon witness a final blow off with one last giant spike higher on huge volume followed by a major price reversal on the same day.

    The Retirement Fund Inc (KWAP) chief executive officer Datuk Wan Kamaruzaman Wan Ahmad recently said cryptocurrency is not the type of risk it can take.

    “We are not invested in cryptocurrency because we prefer to only take moderate risks. However, we do personally monitor the movement of the Bitcoin’s trends,” he said in a recent interview with BFM.

    He added that KWAP has always aimed for more stable investment, with slightly above a double-digit return to its shareholders.

    Last week, Bank Negara announced that Malaysia had recorded RM75 million transactions monthly from four digital currency exchanges in the country.

    Its deputy governor Abdul Rasheed Ghaffour said digital currency exchanges here providing the services were Luno, CoinHako, XBit Asia and PinkExchange.

    He said Bank Negara would meet cryptocurrency exchanges this week, noting that the global market capitalisation of digital currency stood at US$420 billion.

    He said while digital currencies were not legal tender in Malaysia, the central bank was not stopping their trading because “a ban would curb innovation and creativity.”

    In an AFP report quoting investment firm deVere Group chief executive officer Nigel Green, bitcoin started the year at US$1,000 per unit in January. By mid-December, it had shot to within striking distance of US$20,000, a dizzying climb that stoked fears of a bubble even in financial circles used to speculation and volatility.

    Bitcoin was created in 2009, since then, it has become the world’s decentralised cryptocurrency.

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  • Ford Partners With Alibaba to sell Cars In China

    Ford Partners With Alibaba to sell Cars In China

    Online retail giant Alibaba has signed a deal to sell Ford’s electric vehicles in China using gigantic vending machines. Shoppers scan the vehicle they’re interested in  purchasing, using Alibaba’s Taobao app. They then pick a color and other customized options. Next, they snap a selfie that is used to match them with their order. The system then arranges for a test drive of the car, using facial recognition as a way to unlock access to the vending machine.

    The multi-floor vending machine rotates the cars in stock until the one the customer selected is found.  Alibaba customers pay a deposit and are given three days to test the vehicle to determine whether they want to purchase it. Once they decide, they can use the smartphone app to pay for the car or to return it and arrange another test drive.

    Customers are limited to five test periods every two months. They also must qualify as Alibaba Super Members, and have reached a certain level on the company’s credit scoring service.

    Alibaba plans to open two facilities in January 2018 in Shanghai and Nanjing, followed by dozens more across China next year if the concept proves a success.

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  • Apple cuts iPhone X margins for Indian retailers

    Apple cuts iPhone X margins for Indian retailers

    Stores in India which sell the iPhone X have complained about the reduction in retail margins by Apple from 6.5% to 4.5%. Large chains and even small-scale operators are accusing the company of wanting to scoop in massive margins while not allowing its retail partners to benefit.

    Some stores, like the Bengaluru-based Sangeetha Mobiles, had stopped taking orders for the iPhone X. This comes as a supply-demand mismatch in India has led to calls for Apple to give the country a higher priority when it comes to providing stock in time. iPhone production has fallen to the extent that it has affected the bottom line of companies like Foxconn which assemble the devices.

    Subhash Chandra, managing director at Sangeetha Mobiles, says: “Apple has cut margins on the iPhone X from 6.5% to 4.5% for large retailers like us, and if a customer pays by card, which is usually the case, the margin reduces to almost 1.5-2%.”

    Sangeetha Mobiles has about 400 stores across India. “Apple gives the least margins… How on earth do they expect the retailer to work for them for free — our overheads are anywhere around 10%,” complained Chandra.

    The margins offered by brands like Samsung and Xiaomi are more than double what Apple does – 12% to 15%. Brands like Oppo and Vivo are giving higher than usual margins in order to compete better in the burgeoning Indian market.

    Quoting an unnamed chief executive of a top retail chain as saying that he would not be stocking the iPhone X at its 300-odd stores due to the reduced margins and because he had no control on retail pricing both offline and online.

    Underling the supply issues, another big handset retailer said he had received only 400 iPhone X units since the launch, much less than what had been promised by Apple.

    Analysts told the newspaper that if Apple did not step up supplies, it may be unable to bridge the gap with Samsung and the numerous Chinese brands that were already ahead in terms of volume sales.

    India has about 350 million smartphone users, a number that is expected to grow to 500 million in the next couple of years. Many new buyers or those looking to upgrade are potential iPhone users.

