Retail News CRM

Author: Mei Ling Tan

  • China is our future says Walmart Asia CEO

    China is our future says Walmart Asia CEO

    China will drive more than half the world’s retail growth over the next decade, Walmart Asia CEO Scott Price has told the Asia-Pacific Economic Cooperation (APEC) CEO Summit in Manila.

    Despite slowing economic growth, the world’s largest retailer still believes in the power of the world’s most populous nation, referring to October’s retail sales figures showing 11 per cent year on year growth, and September’s 10.9 per cent.

    The Singles Day record set last week of US$14.3 billion further underlined the spending potential of Chinese consumers.

    Price highlighted the performance of the company’s wholly-owned Chinese online retail subsidiary Yihaodian on Singles Day which he described as “great’ without revealing data.

    He said the company had opted to take full ownership of Yihaodian this year to make the most of the “gamut of opportunities” in the burgeoning online-to-offline (O2O) market where shoppers order online and collect instore.

    “We think online-to-offline is critical, as customers look for convenience, and convenience is not just one mode.”

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  • Paipai.com axed to fight counterfeiting

    Paipai.com axed to fight counterfeiting

    China’s number 2 eCommerce player JD.com has axed its consumer to consumer online storePaipai.com in a bid, it says, to cut sales of counterfeit goods.

    The store will be closed by December 31 and after a transitional period of three months, the company will completely close down the website of Paipai.com.

    “The shutdown of the C2C platform is in line with the company’s policy to combat the marketing and sale of counterfeit products and the company will make persistent efforts to protect the interests of consumers and brands,” JD.com said in a statement.

    Paipai.com, along with another site Wanggou, were acquired from WeChat parent Tencent in March 2014. The combined businesses have a goodwill and intangible asset value of US$400 million, making it a very expensive gesture in the war against counterfeit goods in Mainland China.

    The company says it has yet to calculate the book value of the loss given the two websites are accounted for in the books as a combined entity and Wanggou will continue to operate.

    While JD.com is amputating a limb, Alibaba is undergoing a high profile battle in the US courts with French luxury brand owner Kering which alleges Alibaba has failed to take sufficient steps to counter the trading of counterfeit goods on its various websites, as reported by Inside Retail Asia last week.

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  • Indonesia Emerging as New Battlefield for ICT Companies

    Indonesia Emerging as New Battlefield for ICT Companies

    Korean mobile companies are making inroads into the Indonesian market one after another. The Korean mobile industry anticipate that Indonesia will rise as a new mobile market since the nation has the world’s fourth largest population and its many islands gave rise to the creation of a mobile service-friendly culture.

    According to the Ministry of Science, ICT and Future Planning on Nov. 19, the number of mobile service subscribers stood at 303.69 million as of the end of 2013. This figure was up 7.3 percent from a year before. Its penetration rate was staying at 121.5 percent. The Asian Mobile Consumer Report says that about 15 percent of all of Indonesia’s mobile service users were using two or more cell phones as of Sept. 2013.

    The report added that 24 percent of them were using smartphones, so the penetration rate of smartphones is expected to rise. Two Korean internet business leaders –- Naver and Kakao – began to preempt the Indonesian mobile platform while focusing on messenger services since Indonesia has a mobile market with great growth potential. In particular, the nation is planning to transform its 2G mobile telecommunication infrastructure into 4G long-term revolution (LTE) before hosting the Asian Games in 2018.

    At the moment, the 2G service accounts for 75% of the mobile service infrastructure in Indonesia. With the opening of a big mobile market momentum, Korean mobile messengers began to enter the market ahead of other foreign companies.

    Naver is ranked second in the Indonesian messenger market after its global messenger “Line’ took the Indonesian market in 2012. The number of monthly average users of Line grew to 26 million in the first quarter of this year from eight million in the first quarter of last year.

    Kakao is spurring its expansion in the Indonesian market by taking over assets of Indonesian SNS Path and Path Talk for 22 billion won. Path is the third biggest SNS after Facebook and Instagram in Indonesia. Its monthly average users add up to ten million. Three years ago, Kakao Talk made a foray into Indonesia and has been inking 18 million downloads. The company is aiming at taking Indonesia as a springboard to the global market by expanding synergies with Path.

