Retail News CRM

Author: Mei Ling Tan

  • Apple, Nike and Playboy among most popular US brands on Alibaba’s Singles Day

    Apple, Nike and Playboy among most popular US brands on Alibaba’s Singles Day

    Alibaba Group Holding Ltd. says sales from its massive Singles Day shopping event totaled $17.8 billion, up more than 24% from the record $14.3 billion sold last year.

    (This year’s total is RMB 120.7 billion, up 32% year-over-year due to fluctuations in the Chinese currency.)

    The most popular U.S. brands as of about 10:30 p.m. CST were, in order: Apple Inc. Nike Inc. New Balance, Playboy, and Skechers USA Inc.

    “Alibaba is using this year’s Singles Day to showcase the number of international brands participating, everyone from Apple, Victoria’s Secret, Burberry, Gap, [and] Nike, acting as the gateway to China for these brands and fulfilling Chinese consumers’ insatiable demand for Western products,” said Danielle Bailey, head of Asia-Pacific research for L2 Inc.

    Victoria’s Secret is in the L Brands Inc.  portfolio.

    Singles Day started strong, with sales of $1 billion recorded in the first five minutes.

    Alibaba Offers Virtual-Reality Shopping on Singles’ Day

    Alibaba is hoping to boost sales from China’s biggest annual online-shopping event–Singles’ Day–with what it claims is the world’s first virtual-reality shopping experience.

    Many U.S. brands have tried and, so far, failed to find success in the Chinese market. Recently, Netflix Inc. said it would abandon efforts to launch a full-service offering in China.

    Wal-Mart Stores Inc.  announced in June that it would partner with Alibaba rival JD.Com Inc. to grow its China business. The partners announced new initiatives in October.

    Apple and Nike are popular in China irrespective of the day, with Nike reporting 21% revenue growth in China in fiscal first-quarter 2017. The U.S. and China are Nike’s two biggest basketball markets, Trevor Edwards, Nike brand president, said on the Sept. 27 earnings call, according to a FactSet transcript.

    The Playboy brand is also popular in China, with items like jewelry and fragrances selling well.

    Starbucks Corp. seized the opportunity to get into the Singles Day festivities, offering a Cocoa Java Mocha beverage exclusively for the day at locations across China. The company also sold gift sets, exclusively-designed gift cards, and limited-edition My Starbucks Rewards Cards 11/11.

    Forty-seven million users purchased international brands, led by U.S. brands, according to L2 data, and 82% of sales were made on a mobile device.

    “With Alibaba distributing different deals across different devices, they have encouraged devoted savings seekers to keep separate shopping carts on their desktops and mobile phones,” said Tim Barrett, retail analyst at Euromonitor International. “Alibaba is grooming a generation of mobile-first shoppers, a move which will pay off greatly when the entire world is addicted to their mobile devices.”

    For Alibaba Chief Executive Daniel Zhang, this integration of sales across different platforms is critical.

    “If you look at this as an online game, people see you will have less margin in the future,” Zhang said, according to the Alibaba live blog of the Singles Day event. “But when we look at the entire landscape, only 10% of China’s total retail is online. What we believe is that at the end of this, online and offline… should be fully integrated.”

    This year, Alibaba introduced virtual reality into the 11.11 experience, as well as games, with 2.6 billion games played, according to L2.

    “Alibaba is blurring the lines between entertainment and e-commerce and extending technologies thought to be simply gimmicks in the West,” said Bailey.

    Even with the eye-popping sales numbers, popular brands and new technologies, Alibaba shares are down 1.4% in Friday trading.

    “In keeping with the de-emphasis of GMV [gross merchandise value] as a reported metric, we expect sales volume to become but one of many focuses of the event, with others being new mobile functionality, innovations and improvements in logistics, new partnerships,” said Deutsche Bank in a note published Tuesday, which calls Singles Day “a PR exercise.” Analysts there expected 35% year-over-year growth.

    Deutsche Bank rates Alibaba shares buy with a $138 price target.

    Alibaba shares are up 14.4% for the year so far while the S&P 500 is up 5.7% for the same period.

  • #Double11 2016 Singles Day Record Proves China’s E-Commerce Might

    #Double11 2016 Singles Day Record Proves China’s E-Commerce Might

    Chinese e-commerce giant Alibaba Group has tallied more than US$1 billion in the first five minutes and US$5 billion in transactions in the first hour of its annual Singles Day sales blitz. That means China’s 2016 Singles Day shopping fest—aka Shuangshiyi or Double Eleven, since it takes place each November 11—retains its title as the world’s biggest online shopping event.

    The final sales tally for the 24 hour global shopping spree: US$17.8 billion in GMV (gross merchandise volume) sales, or in China’s yuan or renminbi currency, RMB 120.7 billion. The vast majority (82%) of that shopping frenzy took place on mobile phones and devices, with $14.6 billion (RMB 98.97 billion) on mobile.

    Last year, Alibaba’s digital shopping platforms racked up a total US$14.3 billion in sales, bypassing the $9.3 billion in #Double11 Singles Day sales in 2014 — meaning the 24-hour shopping spree has almost doubled in two years.

    It’s also a proof point for Ant Financial Services Group, Alibaba’s fintech arm that operates its Alipay mobile payments platform. “The excitement around online shopping continues to build year after year, and it’s emblematic of the way that e-commerce is changing, giving consumers incredible access to products around the world,” said Ant Financial SVP Douglas Feagin to the South China Morning Post.

