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Category: General

Retail News Asia is committed to providing both local and global retailers with the latest General Retail news throughout the Asian market. This on a daily base.

  • World catches the Chinese holiday shopping bug

    World catches the Chinese holiday shopping bug

    Chinese consumers have long enjoyed the annual ritual of shopping in the run-up to Spring Festival in January or February, and now e-commerce is beckoning shoppers worldwide to share in the fun.

    Elena Zhang, sales manager of Xi’an Silk Road Crafts Co, said the company started receiving overseas orders for Spring Festival in July last year.

    One order last month came from Spain, for more than 1,000 red hanging lanterns made of Chinese fabric.

    Orders for various products related to Chinese New Year had come in from Canada, France, Germany and Russia, she said. AliExpress, a website that sells made-in-China products to overseas customers, is by far the most used online shop.

    Our China Dream series of lanterns are the bestsellers among overseas Chinese this year. It belongs to Alibaba, China’s largest e-commerce player. “Fabric lanterns priced between $1.50 and $4.30 (£1-3) each were the most popular items this year,” Ms Zhang said.

    “Overseas buyers usually place their Spring Festival orders in summer. But we have had orders at the end of the year, too. Enthusiasm overseas in Chinese New Year shopping seems to be increasing, and e-commerce is helping increase sales.”

    Sales by AliExpress to overseas consumers from the city of Yiwu, Zhejiang province, well-known as a centre for small commodities, have risen sharply since the company began to ship worldwide on Dec 31.

    To the end of January it had shipped more than one million parcels overseas. One of the companies making full use of this new service is Yiwu Wonderful Lantern Co.

    Xia Rongwang, the company’s manager, said many overseas orders had been placed since the middle of January, especially from overseas Chinese in countries such as Malaysia.

    Some buyers said the lanterns make them feel as though they are back home celebrating new year

    “Our China Dream series of lanterns are the bestsellers among overseas Chinese this year. Some buyers have said the lanterns make them feel as though they are back home celebrating the new year.”

    Apart from Spring Festival-related items such as lanterns, overseas consumers are buying other products made in China selling at bargain prices in the holiday period and just before it. DHgate, a Chinese online wholesale marketplace, said sofa and bed cushions are particularly popular among Canadian shoppers.

    Russians are said to be the most numerous overseas buyers. AliExpress says they love buying clothes made in China, their keenness to shop online spurred by a depreciating rouble. Consumers in countries where winters tend to be very cold buy made-in-China down jackets and other winter-wear.

    Felix Zhang, sales manager for Shaoxing Goldson Dress Co in Zhejiang province, said Chinese down jackets in the $40 to $47 price range are popular among buyers in Kazakhstan, Estonia and Latvia. “We offer discounts of up to $500 for buyers who order more than 10,000 down jackets. The reason is obvious: Online selling means we cut the costs resulting from going through intermediaries.”

  • Vietnam risks losing entire retail market to Thailand

    Vietnam risks losing entire retail market to Thailand

    Industry insiders have warned that Vietnam is on the brink of losing its entire retail market to neighbor Thailand. Made-in-Thailand goods, from confectionery to luxury items, are making their largest-ever ‘invasion’ of the Vietnamese market, and many local firms are looking like being acquired by Thai investors.

    Last month, Thailand’s TCC Holding Co. officially acquired Metro Cash & Carry Vietnam’s operations from Germany’s giant retailer Metro Group for an enterprise value of €655 million (US$712.14 million).

    The business includes 19 wholesale stores and related real estate portfolios across Vietnam.

    Another major Thai investor, Berli Jucker (BJC), is also is keen to buy the Big C Vietnam supermarket chain from its French operator, Casino Group.

    The French company reportedly wanted to sell its Vietnam business after completing the transfer of its business in Thailand, Thai Big C, to home player TCC in a $3.5 billion deal earlier this month.

    “If Big C Vietnam is sold to a Thai investor, it can then be said that the entire Vietnamese retail market is in Thailand’s hands,” said Vu Kim Hanh, chairwoman of the Business Association of High-Quality Vietnamese Goods.

    In 2013, BJC acquired the Vietnamese convenience store chain from Japan’s Family Mart and renamed it B’s Mart.

    Later that year, Family Mart teamed up with a new Vietnamese partner to keep the Family Mart chain running, not to be confused with the Thai-operated B’S Mart.