    Pantech is planning all-around strategies to invade the Indonesian mobile market such as smartphones, communication equipment and the internet of things (IoT). The company already announced its plan to take Indonesia as a toehold for its revival when it exchanged hands. First of all, Pantech is planning to export a total of 300,000 units of mid- to low-priced smartphones to Indonesia within the second half of next year. It is said that the company will produce the products in the OEM system at factories in Southeast Asian countries for price competitiveness.

  • Pitney’s Borderfree Expands Online Catalog to Woo China

    Pitney’s Borderfree Expands Online Catalog to Woo China

    Pitney Bowes Inc. subsidiary Borderfree is expanding its online shopping catalogue for Chinese online customers to serve their penchant for America-based consumer products. The company intends to provide these customers with more options for American brands in fashion, sports apparel and lifestyle accessories ahead of the upcoming holiday season.

    In particular, Borderfree has extended its partnership with China’s e-commerce giant Alibaba Group Holding’s subsidiary company, Ant Financial’s Alipay (an online payment services provider). This will allow China-based consumers to purchase directly from the retailer’s websites using localized payments. Borderfree’s collaboration with Ant Financial helps obliterate currency and logistics barriers, allowing leading global retailers to explore the Chinese soil.

    Borderfree realizes that customer security is paramount in online transactions and hence, is working closely with payment and marketing platform “Alipay ePass” (which allows U.S. merchants to gain access to Chinese consumers with an Alipay account), to woo in major crowd this holiday season. On the other hand, this deal also enables Alipay’s 400 million registered customers to access the products of a wide range of international retailers including Aéropostale, MotoSport, Bloomingdale’s, Macy’s and Saks Fifth Avenue at comparable prices.

    In our opinion, the incredible growth of online shopping in China, which likely accounts for over 40% of the world’s retail e-commerce according to EMarketer, is enough to bank on the profitability of this particular deal. Moreover, the fact that the U.S. happens to be the leading e-shopping destination of the world further brightens the commercial attractiveness of Pitney Bowes.

    Earlier in June, Pitney Bowes completed the acquisition of Borderfree to complement its e-commerce business. Encouragingly, this gave the company a first-mover advantage for exploring a multibillion-dollar market, which enjoys a double-digit growth rate. Notably, company sources suggest that the rapidly growing Chinese e-commerce sector is emerging as the key driver of the nation’s overall economic growth, primarily fueled by increased Internet penetration and surge in smartphone ownership.

    We believe the approaching holiday season will witness colossal growth in online purchase data, and this bodes well for Pitney Bowes’ profitability. Moreover, integration of the Borderfree business with its global e-commerce business will help the company reap significant cost-synergies in the long run.

    Pitney Bowes currently has a Zacks Rank #3 (Hold). A better-ranked stock in the industry is Advanced Emissions Solutions, Inc., that holds a Zacks Rank #2 (Buy).

     

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  • SM Prime opens third mall in Cebu

    SM Prime opens third mall in Cebu

    SM Prime Holdings, Inc., one of the leading integrated property companies in Southeast Asia, opens today its newest regional landmark, SM Seaside City Cebu.

    In a disclosure to Philippine Stock Exchange, SM Prime said this is its 56th mall in the country, and the third mall within Cebu – along with SM City Cebu and SM City Consolacion.

    The new destination mall provides an additional 430,000 square meters (sqm) in gross floor area (GFA), expanding SM Prime’s total retail space to 7.3 million sqm in the Philippines.

    SM Seaside City Cebu is the first of many developments in the 30-hectare SM Seaside Complex which SM Prime president Hans T. Sy said will take about five years to fully develop.

    SM Seaside City Cebu, located within the SM Seaside Complex at the South Road Properties (SRP) in Cebu City, is the first of its kind in urban development in the SRP.

    As the anchor development, the mall is slated to transform the city’s landscape as SM Prime builds residences, offices, an arena, a five-star hotel, and convention centers.

    The Complex features “The Cube”, a steel sculpture that symbolizes strength and stability of Cebuanos and its consistency reflects SM’s continued commitment to excellence.

    “We are inspired by the success of our Mall of Asia Complex in Pasay City, the first lifestyle city project or mixed-use development that offers retail, residences, offices, hotels and convention centers,” Sy said.

    He added that “we are replicating this concept of ‘lifestyle cities’ in Cebu as we open the SM Seaside City mall. We see Metro Cebu as one of our important growth corridors in Visayas and Mindanao following our growth track in Metro Manila.”