    One analyst, Neil Shah, the research director at Hong Kong-based Counterpoint Research, told the newspaper: “They (Apple) will have to start now because if they lose a window of opportunity in next two years to be on mind of the growing smartphone user base, it would be somewhat difficult to grow faster in the world’s second largest smartphone market.”

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  • Asia’s Most Overworked Country Pushes For Right To Rest

    Asia’s Most Overworked Country Pushes For Right To Rest

    President Moon Jae-in’s drive to give South Koreans their “right to rest” by slashing work hours is making little headway as lawmakers haggle over pay rates for weekends.

    While the long hours were once considered necessary to fuel rapid economic growth, the grind is now seen as the source of the country’s social problems, including low birth rate and productivity. South Koreans work 2,069 hours a year, the second-most among Organisation for Economic Co-operation and Development members after Mexico.

    With the changing societal attitude toward work, Korea’s ruling and opposition party lawmakers reached a tentative agreement in November to cap weekly hours at 52, down from 68, and give an extra 50 percent in pay for weekends. Moon, who pledged to cut hours during his presidential campaign last spring, said the change “is a task that should not be delayed any more.”

    But the agreement failed to reach the plenary session as some lawmakers and labor unions argued for doubling the extra pay for weekend work to 100%. The Korean Confederation of Trade Unions said in a statement that doubling pay for weekend work is necessary to reduce working on weekends, and an appropriate level of compensation for those who must do so.

    If lawmakers fail to revise the labor law by Dec. 23, which seems likely, parliament may not be able to pick it up again until February at the earliest. A prolonged debate could put Moon’s “right to rest” initiative on a permanent holding pattern as was seen with much of former President Park Geun-hye’s legislative agenda.

    Improve Productivity

    As lawmakers argue over weekend wages, some employers say that while they agree with the need to shorten working hours, the changes should be more gradual. Kim Young-vae, vice chairman of the Korea Employers Federation, said at a forum on Dec. 14 that the change should first be applied to bigger companies with more than 1,000 employees, and that a 60-hour cap should be allowed at companies that have reached agreement with their employees.

    “Shorter working hours are necessary for the sake of happiness, but it needs to be discussed along with ways to improve labor productivity,” said Kim Tai-gi, a professor of economics at Dankook University in Jukjeon, South Korea. “Without better productivity, it would have side effects like a decline in income for workers and an increased cost burden for employers.”

    Labor productivity, as measured by total working hours and per capita GDP, was $33 per hour for Korea in 2016, compared with $24 for Chile, $41.5 for Japan, $60 for France, and $63 for the U.S., according to OECD data.

    Not all workers welcome the move toward fewer hours.

    Shinsegae Group, South Korea’s retail giant, has announced it will reduce regular weekday working hours to 35 per week from 40 with no cut in wages from 2018. But some labor unions for Shinsegae’s discount store unit, E-mart, say it will only increase the burden on workers because they will be required to complete the same workload in fewer hours. They said that by 2020, the employees could also be paid less than others who are working longer hours and receiving the minimum 10,000 won per hour promised by President Moon during the campaign.

  • Going cashless no small change

    Going cashless no small change

    After years of creeping at a snail’s pace, the e-payment scene has roared to life, setting 2018 up to be the year that cashless payments could finally become ubiquitous. Once Prime Minister Lee Hsien Loong made a call for a unified e-payment system at the National Day Rally in August, there were many developments, culminating in two significant moves in November.

    The first was an announcement from Education Minister (Higher Education and Skills) Ong Ye Kung, who is a board member of the Monetary Authority of Singapore, to expand the use of PayNow, an instant fund-transfer service, to businesses mid-next year.

    Launched on July 10, PayNow lets individuals transfer money by entering the recipient’s mobile phone or identity card number in any bank’s app. As at last month, more than 600,000 Singaporeans have linked either their mobile numbers or identity card numbers to their bank accounts via PayNow.

    By mid-next year when companies are allowed to link their business registration numbers to their bank accounts, PayNow’s use will be more pervasive, going beyond transfers between friends.

    With PayNow, merchants need not worry about complex system installation and related fees. As PayNow rides on Fast (Fast and Secure Transfers) – the country’s instant interbank funds transfer system – merchants also need not worry about cash-flow issues. Comparatively, credit card and ATM card direct debit transactions take up to two days to settle.

    While PayNow may be useful for owners of pop-up stores, its use at hawker centres may be limited. It is unthinkable that anyone would want to enter a business registration number and the amount owed into a bank app just to pay for a plate of chicken rice.