    Ant Financial this year says it processed 1.05 billion transactions, an increase of 48 per cent from last year. At the peak of the madcap shopping within the first hour, as many as 120,000 transactions per second were processed, Feagin said. Ant brought innovation and speed to the online sales crush. Just as importantly, it helped finance merchants and consumers alike.

    As SCMP reports, “Before the start of the so-called Singles’ Day shopping gala on November 11, Ant Financial’s MYbank unit granted over 50 billion yuan of loans to 1.33 million merchants to help them put their products online.Ant Financial’s Ant Credit Pay was also on hand to grant more than 100 million customers credit to finance their online shopping, Feagin said.”

    At the half-way mark, it was clear that 2016’s event would surpass last year’s record, according to Alizila’s coverage:

    At the 12 hour, 29 minute mark of the sale, total GMV had exceeded RMB 82.4 billion ($12 billion), with mobile accounting for 83.55 percent of the total.  Alibaba Group President Michael Evans had this to say: “With roughly 11 hours to go, we’re in a good place.” More than 14,000 international brands are participating in the sale, he said, and sales from international brands have so far accounted for about 30 percent of total GMV.

    Alibaba #Double11 Singles Day sale

    Virtual reality also played a role this year, with Tmall’s Buy+ billed as the world’s first virtual reality shopping experience. For the price of a 15 cent cardboard VR headset, shoppers could slip their smartphone into the headset and browse products from handbags to shoes to lingerie, and even have virtual models showcase the apparel and accessories on a catwalk.

    Shoppers could browse eight digital stores using VR to assess the goods before buying them. Participating retailers include Macy’s, Target, Costco, P&G, Chemist Warehouse, Freedom Foods, Tokyo Otaku Mode and Matsumoto, part of the over 11,000 international brands that join in the fair.

    The global online shopping event also introduced interactive games and partnerships with over one million brick-and-mortar shops, including a Pokemon Go-like mobile application to catch the Tmall cat mascot in offline locations of Tmall merchants in shopping malls to spur foot traffic to the merchants. In return, consumers can earn special prizes such as free subscriptions to Alibaba’s Youku TV.

    It also teased this year’s 11.11 with teasers including an eight-hour live-streamed “see now buy now” fashion show from Shanghai, where consumers can order anything they see on the catwalk in real time from brands including Victoria’s Secret.

    The goal of this technology is to “improve [the] consumer retail experience, I would say you’re looking at the future of retail. The future of retail is in China, not anywhere else,” Alibaba Group’s co-founder and vice chairman Joseph Tsai told a media briefing on Thursday in Shenzhen, China.

    Leading the 11.11 international sales brigade this year were merchants from the US, Japan, South Korea, Australia and Germany. Most countries have already exceeded the volume of sales recorded for the entire sale last year.

    It’s another astonishing Singles Day,  an annual promotion inviting consumers who are not in relationships to cheer up with some retail therapy — an anti-Valentine’s Day “treat yourself” event invented by Alibaba’s Tmall head, Daniel Zhang, in 2009 to rival America’s Black Friday and Cyber Monday shopping events, and now surpasses both of them combined.

    While 11.11 started with discounts, it has morphed into an event featuring global brands such as Apple and luxury brands such as Burberry and Maserati, which both operate branded Tmall stores.

    As Teng Bingsheng, Associate Professor of Strategy at the Cheung Kong Graduate School of Business (CKGSB) in Beijing, stated in a pre-event press release, “To some extent, people remember that Alibaba initiated the 11.11 shopping festival. However, other brands are quickly gaining their fair share as well. But as long as the whole pie – and Alibaba’s own business – both get bigger, it’s still good news.”

    CKGSB Associate Professor of Accounting Zhang Weining added, “Double Eleven used to last for 24 hours, but this year it will stretch for 24 days. I think Alibaba foresaw that the sales growth rate would slow down this year, in part because more and more e-commerce platforms are running these campaigns and consumers are increasingly attracted to promotions offered prior to the day itself. This new strategy will also ease the pressure on delivery logistics, since sales will be more spread out.”

    Jack Ma Kobe Bryant Alibaba Singles Day 11.11Chairman Jack Ma—who welcomed David and Victoria Beckham and Kobe Bryant (while Katy Perry dropped out for a family emergency) as ambassadors for this year’s event at its countdown gala—said Alibaba’s cloud computing system is “[by] far the most advanced that human beings can realize.”

    Last year, the company processed 140,000 transactions per second via its cloud arm Aliyun during the shopping peak, while payment arm Alipay processed an additional 86,000 transactions per second at peak sale time.

     

    The company reportedly plans to list in 2017 in either Shanghai or Hong Kong, making it China’s largest IPO since 2010 when the state-owned Agriculture Bank of China offered $22.1 billion worth of shares.

    Brand partners were also vocal about what propelled Single’s Day sales this year: mobile (as Gap attested), personalization (such as Oreo) and virtual reality:

    For its part, Walmart kicked off its Black Friday sales event today, along with Target, in a bid to attract shoppers in the mood for deals. Both retailers’ official in-store Black Friday sales begin at 6 p.m. on Thanksgiving, reprising last year’s schedule despite murmurings that consumer interest in deal blitzing on Turkey-day may be waning.