    “A supermarket chain is the missing piece at a time when Thai companies are already running wholesale markets, convenience stores, and even traditional retail channels in Vietnam,” Hanh told us recently.

    With multiple retail channels under their control, Thai investors can easily cut costs and increase competitiveness, and “it will be more difficult for Vietnamese goods to enter Thai-controlled retail outlets,” Hanh said.

    In fact, Thai goods are currently dominating the B’s Mart chain in Vietnam following its acquisition from Family Mart, according to the director of a processed food company.

    “There have been huge changes in the way these stores source products, with Thai candies, snacks and packaged food dominating shelves,” she told Tuoi Tre.

    A real threat

    Shelf space for Thai goods has also increased in other Thai-owned retail channels in Vietnam.

    One executive from a Ho Chi Minh City-based frozen foods trading firm said they had stopped making private-label products for Metro late last year, even before the cash and carry business was sold to TCC.

    Private-label goods are typically those manufactured or provided by one company sold under another company’s brand name.

    “Several procedures have taken longer than usual since the Thais have controlled Metro,” she added.

    “It took me six months to pull some products from their shelves, and requests to adjust prices also took a long time to be effected.”

    Other Vietnamese businesses said the trading policies of Metro, under the new owner, have changed a lot.

    “We are offered higher commissions, but sales have been much slower,” one company director said.

    N.T.C., director of a fresh food producer, said Metro Cash & Carry Vietnam has a new marketing policy that openly favors Thai suppliers.

    “Across product categories, only the Thai ones are subject to repeated promotional campaigns, which leave Vietnamese suppliers like us in shock,” he said.

    The presence of Thai-made products has even increased in retail outlets not owned by the Thais, including South Korea’s Lotte Mart and Co.op Mart, which is Vietnam’s largest supermarket chain.

    “Thai businesses are receiving huge support from the government, in terms of both policies and capital, in their ‘invasion campaign’,” said Vo Xuan Trung, director of IBP Co., a local distributor of Thai snacks.

    While there used to be only one annual Thai goods fair in Ho Chi Minh City, the event has been held four times annually since 2014, Trung said.

    “Having said that, we should acknowledge that most Thai products are of better quality and available at more attractive prices than their local competitors,” he said.

    Tran Anh Tuan, general director of Pathfinder, a Ho Chi Minh City-based market consulting firm, said it was a real threat for Vietnam to lose its home market to Thai retailers.

    “Once Thai retailers are in Vietnam, it is certain that they will try to increase the presence of their goods,” he said.

    Tuan underlined that timely policies should be made before the second, bigger risk comes.

    “Soon we will see not only our consumers rush to buy Thai goods, but also Vietnamese firms acquired by Thai investors,” he warned.

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  • New ‘Siam Discovery-the Exploratorium’ to open Q2 as Thailand’s first hybrid retail store

    New ‘Siam Discovery-the Exploratorium’ to open Q2 as Thailand’s first hybrid retail store

    Siam Piwat Co., Ltd., the owner and operator of prestige retail developments such as Siam Paragon, Siam Center, Siam Discovery, and Paradise Park, as well as the joint venture partner of ICONSIAM, today, announced that it is introducing a revolutionary new retail concept to Thailand with the opening of the new Siam Discovery retail destination in the second quarter of 2016, after a Bht 4,000 million re-build.

    Mrs. Chadatip Chutrakul, Chief Executive Officer of Siam Piwat Co., Ltd. said: “The new Siam Discovery is the first hybrid retail destination in Thailand.  We have created a venue where thousands of lifestyle brands are brought together under a single universal concept that puts customers at the centre, rather than brands.  That means everything presented at Siam Discovery is not organized by brand, or category, as in traditional retailing, but by the visitors’ interest, because our purpose is no longer just to sell products but to provide an extraordinary and emotional experience to the visitor allowing them to discover themselves, as well as express themselves.

    Mr. Oki Sato, Chief Designer and Founder of nendo and Mrs. Chadatip Chutrakul, Chief Executive Officer of Siam Piwat-1

    “We then enhance that experience by presenting a story rather than just products, and by making the experience in our store highly interactive as well as allowing visitors to personalize their purchases.  We give visitors opportunities to make a statement about their life preferences, whether it be about sustainability or a love of nature, and to support those preferences through their purchases, and through occasions to interact with like-minded people and communities.  And then we further enhance those experiences through the power of the most advanced digital technology,” she said.