    Enter a national quick response code payment standard, dubbed SGQR. The release of its specification last month marks the second major breakthrough this year. Its aim is to allow merchants to display just one QR code for scanning by any e-wallet for fuss-free transfers.

    Singtel’s Dash is the first to embrace SGQR, with its QR code sticker displayed at a handful of merchants here.

    E-payment stalwart Nets also said it will change its QR code – rolled out to about 30,000 acceptance points in malls and taxis, and 600 hawker stalls – to one that incorporates the SGQR specification.

    • Since Prime Minister Lee Hsien Loong made a call for a unified e-payment system during his National Day Rally in August, there have been many developments – including two significant moves in November:

      1 Expanding the use of PayNow, an instant fund-transfer service, to businesses mid-next year . Launched on July 10, PayNow lets individuals transfer money by entering the recipient’s mobile phone or identity card number in any bank’s app.

      2 Release of a national quick response code payment standard – dubbed SGQR – specification, whose aim is to allow merchants to display just one QR code for scanning by any e-wallet for fuss-free fund transfers.

    Nets’ QR code system now works with the e-wallets of DBS Bank, OCBC Bank and United Overseas Bank. Next year, customers of Citibank, HSBC, Maybank and Standard Chartered Bank will also be able to scan the Nets QR code to make payments.

    Together, these seven major banks cover about 90 per cent of all retail transactions in Singapore.

    The nation’s effort to unify its e-payment systems may take more than a standardised QR code or enlisting businesses in the peer-to-peer PayNow scheme.

    Payment providers may also need to standardise the way they itemise and describe bills, and how fast they settle payments, to help merchants and hawkers with account reconciliation at the end of the business day.

  • Stop DDoS from ruining your retail Brand’s sales momentum

    Stop DDoS from ruining your retail Brand’s sales momentum

    On 11 November 2017, Alibaba’s Singles’ Day sales hit a new record high with a 39% increase from last year’s sales. The company’s 2017 profits broke world records of Black Friday and Cyber Monday, marking this Asian sales day as one of the highest revenue sales in history.

    With increasing internet-user penetration, consumer behavior is quickly transitioning in Asia today. Shoppers make most of their retail purchases on-the-go, through mobile applications or via websites. In fact, 90% of this year’s Alibaba sales were made through mobile phones.

    Now more than ever, retail businesses in the Asia-Pacific region need to tap onto an omni-channel approach to be aligned with these changing customer demands. Based on the 2016 e-commerce study, Google and Temasek foresee Southeast Asia to be the next region to boom in this market. The predictions indicated that e-commerce will make up 6% of the region’s total retail sales by 2025.

    Beware of business bullies

    While these statistics show a positive growth for the region, businesses going digital must be aware of the lurking threat factors. The physical shoplifters that pained businesses – especially during big sales such as Great Singapore Sale and Black Friday – have now evolved to become cyber criminals. Unlike thieves, businesses are not physically able to discern these criminals, especially since they attack over the network.

    One of the most devastating kinds of cyberattack for e-commerce businesses today is Distributed Denial of Service (DDoS) which aims to bring down websites, therefore, disrupting online services and businesses. DDoS attacks occur when an unusual and unexpected spike in traffic and connection requests overwhelms a website, slows down the network, or in the worst-case scenario, shuts down the entire system.

    A reliable website that guarantees a good user experience is what defines a successful e-commerce business as it is the main platform for acquiring customers and generating revenues. The damage caused by a network failure or a complete site outage will directly and immediately impact business assets. For instance, Alibaba made US$7 billion within the first 30 minutes of the Singles’ Day sale3. Imagine if they had been hit by a DDoS attack; Alibaba would have lost US$233 million per second. Not only would this be a massive loss, the attack would have also caused long term damage to Alibaba’s brand image and customer loyalty. According to KPMG’s annual consumer survey, one fifth of consumers will turn away from a cyber-attacked company4.

    Don’t fall victim

    With the festive period approaching, online retailers can expect an approximately 20% increase in their web traffic5. To make the most out of this sale period, businesses need to ensure that they are ready to protect themselves against DDoS attacks. This includes re-evaluating their network security to assure they are taking the best protective measures.

    Monitor and Detect

    Businesses cannot fight what they do not know. Monitoring network traffic and flow data with DDoS detection alerts security pros to anomalies before they become full-blown catastrophes.

    One way to get a better understanding of what is happening on the network is baselining to know what the traffic looks like during peacetime. This allows organizations to take the appropriate wartime countermeasures when an attack happens. Effective DDoS detection needs to be able to discern the human traffic from the bots.