    While Office Depot and Mall of America announced they’ll be closed on Thanksgiving, Macy’s, Kohl’s and Toys R Us are joining Walmart and Target. Walmart will be “dramatically increasing” inventory to offer nearly 50 percent more Black Friday merchandise this year online than last year.

    Walmart US CMO Steve Bratspies said that “We really pride ourselves on not being the retailer who advertises a great price but then only has a few available for the customers.”

    Walmart deals include a Samsung 50-inch 4K television for $398 and movies that cost $1.99. Target is touting deals like an iPad Air 2 for $274 and 30 percent off apparel and the giant teddy bear for $10 that hijacked social media last year is back with 20 percent more bears!

    Both big-boxers will start with offers over the next two weeks seeding the way for customer engagement as holiday spirit.

    Target returns to its “10 days of deals” program, touting a single big promotion daily starting the weekend before Thanksgiving, while Walmart is offering limited-time Black Friday discounts and holding further price cuts for into December.

    Still, some rang a cautionary note about Alibaba’s sales reporting, as the BBC reported: “Some have questioned the accuracy of the numbers, amid claims of inflated sales data at online retailers across China. Merchants passing off counterfeit goods as genuine is also an industry problem. Alibaba reported 85% of purchases had been made on mobile phones during Singles Day.”

  • Neo Group’s 1H net profit soared 65.7% to $0.4m

    Neo Group’s 1H net profit soared 65.7% to $0.4m

    Singapore’s food catering group, Neo Group announced that its revenue for the six-month period ended 30 September 2016 (1H2017) grew 29.6% to S$67.4 million from S$52.0 million in the equivalent period last year.

    Improved performance across most business segments and a S$7.7 million revenue contribution from the Food Trading business segment lifted the integrated catering solutions provider’s 1H2017 topline performance.

    Food Retail grew 11.7% to S$9.8 million in 1H2017 from S$8.8 million on an increase in number of stores and effective promotions launched during the period under review.
    Similarly, Food Manufacturing reported a 45.9% growth in revenue of S$21.9 million compared to S$15.0 million across the comparative periods.

    Impacted mostly by seasonality due to the lack of festivities and in the absence of SG50 celebrations that lifted catering volumes last year, the Food Catering segment
    slid marginally by 1.2% to S$27.3 million in 1H2017 from S$27.6 million in 1H2016.

    In tandem with the stronger topline performance, coupled with other income earned of S$3.0 million, consisting mainly of a S$1.8 million one-time gain on disposal of a noncore
    property, Neo Group reported 1H2017 net profit attributable to owners of the parent (net profit) of S$0.4 million, a 65.7% rise from S$0.3 million in 1H2016.

    For the three-month financial period ended 30 September 2016 (2Q2017), Neo Group reported a 40 times increase in net profit of S$2.9 million compared to S$0.07 million a year ago (2Q2016) on a 13.4% rise in revenue to S$35.5 million from S$31.3 million across the same comparative periods.

    Removing the impact of the one-time gain on disposal, which amounted to S$1.8 million in 2Q2017, the Group reported an operational profit of S$1.1 million, turning
    around from an operational loss recorded in the preceding quarter.

     

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  • Mobile money halves overseas remittance costs

    Mobile money halves overseas remittance costs

    The average cost of sending international remittances with mobile money is less than half that of using global money transfer operators (MTOs), a new GSMA report reveals.

    Such lower prices contribute directly toward achieving targets within United Nations sustainable development goal (SDG) 102. Lower transaction fees also translate directly into additional income for remittance recipients.

    “Through mobile money services, the industry is directly supporting the goal of expanded financial inclusion for migrants and their families by reducing international remittance costs,” GSMA Chief Regulatory Officet John Giusti said. “The potential gains of achieving this target could be as high as $20 billion in additional income for remittance recipients.”

    The report noted that if people were able to send remittances from a mobile money account, the average cost of sending $200 was 2.7%, compared to 6% when using global MTOs.

    GSMA estimates that there are more than 400 million registered consumer accounts for mobile money across over 90 countries.

    “While today mobile money services are largely used for domestic transactions, international transfers represent the fastest-growing segment of mobile money services. In just a few years’ time, mobile money has moved from a purely domestic service to one that allows migrants to send remittances between more than 20 countries globally,” Giusti explained.

    World Bank data shows that more than 250 million people live outside their country of birth and regularly send money home, providing a financial lifeline to their families and contributing to the economies of their home countries.

    In 2015, global remittances totalled $581.6 billion, of which $431.6 billion, or nearly 75%, was sent to the developing world. However, the cost of international transfers remains high and directly impacts the income of remittance recipients.

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  • Citibank Indonesia reaps high profit growth in Q3

    Citibank Indonesia reaps high profit growth in Q3

    The Indonesian branch of US-based Citibank saw its net profits rise in the third quarter of this year despite the ongoing global economic downturn and sluggish domestic demand.

    The bank’s net profits surged by 64 percent year-on-year (yoy) to Rp 1.9 trillion (US$142.32 million) during the January-to-September period, according to a statement issued on Sunday.

    The profit growth was mainly driven by a 15.5 percent yoy increase in net interest income to Rp 3.05 trillion, along with a 2.79 percent yoy hike to Rp 1.51 trillion in its fee based income.

    “These results reflect the strong momentum of our business, both in institutional banking and consumer banking,” said Citibank Indonesia CEO Batara Sianturi in the statement.