    Mrs. Chutrakul added, “Taken together, this new retail format makes a visit to the store an exciting, emotional experience that gives visitors a great opportunity to play, to experiment, to discover and re-discover themselves.  We want people to fall in love with that experience.

    “Our role as a retailer has advanced to another level and become one of managing visitors’ experiences and emotions at the destination, rather than just one of managing products, categories and displays,” she said

    “We target all genders and all age groups, and there is something for everyone at all price points,” Mrs. Chutrakul said.

    “Come Play With Me”

    Empowering visitors to create their own personal style

    Siam Discovery Infographic

    According to Mrs. Chutrakul, “The new Siam Discovery says ‘Come play with me!’ to visitors, inviting them to experiment by trying out new products, new ideas, re-thinking conventions, and customising their purchases, all across 40,000 square metres of floor space.”

    “We are completely overturning past retailer practice of organising and presenting products by brand or category.  Instead, at the new Siam Discovery, multiple brands and complementary merchandise are brought together for the convenience and enjoyment of the visitor and unified with underlying stories.  They are organised and presented by type, function, relevance and, most importantly, the visitor’s interest.

    “This is a pioneering retail concept that empowers visitors to mix and match across brands and categories to discover, define and create their own distinct, personal style, while also pursuing related interests and passions that need not be tied to any purchase intent.  It has never been done before in Thailand and on such a scale, and it’s a concept that will bring new excitement to any visit to Siam Discovery.  We estimate it will also double Siam Discovery’s per-square-metre sales within a year,” she said.

    Mrs. Chutrakul added that the new Siam Discovery is called ‘The Exploratorium’ and is a ‘lifestyle lab’ because it allows every individual to explore who they want to be and what is the style that best reflects their true self without the constraints of a particular brand or school of design.  She said that visitors can try new ideas across the hundreds of categories and more than 5,000 international and local brands on offer, many of which are first-time-in-Thailand brands.  It includes everyday products, sustainability products, trend products, collaboration and limited edition collections, as well as innovative products.

    Visitors can go even further in experimenting with creating their own style because the new Siam Discovery also provides bespoke personalisation opportunities that let customers tailor their purchases to their own personal preferences.

    Immersive Story-Telling, Advanced Digital Technology, Interactive Experience

    The presentations of products have a very strong story-telling component.  As visitors move through the various parts of Siam Discovery, they are immersed in the heritage and the intangibles of a brand and a category.  They are also drawn into stories relevant to their interests, their beliefs, and trends rather than just being presented a selection of products.

    “These experiences are enriched and heightened through advanced digital technology as well as many interactive experiences that are offered to the visitor.  It’s a totally new and an extraordinarily exciting way of presenting products and their associated lifestyles,” she said.

    “As part of this ‘immersive experience’, Siam Discovery has created areas for people of similar interests to interact, share experiences, make friends and create their own communities, whether they be designers, sportsmen, collectors, health gurus, or travellers.  Not only can they do things with other people, they can also do things for other people: through their purchases, they will be able to indulge in their passions and convictions, such as supporting sustainability or other causes important to them,” she added.

    Siam Discovery Visual Ad-1

    Thailand on the World Stage

    Mrs. Chutrakul noted that the introduction of a revolutionary, new retail concept will reinforce Bangkok’s appeal as the retail hub of the ASEAN Economic Community (AEC) and help make the city a favourite shopping destination for the world.

    “Siam Area is Bangkok’s top-ranked retail destination with more than two million square metres of world-class attractions and the widest variety of shopping, dining, art, culture and education offerings in Thailand, attracting traffic of over 160 million visits, annually.  The new Siam Discovery enriches the total package of offerings in Siam Area by introducing a completely new proposition,” she said

    Top Global Designer ‘nendo’

    ‘nendo’ (Mr. Oki Sato), who is one of the world’s top designers and a person voted as among the ‘100 Most Respected Japanese’ by Newsweek Magazine, provided the overall design inspiration for the new Siam Discovery.  He was engaged as the chief consultant for the building design as well as the interior design, while Urban Architect Co., Ltd. was the Thai architectural design and interior design company for the project.