    Additionally, organizations need a detection solution that can scale given that attacks are increasingly getting larger in size. The best class solution should not only be able to process the data, but also be equipped with the ability to quickly make intelligent decisions with that data.

    Mitigate and Protect

    DDoS protection requires having the right mitigation in place. Businesses should look for a modern DDoS solution that empowers them to automate defenses – from reports to packet captures to mitigation. This can help security pros reduce stress and thwart attacks quickly.

    Communicate

    As with all security procedures, effective DDoS defense involves a human element, as well. It is imperative for businesses to have a communication plan in place in the event of an attack. This includes critical information such as who to notify during, and after an attack. For example, who should be the first to know if the site goes down due to a DDoS attack? Is that the same person notified if a DDoS attack shuts down the online retail site? Who else is notified if an attack happens? Having communications ironed out ahead of time can reduce time to remediation and lower stress levels.

    Make the most of this year’s sale season

    For businesses, these next few months are the time to peak your revenue and customer traffic. It may be a chance to raise brand awareness or even expand the business. Whichever the case, a DDoS attack can be a fatal roadblock to an organization’s goals. Reacting in an efficient manner is key. Online retailers need to ensure they have an emergency response plan that makes good use of anti-DDoS technologies for unforeseeable attacks. For a happy holiday for all, be on the lookout for any dangers and take the right cautionary actions to protect against any potential threats.

     

  • Kinpo to add 2 factories in Philippines

    Kinpo to add 2 factories in Philippines

    Consumer electronics maker Kinpo Electronics, viewing that production capacities for smart home appliances at two factories in the Philippines will be fully utilized in first-half 2018, will set up two more factories there in third-quarter 2018, with one for injection molding and the other for assembly, according to company president Simon Shen.

    The existing factories and the ones to be built in the Philippines belong to Kinpo Electronics (Philippines) in which Kinpo and its Thailand-based affiliate Cal-Comp Electronics hold a 81% and 19% stake respectively, Shen said, adding the Philippines-based subsidiary is expected to be listed on the local stock market in third-quarter 2018.

    Kinpo stepped into production of consumer 3D printers in 2017 and currently has a global market share of 23-24% Shen said, adding it will extend production to business-use 3D printers in 2018.

    Kinpo expects to globally ship 73,000 3D printers, including 500 for color printing, in 2017, and 100,000 units in 2018, consisting of 2,500-3,000 color models, Shen noted. A color 3D printer sells for US$35,000.

    Kinpo has also begun production of service robots for hospitals, hotels, retail stores and airports, with unit prices ranging from US$15,000-30,000, and 2018 target shipments are set at 300-500 units, Shen indicated.

    Kinpo expects to ship 10,000 units of HiMirror, a smart device for medical care of facial skin, in 2017 and will offer a second-generation model with target shipments of 50,000-100,000 units in 2018.

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  • PTT plans to double retail fuel margins

    PTT plans to double retail fuel margins

    PTT, the national oil and gas conglomerate, plans to double profit margin from fuel retailing business to 30% of total sales by 2022, says Auttapol Rerkpiboon, chief of operations for downstream petroleum business.

    To achieve the goal, the company has set aside a capital spending budget next year of 12.17 billion baht, with another 10 billion for each year until 2022 to expand its oil and non-oil businesses.

    Mr Auttapol said the executive board approved the increased spending last week.

    The board also gave the go-ahead to an increase in the number of petrol stations to 1,800 nationwide next year and to 2,560 by 2022. The company has 1,400 petrol stations now.

    “Competition in the retail fuel business should be fierce,” Mr Auttapol said.

    PTT hopes the spending plan will allow it to maintain its position as the top fuel retailer with a 41% market share.

    The company plans to focus on diesel consumers next year by adding two new diesel stations for trucks.

    Diesel consumers are expected to drop over the next several years because of rival projects from competitors, Mr Auttapol said.

    The focus on petrol should help offset a dip in gas sales, Mr Auttapol said. Natural gas demand is expected to drop substantially after the removal of universal government subsidies this year, making prices uncompetitive against other fuels.

    The capital spending plan calls for PTT to expand the number of Amazon Coffee Shops to 2,300 next year, up from 2,000. The shop total is expected to rise to 4,000 in 2022, Mr Auttapol said.

    Another expansion on the non-oil front will be new food and drink retailers at PTT petrol stations. Next year, PTT expects to have an additional four food franchise brands at its stations.

    Mr Auttapol said PTT is about to finalise a plan to develop budget hotels adjacent to its fuelling stations and could announce a partner for the project soon.