    The bank introduced some initiatives for its institutional and consumer banking businesses in the third quarter, namely Citi Virtual Card Accounts (VCA) for treasury and trade solutions, Citi Priority for wealth management as well as Citi Indonesia Facebook to support the digitization of its cards and retail banking.

    However, it saw its loans decrease by 7.3 percent annually to Rp 39.07 trillion in the first nine months from Rp 42.1 trillion in the same period last year.

    The deceleration in loans was in line with data from the Financial Services Authority (OJK) that show that overall lending in the Indonesian branches of foreign banks dropped by 6.61 percent yoy to Rp 253.1 trillion as of August.

    Bank Indonesia (BI) deputy governor Erwin Rijanto attributed the situation to falling foreign-denominated, or forex, loans, which only grew by 2 percent yoy as of July.

    “This is closely related to global economic conditions. We see that a lot of companies with high exposure to forex loans have temporarily reduced their credit demand. Some of them even decided on early termination of their loans,” he said recently.

    The drop in global commodity and oil prices as well as weak trade are among the factors impacting the banking industry, particularly on forex loans, which are mostly utilized to support the financing of exports and imports.

    This portion of forex lending is also particularly big in Indonesian branches of foreign banks as they are supported by their overseas headquarters.

    Meanwhile, Citibank Indonesia’s report also show that its third-party funds declined by 6.6 percent yoy to Rp 5.25 trillion from January to September.

    Despite the decline in the third-party funds, Batara said the bank managed to grow the portion of current accounts and savings accounts (CASA) — consisting of low-cost funds — to 73.9 percent of its total third-party funds.

    The increase in CASA helped jack up its net interest margin (NIM) to 6.1 percent from 5.3 percent in September last year.

    With an increase in revenue, the bank managed to improve its cost-to-income (BOPO) ratio—which measures efficiency—to almost 80 percent in the third quarter of this year from 91.2 percent a year ago.

    The latest performance was translated into an increase in return on assets (ROA) to 4.4 percent from 2.7 percent in the same period last year, while its return on equity (ROE) rose to 16.5 percent from 10.6 percent.

    The bank’s capital adequacy ratio (CAR) also increased to 29 percent in the third quarter of 2016, from 25.3 percent in the same period last year.

    “As we enter the final quarter of 2016, we believe that the progress we have made in the past three quarters will enable Citibank Indonesia to accelerate its growth imperative and commitment to its stakeholders,” Batara said.

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  • Dialog Axiata revenue grows 19% in 9M16

    Dialog Axiata revenue grows 19% in 9M16

    Sri Lanka’s Dialog Axiata has reported a 19% increase in revenue for the first nine months of the year to 64 billion rupees ($430.9 million) as a result of a temporary suspension of value-added tax (VAT) and strong growth momentum across the operator’s business.

    Net profit for the period grew 71% to 7.8 billion rupees as a result of improving profit margins and significantly lower forex losses.

    Dialog Axiata increased its mobile subscriber base by 10% year-on-year to 11.3 million, mostly from prepaid services. The company also recorded 43,000 net additions to its subscription TV service.

    Broadband revenue for the nine-month period grew 27% to 6.76 billion rupees, but the broadband segment recorded a net loss of 62 million rupees due to aggressive fixed LTE and fiber expansion.

    Total group capex for the nine months reached 12.7 billion rupees, with the high-speed broadband investments dominating spending.

    Blended ARPU grew 3.8% during the third quarter to 406 rupees, while average minutes of use edged up by 1 minute to 133.

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  • BMW eyes 100,000 electric car sales in 2017

    BMW eyes 100,000 electric car sales in 2017

    BMW wants to boost sales of electric cars by two-thirds next year to 100,000 vehicles as the luxury automaker is offering more battery-powered models, citing Chief Executive Officer Harald Krueger.

    Munich-based BMW expects to increase its deliveries of fully electric and hybrid vehicles to around 60,000 units this year, Krueger said. Sales of battery-powered BMW models have totaled about 100,000 cars since 2013, he noted.

    “Electric mobility will come, but demand is not going through the roof at the moment,” the newspaper quoted Krueger as saying.

    To help improve sales, BMW is also increasing the battery range of its i3 city vehicle by 50 percent this year. The i3, BMW’s only fully battery-powered car, sold only 25,000 units last year.

    The company, which has dropped behind Daimler’s Mercedes-Benz in global luxury-car sales rankings, wants to expand the share of electric cars and hybrid models to between 15 percent and 25 percent of sales by 2025, the newspaper reported.

  • Indonesia`s wheat flour consumption expected to increase steadily

    Indonesia`s wheat flour consumption expected to increase steadily

    Indonesias wheat flour consumption is expected to increase steadily with favorable growth of wheat-based culinary business, a businessman said.

    “The increased consumption of wheat flour is correlated to the increased number of cafes. In a cafe, usually customers would not order for rice but cakes that use wheat flour as its basic material,” Marketing Manager of Interflour Indonesia, Dhanny Widjaja, said.

    Indonesian Wheat Flour Producers Association (Aptindo) expected the wheat flour demand in the country to grow by five to six percent with the national economic growth in 2015.

    “We believe that the future trend would be positive, as culinary business is a relatively endurable one,” he said, pointing to its potential in breads, biscuits and noodles industries.