    The new Siam Discovery is nendo’s largest project, ever, and his first in Thailand.

    Mrs. Chutrakul said, “We invited nendo to provide the inspirational design concept for Siam Discovery because Siam Piwat looks at the future from a global perspective rather than just the potential of the Thai market.  This is because Siam Piwat is committed to the business of creating extraordinary experiences for customers who are not only Thai people but also visitors from every corner of the world.

    “In line with our growth strategy, Siam Piwat is creating unprecedented destinations in Thailand that can compete with the best of the world’s destinations and help support Thailand to become a top-ranked global retail and entertainment paradise.”

    “Within the first year, we aim to have 100,000 people a day visit and fall in love with the new Siam Discovery, of which around 65% are expected to be Thai and 35% to be international visitors.  What our visitors will have in common will be their progressive, independent-minded outlook on life, and a passion to explore and try new things,” she said.

    The new Siam Discovery follows from Siam Piwat’s highly successful Bht 1,800 million     re-build of Siam Center three years ago, which pioneered a revolutionary retail development concept where the developer worked collaboratively with retailers and brand owners to give the entire venue a consistent visual identity that is clearly and distinctly Siam Center.  The concept has been showered with eight highly prestigious international awards, including recognition as one of the world’s 5 best-designed retail centres by the retail industry’s leading international association – the International Council of Shopping Centers (ICSC).

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  • Retail In China Suffers From New Year’s Hangover

    Retail In China Suffers From New Year’s Hangover

    While sales surrounding China’s Lunar New Year gave some retailers reason to celebrate, that was not the case for all of them.

    As a result, the stock value of a number of jewelry and cosmetics retailers in the country dropped yesterday. Analysts told the outlet that lackluster New Year sales were felt particularly hard by those sellers with locations in smaller neighborhood malls, as opposed to ones housed in larger ones, which saw a greater influx of foot traffic during the holiday period.

    Another factor that contributed to the stock slide for jewelry and cosmetics retailers in the region, was a dropoff in shopping by mainland tourists during the Lunar New Year. Sa Sa International, for example, reported to the outlet that its sales to mainland tourists fell 26 percent from the same period last year, with the average number of transactions among that consumer group decreasing 18 percent and the average ticket cost falling 9 percent.

    “This showed a further deterioration from the third quarter [for Sa Sa] as the Chinese tourist arrivals widened to a double-digit decline during the period,” Bocom International.

    Credit Suisse, meanwhile, told the outlet that it had visited nine shopping malls in China during the Lunar New Year and found that the majority of them were less busy within that period than they normally are on any given weekend.

    “The era of easy money in the retail industry has come to end,” Maureen Fung Sau-yim, a director of Sun Hung Kai Properties subsidiary, Sun Hung Kai Development. “Looking ahead, we have to work harder to cope with the market change” (referring to, explains the outlet, a stronger Hong Kong dollar and fewer mainland tourists).

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  • Hong Kong to post surplus even as economy grapples with China slowdown

    Hong Kong to post surplus even as economy grapples with China slowdown

    Hong Kong is forecast to post a healthy fiscal surplus in its annual budget on Wednesday, with a series of one-off sweeteners expected to help businesses hurt by a slowdown in China, including the hard-hit retail and tourism sectors.

    Hong Kong’s longstanding Financial Secretary John Tsang isn’t expected, however, to unveil any sweeping new initiatives amid concerns the government’s reliance on one-off measures are failing to bolster the city’s economic fundamentals as it enters a period of slower growth and heightened political tensions.

    Tsang wrote on his official blog on Sunday that while sweeteners may only account for 1 percent of Hong Kong’s annual budget, they provide an important boost for the local economy and job market, and play an important “stabilising” role.

    A night-long riot shook the city after the authorities tried to remove illegal street stalls during the Lunar New Year, the worst violence since pro-democracy protests in 2014.

    While Hong Kong has tended to post healthy surpluses over the past decade, pressures are mounting on some of the economy’s biggest drivers. Mainland Chinese tourists who power the territory’s all-important retail sector stayed away from the city last year, leading to the worst annual decline in sales since 2002.

    Hong Kong officials have also sought to integrate more closely with China through Beijing’s “One Belt, One Road” blueprint to deepen regional economic co-operation, though the details remain sketchy.