    The new destination mall will open with 80 percent of space lease-awarded which serves as the new home to flagship stores of well-known local and international brands. It will also be the venue of unique and world-class events and entertainment.

    The shopping mall will have anchor tenants such as The SM STORE, SM Supermarket, Forever21, UNIQLO, Our Home, Ace Hardware, SM Appliance Center, Watson’s, The Body Shop, Kultura, BDO Unibank, and Chinabank.

    SM Seaside City Cebu is the newest architectural jewel of SM Prime with its nautilus inspired design of concentric arcs from a central multi-purpose space featuring a “Seaside Tower,” a 147-meter iconic viewing tower which offers a sensational panoramic view of the entire city.

    A Sky Park provides a  unique setting for diverse dining outlets situated in an elevated garden with soothing water features. The mall will have a skating rink, eight cinemas houses and 5,000 parking slots.

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  • DFS partners with kid’s Make-A-Wish charity

    DFS partners with kid’s Make-A-Wish charity

    For the second year running, DFS Group is partnering with Make-A-Wish International (www.worldwish.org) this December in its #JoyToYourWorld charity campaign to help children fighting life-threatening medical conditions by granting their special wishes.

    Jay Frame, DFS Group’s Vice President Corporate Communications and CSR said: “We are thrilled to partner with Make-A-Wish International for the second year in a row and share the goodwill of our customers, employees and partners to help these children’s wishes come true.”

    The retailer says that crowdsourcing and social media combine in this charity campaign and DFS customers can help to grant wishes by following @DFSOfficial and liking posts tagged with #JoyToYourWorld. DFS says that for every #JoyToYourWorld post that receives 1,000 ‘likes’, it will donate to Make-A-Wish International to help grant up to nine wishes to children around the globe.

    Coinciding and honouring DFS’ 55th anniversary, an equal 55 celebrity ambassadors are supporting this year’s campaign, including past DFS campaign spokespeople Godfrey Gao, Ming Xi, Caroline de Maigret and Perry Liu.

    DFS says: “The mission of Make-A-Wish is to grant the wishes of children with life-threatening medical conditions to enrich the human experience with hope, strength and joy. Since its inception in 1980, Make-A-Wish has collectively granted the wishes of more than 350,000 children in nearly 50 countries. Each wish that comes true inspires these seriously ill children to persevere against their illnesses.”

    Make-A-Wish International President and CEO Jon Stettner said: “We are proud to renew our partnership with DFS and its ambassadors this holiday season to help grant even more wishes to deserving children facing serious illnesses. It’s through the support of partners like DFS and its customers around the globe that make these life-changing wishes possible.”

    Amongst those children DFS helped to grant wishes to last year around Asia was Evan, an eight-year-old from Hong Kong battling acute lymphoblastic leukaemia. He wanted to be an astronaut and lift off was duly granted when he attended NASA’s Space Camp in Alabama, US.

    Then there was Mostafa, a 17-year-old from Japan suffering from congenital biliary atresia and pancreatic cancer. He wanted to be a racing car driver and his wish came true when he sat in a Ferrari 138 driven by two-time Formula 1 champion Fernando Alonso.

    This year, DFS and Make-A-Wish International will grant wishes to children like Wang-yau, a nine-year-old boy from Hong Kong battling spinal muscular atrophy who wishes to travel abroad, or Joanna, a 10-year-old girl from Singapore in treatment for medullablastoma, who wishes to become a pastry chef.

    As part of all this, DFS Group is generously encouraging customers to help out with donation boxes placed within its T Galleria by DFS stores worldwide. These will be available at its 11 T Galleria outlets in Hong Kong (3), Macau (4), Singapore, Auckland, Okinawa and Hawaii as well as its DFS Gallerias in Cairns and Sydney.

    In addition – and again celebrating DFS’ 55th anniversary – 55 celebrity ‘ambassadors and influencers’ have signed up this year to help support the #JoyToYourWorld Campaign. These include famous actors, models, make-up artists, photographers, a princess, an athlete, photographers, fashion bloggers, singers and many more.

  • Paul & Shark makes Korea debut launch inside Incheon

    Paul & Shark makes Korea debut launch inside Incheon

    Paul & Shark will launch its first store in South Korea with a new point of sale opening at Incheon International airport with Lotte Duty Free, and will also open its first personalised boutique onboard cruiseship Costa Fortuna.