    His company has targeted to increase its market share by 10 percent in 2019.

    “This year (the market share) has reached 8 percent with a total production of 2,800 tons per day from two factories in Makassar and Cilegon,” he said.

    The company has focused on cakes, biscuits and noodle industries in its efforts to expand its product distribution, in addition to its retail markets.

    “We focus on expansion, especially to southern Sumatra,” he said.

    The company would also renew one of its factories in Cilegon, which will be inaugurated in 2017 and will have a production capacity of 400 tons per day.

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  • FinTech hub opens in Singapore

    FinTech hub opens in Singapore

    LATTICE80, a not-for-profit FinTech Hub, has opened an innovation facility in Singapore’s central business district.

    The new two level facility has been established with the aim of supporting FinTech firms with product development, testing and go-to-market strategies.

    LATTICE80 measures more than 30,000 square feet and features an open event space with the capacity to host 250 people, a private and public lounge, semi-open and open-plan offices, a cafe, boardrooms, meeting rooms, a podcast studio and a nursing room.

    To date, more than 20 foreign and local FinTech companies and associations at varying stages of growth have signed up to be based at the facility. Solution types being worked on by these firms include blockchain, robo-advisors, trading systems, online marketplaces, financial education, cognitive computing, big data analytics and fund management.

    LATTICE80 has partnered with key financial and technology players such as IBM, UOB, KPMG, MatchMove, EZ-Link, Singapore Fintech Consortium, Femtechleaders SG and Metropolitan Management Services to provide solutions and services like APIs, cloud technology and blockchain to support companies.

    Additionally, the National University of Singapore will work hand-in-hand with LATTICE80 to shape the curriculum for FinTech. It will also involve roll outs of training and capability development programmes particularly in the areas of cybersecurity, payment gateway and developing dynamic mobile applications.

    “We want to create a platform that can support the FinTech ecosystem in Asia and form bridges that link to global players. We’re serious about fostering connections with the technology and financial communities here in Singapore and globally,” LATTICE80 CEO Joe Seunghyun Cho said.

    “We’re co-creating the future of innovation, banking and finance in Singapore and considering the enthusiastic group of start-ups we have today, I’m very confident that we have the foundation to create a truly unique world-class community.”

    Companies onboard LATTICE80 include Spark Systems, which is building new generation trading platforms for hedge funds, banks, financial institutions and other high volume institutional participants in the foreign exchange market, and Percipient, a Singapore-based startup which has developed a customized digital solution for the State Bank of India.

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  • Volkswagen’s Audi in talks with China’s SAIC Motor on tie-up

    Volkswagen’s Audi in talks with China’s SAIC Motor on tie-up

    Volkswagen’s Audi premium brand is in talks with China’s largest automaker, SAIC Motor, on a potential long-term collaboration, Audi said in a statement on Monday.

    Reuters reported on Saturday, citing a source familiar with the matter, that the two had signed an agreement that could pave the way for Volkswagen’s joint venture with SAIC to make Audi brand cars.

    An early entrant to China, the world’s largest car market, Audi is the best-selling premium car brand although it is rapidly losing ground to newer car models from Daimler’s Mercedes-Benz and non-German automakers like Toyota’s Lexus and General Motor’s Cadillac.

    Audi cars are now only made in China through a joint venture with China FAW Group, providing a lifeline to a state-owned company whose own brand cars have struggled with falling sales.

    Audi reaffirmed its commitment to FAW in the release announcing the talks with SAIC, saying it had outlined growth plans with FAW for the next 10 years that include making green energy SUVs and sedans in every major segment.

    Audi will also form a new joint venture company with FAW to be based in Beijing and focus on mobility and digital services, according to the statement.

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  • BHG Retail REIT beats 3Q 2016 DPU forecast by 4.9%

    BHG Retail REIT beats 3Q 2016 DPU forecast by 4.9%

    China-focused BHG Retail REIT has reported a DPU of 1.29 Singapore cents for its 3Q 2016, beating forecast made at listing by 4.9%.

    However gross revenue for the period came in 6% lower than expected at SGD15.4 million (USD10.9 million), while net property income missed its target by 3.5% at SGD9.5 million.

    The REIT has attributed the lower figures to new taxes imposed by the Chinese government, and a weaker RMB against the SGD.

    Distributable income for the period came in at SGD4.5 million, beating expectations by 5.1%.

    “Portfolio occupancy remained high at 97.4%, rents for new and renewed leases turned in another quarter of healthy reversions”, said Chan Iz-Lynn, CEO of the REIT’s manager, in a statement on 11 November.

    The REIT’s gearing was at 30.5%, with weighted average term to maturity of 2.2 years.

    Moving forward, BHG Retail REIT pointed to China’s growing retail sales figure, which expanded by 10.4% year-on-year for the first three quarters of 2016 despite a slowing global economy, as reasons to be optimistic.

    “The higher demand for mid-range retail brands is expected to continue, and will move in tandem with China’s rising middle income population”, said Chan, underscoring her confidence that the REIT’s properties are well positioned for this growth.

    Units of BHG Retail REIT finished trading trading day about 0.8% higher from its previous close on the Singapore Exchange to end at SGD0.59.