    Four economists surveyed by Reuters expect fourth quarter growth to slow to a seasonally adjusted 0.1 percent from 0.9 percent in the third. From a year earlier, growth was forecast at 2 percent, down from 2.3 percent in the third quarter.

    Six economists estimated the economy would expand 2.3 percent in 2015, slightly less than the official forecast of 2.4 percent.

    The global financial hub’s economy is highly reliant on China which is grappling with its slowest growth in nearly 25 years.

    The government is forecasting a surplus of HK$36.8 billion while professional services firm Deloitte expects HK$80 billion.

    Despite a recent softening in the city’s sky-high property prices, analysts expect cooling measures implemented over the past few years to stay in place. Standard & Poor’s has forecast a 10 to 15 percent drop in property prices in 2016.

    Hong Kong’s economic pressures come on top of an increasingly fraught political environment, including the disappearances and feared abductions by Chinese agents of several Hong Kong booksellers, and lingering tensions towards Beijing’s refusal to allow full democracy in Hong Kong after protesters occupied major roads for 79 days in late 2014.

    The former British colony, with a population of 7.3 million, returned to Chinese rule in 1997 under a “one country, two systems” framework that gave it a large degree of autonomy although its leaders ultimately defer to Beijing.

  • BKPM Launches Easy Investing Service

    BKPM Launches Easy Investing Service

    The Investment Coordinating Board (BKPM) has launched two investment services for the convenience of investors. The first service is called KLIK, which is short for Kemudahan Investasi Langsung Konstruksi, a.k.a. simplicity in direct investment for the construction sector. The second is a three-hour service for permit upgrade in the infrastructure sector.

    In the launching ceremony at the Mercure Hotel in Jakarta, Monday, February 22, BKPM chief Franky Sibarani said the KLIK facility is a convenience provided by the government to companies willing to invest in specific areas. There are 14 industrial areas in six provinces and nine regencies/cities established to implement this service. The areas cover 10,022 hectares of effective land from a total land size of 17,154 hectares.

    With KLIK, Franky said, investors can immediately build their projects after obtaining the principle license.

    The launching ceremony was also attended also by officials from relevant ministries including the Public Works and Public Housing Ministry, the Energy and Mineral Resources Ministry, the Transportation Ministry, and the Ministry of Communication and Information. Also present were officials from the Attorney General, the Indonesian National Police, and representatives from provinces associated with the KLIK program: North Sumatra , Banten, West Java, Central Java, East Java, and South Sulawesi.

    In a press conference held at the same day, Franky said the investment facilities are given as a way to enhance Indonesia’s competitiveness and help meet the government’s investment target of Rp 594.8 trillion in 2016.

  • Tyco Retail Solutions Opens New Office in Tokyo

    Tyco Retail Solutions Opens New Office in Tokyo

    Tyco Retail Solutions (www.tycoretailsolutions.com) is pleased to announce the opening of its new Tokyo office to meet the growing need for Store Performance Solutions in Japan, the world’s third-largest economy. As Japan-based multinational retailers are upgrading technology and expanding in Asia, Tyco is strengthening its presence to support retailers’ demand for new technologies, including RFID for which the adoption rate in Japan is ahead of other Asian markets.

    According to PwC’s report, “2015-16 Outlook for the Retail and Consumer Products Sector in Asia,” retail sales in Asia are expected to top U.S. $10 trillion by 2018. Japan, home to a number of internationally recognized designer brands, will remain a cornerstone of the global fashion industry. PwC reported that Japanese fashion continues to influence apparel and footwear trends in many other countries.

    Tyco has served the Japanese retail market for 45 years, focused on loss prevention solutions and customer relationships managed through certified business partners. Building on its success in the region, Tyco is reinforcing its RFID resources on the ground to support key retail global accounts.

    As the retail industry undergoes transformation, RFID has emerged as a critical, enabling technology for retailers competing in an omni-channel world and a cornerstone for the retail Internet of Things (IoT). Progressive retailers understand the critical role of RFID-based inventory visibility to maximize revenue, improve store operations, and meet the demands of today’s consumers. Tyco has seen significant momentum, not only in the number of retailers deploying RFID, but also in the number of stores and merchandise categories designated for RFID roll-outs. It is gaining increased value as an essential technology for solving inventory challenges.