    “Our new opening in Incheon will enable us to enjoy truly spectacular visibility for the brand. Along with the Lotte store we have another two openings planned in Seoul by the first quarter of 2016, giving Paul & Shark a very strong foot-print in the South Korean travel-retail market. These openings are both downtown duty-free – one with Donghwa and another with SM Duty Free.”Both stores will make its inaugurate launch next month. “We are so excited about these two projects,” said Paul & Shark Worldwide Travel Retail director Catherine Bonelli. “The Costa Fortuna is a beautiful ship and to have our own standalone boutique onboard is a real coup. Opening in December in the run up to Christmas could not be better timing and we’re expecting really good sell-through during the month.

    This continues a trend that has seen a 55% increase in openings for Paul & Shark over the past 18 months, of which Bonelli said around half were located in airports and the rest with cruiselines and downtown duty-free stores.

    After coming back from a busy TFWA World Exhibition last month, Bonelli sees a rosy future next year. She added that openings in 2016 were earmarked at Pudong terminal one in partnership with King Power Orient; Hong Kong International airport with Lagardère Travel Retail, and Houston with ATU-Heinemann.

    Speaking of last month’s TFWA, she added: “Cannes, with our new stand, was an incredibly busy and successful week for us with head to head appointments all week,” said Bonelli. “Our personalised embroidery service was again a particular talking point and has become a real stand-out highlight for us.

    “It’s been an incredibly busy and hardworking year for the Travel Retail team but the effort is certainly paying off and we are being rewarded with superb locations for the brand. We are confident that 2016 will be another exceptional year for us, as retailers continue to understand and realise the business potential of partnering with Paul & Shark.

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  • Apple’s Fifth Retail Store in Beijing Opens November 28

    Apple’s Fifth Retail Store in Beijing Opens November 28

    Apple has announced that its fifth retail store in Beijing, and 27th in China, opens Saturday, November 28 at 10 AM local time. The store will be located in the new Chaoyang Joy City shopping mall at 101 Chaoyang North Road in Beijing’s city proper Chaoyang District.

    The new store will be open 10 AM-10 PM local time everyday and offer traditional Apple Store services, including the Genius Bar, Workshops, JointVenture, events and seminars. Apple’s four other retail stores in Beijing are located at China Central Mall, Sanlitun, Wangfujing and Xidan Joy City.

    Apple has opened more than seven new retail stores in China this year, including locations in Chongqing, Dalian, Hangzhou, Hong Kong, Nanjing and Tianjin. The company is committed to expanding its footprint in China, an increasingly important market, under the leadership of retail chief Angela Ahrendts.

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  • ASOS launches mobile apps for iPhone, iPad and Android in China

    ASOS launches mobile apps for iPhone, iPad and Android in China

    Developed using retail technology specialist Red Ant’s award-winning RetailOS mobile commerce accelerator, the apps are:In a first for the UK’s largest independent online fashion and beauty retailer, ASOS has launched mobile apps for iPhone, iPad and Android to the Chinese market.

    • Fully transactional mobile app designed specifically for the 700 million-strong Chinese smartphone user market
    • Feature rich and fully shoppable with hybris commerce platform and Alipay
    • Features include Catwalk for all products, access to personal profiles, wishlists and Chinese social sharing

    Social media buzz suggests it has been well-received by ASOS customers and the fashion industry:

    • “I appreciate the fashion sense of ASOS’ fashion buyer, the items on the app attracted me so much and the app is more convenient than selecting on the website. I can also share the items with my friends from my phone, it is very warm and useful for us.”

    Men’s Health Assistant Editor Yu Qing

    • “Cool! Finally I can view the ASOS products in clear categories instead of spending a lot of time searching for what I want on Tmall. It’s more convenient.”

    Rayll Beauty Fashion Editor Kich

    ASOS’ general manager – China, Daniel Jenks, said: “ASOS is dedicated to delivering the best possible experience to our customers in China, and the launch of our apps, backed by Red Ant’s expertise, is a significant step towards ensuring they receive a high-quality, mobile-first service which meets all of their needs in an increasingly sophisticated marketplace. We’re delighted with the results so far and in the space of a few weeks, app downloads and sales have exceeded our expectations to form a substantial mix of our sales.”