  • Germany To Help Iran’s Port Infrastructure

    Germany To Help Iran’s Port Infrastructure

    Germany, which has been aggressively pushing for closer economic ties with Iran following the lifting of international sanctions against the latter, wants to play a pivotal role in the modernizing and upgrading of Iran’s dilapidated infrastructure and transport system. Germany signed six memoranda of understanding (MoUs) aimed at boosting transport cooperation following a late October meeting between Abbas Akhoundi, Iran’s minister of roads and urban development, and Alexander Dobrindt, Germany’s minister of transport and digital infrastructure, who led a delegation of major German shipping, port and marine companies.

    Iranian and German sources said that a German company is participating in a tender for completing two terminals at Chabahar Port in southeastern Iran, which was recently in the news because India is keen to develop it for strategic and trade reasons. German multinational Siemens is holding talks with Iran for developing suburb transport in Tehran and Tabriz, as well as the rail lines between Tehran and Tabriz.

    The lifting of sanctions against Iran has led German business executives and the shipping industry to tap what they describe as “huge business potential.” Hamburg Port, for example, has been trying to identify areas and ways to establish and upgrade ties with that country’s port facilities.

    Since the imposition of sanctions, Iran has struggled to have a normal trading relationship with the outside world. While the German industry has been euphoric – and this applies particularly to Hamburg, whose port prides itself as the “gateway to Asia” – the realities are different; indeed, access to Iran’s lucrative market is not an easy undertaking.

    Strategically located at the crossroads between the Arabian Peninsula and Central Asia, with ports in the Caspian Sea and the Gulf region, Iran is interesting for shipping lines. Iran also offers opportunities for foreign investment in important sectors such as oil and gas, electricity production, air, sea and road infrastructure, telecommunications, etc.

    Described as part of the “Axis of Evil” in 2002, Iran’s breakthrough came on January 16, 2016, when the first of the multiple layers of trade sanctions were removed, breaking the shackles that badly inhibited that country’s shipping and trade, and giving it access to huge sums of money that had been frozen under the sanctions regime.

    However, experts at a special event in Hamburg a few months back told shippers and others that only part of the sanctions had been lifted on January 16. While the ban on imports of Iranian oil and gas products, and against the country’s ship-building and shipping sectors, had been lifted along with restrictions on bank remittances, the situation remains complex in the sector of so-called “dual use” goods, which can be used both for civilian and military purposes.

    One of the first to take advantage of the lifting of sanctions was European aerospace company Airbus, which has bagged aircraft orders from Iran Air to replace its outdated A340 aircraft. The city of Hamburg, experts say, could flank trade with Iran by providing expertise in several areas, including modernization of Iran’s fleet of mercantile ships.

    US companies are not, yet, permitted to have dealings with Iran, although their associate companies in Europe can do so. However, weapons and certain police equipment are still prohibited. Also prohibited are deals with companies that are controlled by Iran’s revolutionary guards or those that have supported Iran’s atomic programme.

    Iran has been trying to recruit German companies to set up operations, particularly in the seven free trade zones in Iran for which the government has been dangling carrots in the form of incentives, including a 20-year tax holiday. Since Iran is keen to join the World Trade Organization, it has been trying to highlight the fact that many of its old agreements on trade and legal protection are in force. However, new companies to be established in Iran will be governed by certain religious laws and, as such, are required to have a Persian name or title, as Iranian legal experts have been saying during meetings with German companies. “Such a requirement can be a deterrent because many German companies are unsure what the implications would be on their business. I would suggest that companies do their homework before moving large-scale investments to Iran,” one German-Iranian told on the condition of anonymity.

    Meanwhile, Iran is in a rush to catch up with the rest of the world by modernizing its infrastructure and its economy.

    Hamburg and its port stand to benefit immensely from Iran’s opening. In 2014, German exports to Iran amounted to some €2.4 billion (approximately US$3.1 billion, in 2014 dollars), while imports from Iran were about €300 million, according to numbers from the German Statistics Bureau. Hamburg’s two-way trade with Iran amounted to roughly €214 million in the same year. International trade experts at Hamburg’s Chamber of Commerce are optimistic that German trade with Iran would double from its present level after all sanctions are lifted.

    Some 353 companies based in Hamburg already have business connections with Iran. Despite sanctions, some of these companies maintained business ties with Iran even during the embargo period. Hamburg, which is by far the world’s leading trading hub for Iranian products, including carpets, has the largest concentration – about 20,000 – of Iranian nationals or people of Iranian origin in Germany; the city hopes to resume its once flourishing trade and shipping through the Iranian diaspora.

    Another important German state interested in trade with Iran after the lifting of sanctions is Hesse, which recently sent a 40-member delegation led by Hesse minister for economics, energy and transport Tarek Al-Wazir to Iran. The trade volume between Hesse and Iran was around €212 million in 2015 (US$230 million), according to the state’s economics ministry.

    “The reputation of products and services offered by Hesse is traditionally good in Iran,” Al-Wazir said. There is huge potential in the expansion of the processing industry, the transport infrastructure and in urban development.

    During German minister for economic affairs and energy Sigmar Gabriel’s visit to Iran in early October, Gabriel’s second visit to Iran within 14 months, Iran’s oil minister had said that German banks were becoming a hindrance. “We have billions (of dollars) with which we could do good business with the Germans,” Bijan Namdar Zangeneh, the oil minister, was quoted as saying after his meeting with Gabriel in Tehran.

    The money cannot be transferred due to problems with the banks. Iran’s minister told journalists that that “is bad for us, but also bad for the Germans.”