    He said PTT plans to expand its petrol station network in other Asean countries from 225 stations to 295 next year and to 600 by 2022.

    For lubricants, PTT also plans to increase the sale of lube products next year, particularly in overseas markets such as China, where demand for lube remains high.

    PTT expects sales of lube product in China to rise to 400 million litres by 2022, up from roughly 200 million litres this year.

    Mr Auttapol said PTT expects fuel demand next year to grow by 2-3%, which is close to growth seen this year, an assumption based on domestic economic growth of 3-4%.

    The company’s PTT Oil and Retail Co is expected to be fully spun off in 2018, he said.

    PTT Oil and Retail Co aims for a listing on the Stock Exchange of Thailand in 2019.

    PTT shares closed yesterday on the SET at 448 baht, up two baht, in heavy trade worth 1.96 billion baht.

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  • Il Bisonte plans to open shops in Asia

    Il Bisonte plans to open shops in Asia

    Italian leather goods label Il Bisonte, owned by UK investment fund Palamon since 2015, plans to open a directly owned shop in Hong Kong as a way into China.

    Founded by Wanny Di Filippo in 1970, the company expects to close this year with revenue exceeding €27 million (US$32 million), says CEO Sofia Ciucchi, who was appointed in January. This would be up 27 per cent on last year’s revenue.

    As well as eyeing Asia, the brand has growth plans closer to home. It will open an 800sqm showroom next month on the top floor of Florence’s historic Palazzo Corsini, with a launch event celebrating the fact that Il Bisonte’s entire output is produced with a 30km radius of the city. The showroom will also house the company’s offices, while manufacturing and product development remain in Pontassieve.

    At the end of next month Il Bisonte will open a six-month pop-up store in Rue St Honore, Paris, and its two permanent Parisian stores will be later renovated.

    Overseas plans include a possible second store in London and an opening in the US, most likely New York.

    Another main focus for the label is e-commerce, to which end it will expand its manufacturing and logistics infrastructure next year, building a 2000sqm warehouse in Pontassieve.

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  • Chateraise plans to open 200 shops in Thailand

    Chateraise plans to open 200 shops in Thailand

    Japanese patisserie Chateraise, which is known for having its main factory in the middle of a forest, plans to open 200 shops in Thailand and boost overseas sales to 50 per cent of its total revenue in the next 10 years.

    With more than 500 outlets mainly in Japan, it has just opened its second shop in Bangkok, at Gateway Ekamai Shopping Mall, and is seeking franchisees to accelerate store expansion in Southeast Asia’s second-largest economy.

    Its debut shop for Thailand opened in Isetan Bangkok department store in July. Both Bangkok outlets are under franchise.

    In the past two years, Chateraise has moved into eight markets across Asia, opening more than 30 shops. The company sees Thailand as a promising market where sweets consumption is expected to be driven by economic growth coupled with a youthful population, says senior managing director Takako Saito of parent company Chateraise Holdings.

    Based in Yamanashi prefecture, the company produces cakes, pastry, confectionery and beverages at six factories across Japan. It procures raw materials directly from contracted farmers and sells through branded shops.

    Almost all products for Thailand are shipped from Japan, with plans to add ice cream to the lineup. Chateraise plans a third Bangkok shop for next year

    The brand’s first overseas expansion was to Singapore in 2015, and it has since opened stores in Dubai, Hong Kong, Indonesia, Malaysia, South Korea and Taiwan, and plans to head to Hanoi and Manila next year.

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  • Korea’s Twosome Place, Ediya coffee chains planning an IPO

    Korea’s Twosome Place, Ediya coffee chains planning an IPO

    Two South Korean coffee franchises are pushing ahead with IPOs to raise funds for expansion both domestically and globally.

    A Twosome Place and Ediya Coffee are seeking to challenge Starbucks Coffee, which dominates the Korean market. It says Ediya aims to be listed by the end of next year, which would be a first for a coffee shop franchise.

    Ediya would probably use the new capital to build a roasting factory and to expand overseas. The company ranks third in Korea in terms of sales and first in store numbers. With 2200 stores, it has posted KW150 billion (US$139.5 million) in sales, following Starbucks (more than KW1 trillion) and Twosome (KW200 billion).

    Meanwhile, Twosome plans to separate from CJ Foodville to become a subsidiary in February. It is also expected to list on the Seoul bourse to raise more funds.

    Korea already has more than 90,000 coffee shops, but is still attracting global chains. US Blue Bottle Coffee has established a local subsidiary and expects to open its first Seoul store in March.

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