    Red Ant’s CEO Dan Mortimer said: “As the UK continues to forge stronger and more profitable business relationships with China, we are delighted to be the mobile partner of choice in the Far East for one of the world’s most successful and reputable online retailers. The local knowledge and expertise of our team on the ground in Asia has been invaluable in developing an app which makes the most of the commercial opportunities presented by the world’s biggest mobile market.”

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  • Online seafood retailer iChef rolls out nationwide store pick-up

    Online seafood retailer iChef rolls out nationwide store pick-up

    Online seafood company iChef is expanding its physical retail operations even as more grocery retailers are moving into the online space with e-concierge shopping services and free deliveries.

    Four-year-old iChef opened its second store at the basement level of The Cathay this week, and is also rolling out pick-up services around the island. Its first outlet is in Tai Seng, where the company’s offices are.

    A subsidiary of Suki Group – which operates eight chain restaurants here, including Sakura International Buffet, Saboten and Chabuton – iChef sells packaged frozen seafood items, such as snow crabs, oysters and prawns, as well as frozen beef and chicken, on e-commerce site Qoo10.

    The items sold by iChef come from the same seafood wholesalers that supply items served in the Suki Group of restaurants.

    Customers can head down to the stores to make their selection, or choose to pick up their online orders, made via Qoo10, from either outlets. Otherwise, free delivery is provided only on orders of $80 and above.

    It is also introducing store pick-up services across its 10 Nihon Mura sushi restaurants across the island.

    Singapore’s online grocery retailer space has exploded recently, with nearly a dozen marketplaces opening up to offer fruits, vegetables, seafood, meats and other grocery products to busy consumers. Supermarket giants NTUC and Cold Storage offer a selection of its in-store inventory on its online store, while others like GoFresh, focuses on selling fresh produce such as fruits, vegetables and meats.

    Homegrown start-up honestbee is a grocery buying concierge service that has its staff of shoppers pick up items directly from nearby supermarkets located close to a customer, while e-commerce services such as Qoo10 and Rakuten offer specialised perishable food items from its sellers, including frozen oysters, king crabs and salmon fish roe, as well as fresh seafood flown in directly from Japan.

  • China forecast to lead APAC in online spending

    China forecast to lead APAC in online spending

    China will lead the Asia-Pacific region in online spending this holiday season with $150 billion in sales forecast, new research from Adobe Digital Index reveals.

    China’s booming economy has led to the highest anticipated online spend in the region (55 percent), with nearly half of the country’s consumers surveyed (49 percent) predicting an increase in their online spend for the period.

    The average Chinese Internet user is predicted to spend a total of $210 online during November and December, driving one-fifth of total online sales for the year.

    Adobe’s global Online Shopping Prediction is based on an analysis of 55 million product SKUs and aggregated and anonymous data of more than one trillion retail websites over the last seven years. The holiday season represents 20 percent of worldwide online spending – with Austria and the US at the top of the list.

    Across the rest of APAC, consumer spend is expected to remain steady year-on-year with 14 percent and 16 percent of Australians and Singaporeans respectively, anticipating they will increase their total spend this holiday season.

    Japan is expected to see the second highest online spend in the region with $37 billion in online sales (a 5 percent year-on-year growth) predicted, followed by Australia at $7 billion.

    The survey found that consumers in APAC are not only shopping online more, they are also becoming increasingly efficient, with 20 percent or more in each country surveyed saying they expect to spend less time holiday shopping this year compared to last – a saving that could give them more time to spend with their families and friends.

    “Holiday shopping is a huge investment and consumers get more sophisticated every year with their online and mobile shopping in order to secure the most popular gifts at the best prices,” said Tamara Gaffney, principal research analyst, Adobe Digital Index.

    Meanwhile, Gaffney said Southeast Asia is expected to lead the charge in mobile shopping with 21 percent of e-commerce purchases to be transacted via smartphones and around 10 percent via tablets.

    Japanese shoppers won’t be too far behind, with 24 percent of e-commerce purchases predicted to be made via smartphones and 6% via tablets.

    Consumers are also finding online shopping less stressful than heading to the stores. In Australia, almost one-in-five (19 percent) consumers rated offline shopping as extremely stressful, compared to only 6 percent who said the same about online shopping. China is the only country in the region where online and offline shopping are seen as equally stressful.

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  • iTrueMart enters Philippines, plans to invest $55 million

    iTrueMart enters Philippines, plans to invest $55 million

    iTrueMart, Thailand’s leading e-commerce retailer, has launched its first e-commerce site in the country, iTrueMart.ph, and targets to be the dominant local e-commerce player in two years.