    Germans say that although the sanctions against Iran were lifted in January, trade has not made much headway. A precluding factor is that part of the punitive measures – the so-called secondary sanctions – imposed by the United States are still in force. German and European banks are, consequently, dissuaded from financing Iran deals. In 2015, for example, Germany’s Commerzbank paid a hefty US$1.45 billion fine to US authorities because of violating American sanctions in deals with Iran. France’s large bank BNP Paris also had to pay a billion-dollar penalty.

    Iran’s economy has not done badly, with the International Monetary Fund forecasting an average growth rate of 4% for the next five years. Official Iranian projections suggest a GDP growth rate of 5% for 2016.

    Iran’s neighbour Turkey is also eyeing the opportunities unfolding in Iran; Turkey offers itself as an ideal transit point for German and other western companies wanting to enter Iran. Turkey trumpets its “manifold advantages,” particularly, for SMEs which can enjoy customs duty benefits. Turkish experts, who say that all the machinery and production tools in Iran are outdated, believe that German companies, with their past trade relationship with Iran, can look forward to a welcoming market with huge investment needs.

    Some German companies are looking at using Turkey to tap Iran’s huge business potential. Since 2014, Turkey has a preferential trade agreement with Iran. This agreement eliminates many customs duties. German companies can save customs duty twice because Turkey, a member of the European Customs Union, exempts German products from customs duty on exports to Turkey. All products shipped from Turkey to Iran are treated as Turkish products and thus spared the customs duties.

  • PayMaya Philippines, JCB team up to widen JCB cards acceptance in the Philippines

    PayMaya Philippines, JCB team up to widen JCB cards acceptance in the Philippines

    PayMaya, the Philippines’ pioneering financial services provider, and JCB International Co., Ltd. (JCBI), the international operations subsidiary of JCB Co., Ltd., have forged a new partnership for JCB Merchant Acquiring and Card Issuing business in the Philippines. The partnership deals with the acceptance of JCB cards at online merchants that use PayMaya Checkout as the payment gateway. PayMaya and JCBI also plan to issue co-branded cards in the future.

    PayMaya Business is focused on delivering solutions that power businesses of all types and sizes to accept all kinds of payments. The services PayMaya Business provides are PayMaya Checkout, a system that enables online shops to accept card payments, PayMaya Swipe, a mobile point-of-sale device that can simply be attached to any mobile device so merchants can accept card payments, and PayMaya Touch, a payment solution which allows businesses to accept swipe, dip, and contactless card payments.

    The partnership will benefit all JCB cardmembers in the Philippines and overseas. JCB is a pioneer in the Japanese payment card industry with over 70M cardmembers and 95M in total worldwide. JCB cardmembers will be able to use their JCB cards at online merchants that use PayMaya Checkout as their payment gateway.

    In 2017, JCB cardmembers will also be able to transact in big retail outlets in the Philippines but also in micro- and small-medium enterprises including local boutiques, food carts, and community stores which offer a unique shopping experience through PayMaya Swipe and Touch. These outlets prefer more affordable and easier payment acceptance solution like PayMaya Swipe, Checkout, and Touch.

    Kimihisa Imada, Deputy President of JCBI, said, “The Philippines is one of the most important markets for JCB’s global business expansion and we are pleased to welcome our new partner to the JCB network. I am certain that this partnership with PayMaya will bring more benefits and convenience to all JCB card members, especially in the e-commerce space. We are also looking forward to exploring further business opportunities such as ‘PayMaya-JCB Card’ issuance soon.”

    “At PayMaya, we strive to shape the future of commerce and drive local business growth through digital payment innovations. We are strengthening this commitment by collaborating with strategic partners such as JCBI, which help us enable merchants to accept payments from more consumers here and abroad. We are thrilled to see the progression of our alliance with JCBI as we continue our mission in redefining the payment landscape in the Philippines,” said Orlando Vea, President and CEO of Voyager Innovations and PayMaya Philippines.

    The JCB “Uniquely Yours” Experience

    JCB is a major global payment brand and a leading payment card issuer and acquirer in Japan. JCB launched its card business in Japan in 1961 and began expanding worldwide in 1981. Its acceptance network includes about 31 million merchants and over a million cash advance locations in 190 countries and territories. JCB cards are now issued in 21 countries and territories, with more than 95 million card members. As part of its international growth strategy, JCB has formed alliances with hundreds of leading banks and financial institutions globally to increase merchant coverage and cardmember base. As a comprehensive payment solution provider, JCB commits to provide responsive and high-quality service and products to all customers worldwide.

    The unique benefits of PayMaya Business

    PayMaya handles the requirements of merchants in enabling their online and card payment acceptance–no need to talk to banks, expert programmers, or payment aggregators separately.

    For online payment, PayMaya Checkout API is easy to integrate in websites or apps. The process involves three simple steps: integration to sandbox environment, testing, and production.

    PayMaya provides simple pricing and fast settlements. Merchants are not required to settle monthly fees or present bank statements. They will only pay for the transactions they make. The package comes with access to a dashboard of transaction reports for sales performance tracking.

    The Philippine Airline’s mobile website and its recently launched online boutique, and the online gadget store Kimstore are powered by PayMaya Checkout.

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  • Oppo R9 becomes the best-selling device in China

    Oppo R9 becomes the best-selling device in China

    The latest smartphone OS sales data from Kantar Worldpanel ComTech shows a solid 5.2% percentage point US market share increase for iOS during the third quarter of 2016 to 34.2%. Both iOS and Android made gains across most of the EU5 countries. However, Android posted a 3.3 percentage point decline in the US from 66.7 to 63.4%, while iOS share fell in Germany from 17.5% to 15% and in Urban China from 18.7% to 14.2%. 

    Europe’s big five markets include Great Britain, Germany, France, Italy, and Spain.

    In Urban China, Android accounted for 85.3% of smartphone sales in the third quarter of 2016, its second highest share ever in this market. 

    “Oppo continues to see significant growth, gaining 8.2 percentage points over the past year to become the 4th largest manufacturer in Urban China with 11.2% of smartphone sales. The Oppo R9 overtook the iPhone 6s as the best-selling device in the third quarter,” reported Tamsin Timpson, Strategic Insight Director at Kantar Worldpanel ComTech Asia. “iOS posted yet another year-on-year decline to 14.2% of smartphone sales in the third quarter of 2016. Importantly, this marks a period-on-period return to growth in sales, up from 13.5% in the three months ending in August. With supply constrained on the iPhone 7, and particularly the 7 Plus, this positive turn for Apple is a good sign, suggesting that as supply grows to meet demand, Apple will be able to turn the tide in Urban China.” 

    “In the US, the new iPhone 7 and 7 Plus models made an immediate impact, becoming the best-selling smartphones in the month of September at 17.1%,” said Lauren Guenveur, Consumer Insight Director for Kantar Worldpanel ComTech. “Strong sales of the iPhone 7 and the lower-priced iPhone 6s, the second best-selling device in the US in September, contributed to an overall growth of iOS to 34.2% in the third quarter of 2016.

    “Despite some sales from the beleaguered Samsung Galaxy Note 7, still technically available through the month of September, Samsung posted a year-on-year decline from 36.9% to 33.8% of US smartphone sales in the third quarter,” Guenveur continued. “The holiday sales season may prove to be more challenging than normal for Samsung, who competes head-to-head with Apple during this crucial time of year. Fallout from the Note 7 recall could have an unintended impact on continuing sales of other, similarly-named Samsung devices (chiefly the Galaxy S7 and S7 edge), as consumers may not always understand the difference between the model names. However, deep holiday discounts, as we saw with the Galaxy S6 last year, may counteract any expected negative impact, as the driving reason for choice among US consumers remains finding a good deal on the price of the phone.”

    “In Great Britain, the iPhone 7 and 7 Plus were top-sellers during the month of September, accounting for 15.1% of sales,” said Dominic Sunnebo, Business Unit Director for Kantar Worldpanel ComTech Europe. “In the third quarter of 2016, iOS accounted for 40.6% of smartphone sales, a 2.4 percentage point increase from the same period a year ago. It’s interesting to note the continued success of the iPhone SE in Britain, accounting for 8.5% of sales in the quarter vs. a share of just 3.5% in the US.” 

    “Britain is the only market where Samsung made year-on-year gains, totaling 30.4% of smartphone sales,” Sunnebo added. “In Italy, Huawei replaced Samsung as the reigning smartphone leader to become the top brand sold at 27.3%, a 15.2 percentage point gain vs. the third quarter 2015. Samsung accounted for 24.7% of smartphone sales in Italy, a decline from 40.6%. In Spain, Huawei and Samsung are now neck-and-neck, with Samsung edging out Huawei 24.2% vs. 23.3%.”

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  • Indonesia has role in tourism development in maritime silk route

    Indonesia has role in tourism development in maritime silk route

    Indonesia has an important role and can take advantage of tourism development in the maritime silk route of the 21st century in China, according to China National Tourism Administration (CNTA) Information Center Director Cai Jiacheng.

    “Indonesia has its own uniqueness as a global tourist destination, especially for the countries along the maritime silk road of the 21st century in China,” Jiacheng told.

    According to him, Indonesia has a lot of cultural diversity and unique and attractive natural sceneries that can make the country a world tourist destination.

    “However, Indonesia must fix the infrastructure and build good connectivity with a number of other countries, particularly with countries along the maritime silk road,” Jiacheng noted.

    “Indonesia should actually be able to provide maximum services, ranging from easing visas and providing adequate infrastructure, including connectivity, to attract tourists to come to the country,” he added.

    Jiacheng added that Chinese travelers can visit other countries through the ASEAN countries such as Indonesia, Thailand and Singapore.

    “Therefor e, Indonesia has opened the path for China to ASEAN, because of its strategic position to support tourism development in the maritime silk road of the 21st century that can also provide a great advantage for the country,” he said.

    Tourism is playing an increasingly important role in the economic growth of China. Tourism sector accounted for about 10.8 percent of the total growth in Gross Domestic Product (GDP) and 10.2 percent of the national job last year.

    CNTA is targeting 137 million foreign tourists to visit China in 2016, or up to 2.5 percent compared to that of the previous year, while the amount of targeted revenue from foreign tourist arrivals is US $ 121 billion, up by 6.5 percent over the previous year.

    “Therefore, China is serious to work on the tourism sector by using destination packages, connectivity, and the use of information technology for marketing and promotion,” he said, adding that Indonesia can take advantage of the tourism development in the maritime silk road of the 21st century.

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