    In 2016, the online retailer, one of the companies under Bangkok-based Ascend Group, plans to invest over USD$150 million (more than P7 billion) in the ASEAN Economic Community (AEC) as part of its regional expansion.

    “The investment will be used for e-commerce optimized fulfillment centers, logistic hubs, expansion of our own fleet, marketing, and ramping up assortment and inventory,” announced Ascend Group CEO Punnamas Vichitkulwongsa.

    “We are debuting our operations in the Philippines. Vietnam, Indonesia, Myanmar, Cambodia, Malaysia, and Singapore will follow later in 2016. We are committed for long-term success in the Philippines and everywhere else that we go to,” he underscored.

    “Competition in the e-commerce sector in the Philippines is still considered low. With the market still in its infancy, there are still plenty of opportunities for new players,” Dean Krstevski, Chief Operating Officer E-Commerce of Ascend Group, reasoned.

    “Now that the e-commerce market is being developed, brands are increasingly looking for partners to sell their products online, which we see as a great advantage that will help us speed up our market entry. We are confident of our success in the Philippines because we have a strong team with extensive experience in both online and offline retail.”

    They are investing about US$4-5 million in the Philippines this year and easily $50 million in 2016.

    The Philippines is iTrueMart’s second destination in AEC, bringing access to a variety of products, various payment channels and competitive pricing currently limited to metropolitan shoppers.

    “E-commerce will have huge potential when the AEC fully materializes,” confirmed Ascend Group CEO Punnamas Vichitkulwongsa.

    According to a study by Ystats SE Asia eCommerce, the volume of ASEAN’s mobile Internet users rose 56% in 2015. Up to 56% of the Thai and Vietnamese populations are now accessing the Internet via their smartphones, a figure close to the Philippines’ 50% rate.

    Recognizing the growing number of mobile-Internet users, the Ascend Group is confident that online shopping in the region will also grow.

    Furthermore, “iTrueMart.ph is not a newcomer to the market as the team is backed by the strong success of iTrueMart in Thailand,” according to iTrueMart General Manager Seubsakul Sakolsattiyathorn.

    During the past year, the number of visits to iTrueMart.com increased 424%.

    Since October, 2014, the retailer averaged 4.6 million  visits per month. iTrueMart.com receives 7,000 orders per day on average, with the highest volume of daily orders at 10,000, the highest record in Thailand’s online retail industry.

    Add to that, iTrueMart.com’s delivery averages at two days throughout Thailand and it enjoys the lowest e-commerce return rate in the country.

    Under the slogan “Great Value, Everyday,” iTrueMart.ph works only with authorized distributors of international brands and act as authorized dealer of local brands so customers can be guaranteed that all products on the website are genuine.

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  • Moreh gets first shopping complex

    Moreh gets first shopping complex

    Manipur’s Moreh which borders Myanmar got its first multi-storied shopping complex on Wednesday. Deputy chief minister Gaikhangam, who also holds the home portfolio, inaugurated the complex that comprises 82 shops, a car parking site, a conference hall and a food court.

    The gateway to South East Asia, Moreh, in tribal-dominated Chandel district, sees business of around Rs 5 crore daily.

    The Rs 21-crore shopping complex, set up under the aegis of the ministry of commerce and industries, is located near border gate number 2, one of the busiest areas in Moreh and 110 km from Imphal.

    Addressing the inaugural ceremony, Gaikhangam emphasized on the need for peace and harmony to enhance commercial activities in the border town.

    Echoing Gaikhangam, state industries minister Govindas Konthoujam said peace would allow rapid progress in trading at Moreh. Meanwhile, construction of a multi-crore Integrated Check Post is also under way at Moreh. The town, through which the Trans-Asian Highway passes, was among 13 sites in the country selected for construction of ICPs.

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  • Hong Kong flight takes food from paddock to plate in a day

    Hong Kong flight takes food from paddock to plate in a day

    A VEGETABLE grower is excited about the prospect of his product going from the ground to the dinner plates of Hong Kong within 24 hours. Geoffrey Story is among many from Toowoomba and the region who are preparing to tap into the lucrative Asian market.

    As the first international freight flight out of Wellcamp airport prepares for lift-off on Monday, companies say it will be a game-changer. In a trial run for freight transport out of the region, a Cathay Pacific Airways Boeing 747-800F will fly to Hong Kong packed full of Darling Downs produce. Story Fresh has farms at Cambooya, Grantham and Clifton and is looking to break into the export market. The company already exports on Cathay Pacific from Brisbane but said Wellcamp would be logistically more convenient.

    “We see the opportunity for this airport to do it better because we’re closer and we can get product there quicker.” He said Australia had a good reputation for high quality and standard of food. The plane will also carry 14 tonnes of high quality chilled Black Angus grain fed steak.

    Warwick beef producer Rangers Valley is another of the companies taking the opportunity to use the service. It will ship to Hong Kong on Monday with about half going to food service like high end restaurants and the rest being sold in retail stores. The company has been selling products in Hong Kong for about a decade and usually uses the Cathay service out of Brisbane.

    Andrew Moore is marketing manager from the company’s Warwick office and called the flight a great opportunity for producers. “Once all the infrastructure is in place at Wellcamp there will be transport advantages. “It’s great to be part of this first shipment to see how it works.”

    Over the past 12 months, the company has air freighted about 700 tonnes of high quality chilled Wagyu and Black Angus grain fed beef to customers across the globe. Mr Moore said the ultimate plan was to use Hong Kong as a hub to export beef products across Asia. The flight arrives at 2.30pm. A public viewing area will be established.

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  • What Are The Key Drivers Of Growth For Estee Lauder?

    What Are The Key Drivers Of Growth For Estee Lauder?

    Focus on the online sales channel, digital initiatives, and revival of its travel retail channel, will be the key drivers for Estee Lauder‘s (NYSE:EL)  growth in the future.  While travel retail showed tremendous growth in 2014, the slowdown in China and natural calamities had a negative impact in 2015.  Estee Lauder feels this setback is temporary and we believe new product launches and initiatives in this segment will boost its revival, and will be a key driver of growth for the company. With booming e-commerce and mobile internet penetration, we believe focus on online sales will be another driver of growth for the company, especially in emerging economies such as China.

    Revival Of The Travel Retail Channel

    In the fiscal year 2014, Travel Retail was one of the highest growth channels for Estee Lauder contributing to 13% of its product distribution. Global Airport retailing information reveals that by 2016, airport retail spending will be $23.2 billion for Asia Pacific, whereas for the Americas and Europe the figures will be $10.1 billion and $12.4 billion. Estee Lauder is leveraging this trend primarily to capture the Asian market. In May 2014, the company launched a flagship boutique at the Detroit Metro Airport, a primary gateway to Asia, via Delta Airlines. This boutique offers a collection of all its luxury brands, High-Touch services, along with other facilities such as a first-class lounge area, free Wi-Fi, and updated information on the flights. Growth in the travel retail channel slowed down in Q4 2015 due to the macroeconomic slowdown in China and spread of MERS virus in Korea, but the company believes this setback is temporary. It is continuing to emphasize  skincare, its most profitable product category, to boost travel retail sales. Estee Lauder recently launched a vast array of products under several brands including Clinique, Bobbi Brown, Jo Malone, Tom Ford, and M.A.C., at the Tax-Free World Association (TFWA) Exhibition, held at Cannes in October. The products include face contouring, eye makeup, lipstick, serums, treatment creams, and fragrances. These new products will be available across Estee Lauder’s travel retail channel. [].We believe revival of the travel retail channel will be a key driver of Estee Lauder’s revenues in the future.

    Focus on Online Channels And Digital Initiatives

    The shift towards online shopping is evident from the tremendous growth in e-commerce.  New York based research agency, L2 ThinkTank.com found that while the global beauty industry grew at 6% in 2013, sales through the e-commerce channel witnessed a 29.1% growth during the same period. To leverage this trend, Estee Lauder is selling 14 of its brands directly to consumers online through approximately 120 of its own e-commerce and mobile commerce sites.  The company also launched  “Forecast,” a mobile application under its Clinique brand, which provides weather information and skin care tips based on weather conditions.  To expand in the Chinese market, Clinique opened its  flagship store on Alibaba’s Tmall. According to the National Bureau of Statistics cited in Statista, the online transaction value of cosmetics retailing in China is forecast to grow by 123% in 2015. Given the market potential, we believe Estee Lauder’s focus on online sales and digital initiatives, around the use of social media and mobile apps for promotion, will be key drivers of its revenue in the future.

     

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