    “The Tokyo site represents our continued investment in IoT technologies such as RFID, which helps deliver meaningful, tangible business benefits for our customers,” said Nancy Chisholm, President, Tyco Retail Solutions. “Our expansion in the region allows us to keep pace with their needs and deliver the quality solutions, products and services they have come to expect over the years.”

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  • Garuda Indonesia Attains “5-Star Airline” Award for second year running

    Garuda Indonesia Attains “5-Star Airline” Award for second year running

    National flag carrier Garuda Indonesia has been awarded the ultimate “5-Star Airline” rating from Skytrax for a second year running. This year’s award was presented to the President & CEO of Garuda Indonesia, M. Arif Wibowo, by Edward Plaisted, CEO of Skytrax, at the Changi Exhibition Center during Singapore Airshow 2016.

    Indonesian Minister of State-Owned Enterprises Rini Soemarno, Indonesian Ambassador for Singapore I Gusti Ngurah Swajayam, and President Commissioner of Garuda Indonesia Jusman Syafii Djamal were present during the ceremony. Minister Rini Soemarno expressed her highest regards “for all Garuda management and staff, their hard work, and their success in maintaining the quality and standards that exemplify a “5-Star Airline”.”
    “We believe that recognition of Garuda Indonesia as a “5-Star Airline” for consecutive years will not only help to strengthen Garuda Indonesia as a global brand, but also support our efforts at “Nation Branding”, as laid out in the Indonesian government’s strategic program,” Rini added.

    As the national flag carrier, Rini said, Garuda Indonesia was succesfully representing the Republik of Indonesia with this achievement. “But success also brings a larger challenge for Garuda Indonesia, to continuously improve the quality of their service, and deliver this service to all customers on the ground and in the air.”

    The Minister finished by suggesting that the global achievement would be followed by better financial results, and extended her appreciation for Garuda Indonesia’s turnaround financial results which ended in net profit for 2015.
    M. Arif Wibowo, President & CEO, Garuda Indonesia, expressed that “The 5-Star rating reflects the hard work and deep commitment from both management and staff at Garuda who continuously deliver their best efforts to maintain and improve the company’s performance in all business aspects.

    “This achievement will be an important milestone for Garuda Indonesia in 2016, as well as being a challenge for everybody in Garuda Indonesia Group to constantly improve performance and deliver service excellence to all customers,” Arif said.
    The “5-Star Airline” certification was awarded following the ongoing Skytrax Audit, with comprehensive points covering all service aspects; pre-flight, in-flight and post-flight, including ground handling services, lounge, seat and cabin comfort, inflight meals and inflight entertainment.

    Skytrax CEO Edward Plaisted said that the “5-Star Airline” rating awarded to Garuda Indonesia for two years consecutively was a result keeping consistently high service standards.
    “In the globally competitive airline industry, Garuda Indonesia proved that they can survive and even perform to the highest values and service standards. The consistency of product and service quality is the most important part in a 5-Star certification audit, and we proudly announce that Garuda’s aircraft are offering the variety of classes that is a requirement of a 5-Star Airline,” Edward added.

    Spurred on by a strong commitment from the airline’s management and staff to deliver best service, Garuda Indonesia’s performance continues to earn global recognition. In 2013, Skytrax awarded Garuda Indonesia for “The World’s Best Economy Class”. This continued in 2014, with recognition as “The World’s Best Cabin Staff”, a “5-Star Airline”, and 7th rank in “The World’s Top 10 Airlines”.

    At the World Airline Awards, Paris Airshow 2015, Garuda Indonesia was once again named “The World’s Best Cabin Staff”, based on a global customer satisfaction survey conducted by Skytrax of more than 18 million passengers. The survey, which covers 245 international airlines, is held every year and measures standards across 41 key performance indicators of airline products and services.

    As part of a fleet revitalization program throughout 2016, the Garuda Indonesia Group will receive 16 new aircraft in total; 1 Boeing 777-300ER, 4 Airbus A330-300, 4 ATR72-600, and also 8 Airbus A320 to be operated by Citilink. By the end of 2016, Garuda Indonesia Group will operate a total of 188 aircraft; 144 aircraft for Garuda Indonesia and 44 aircraft for Citilink.
    To continue the positive growth achieved during its “Quick Wins” program in 2015, Garuda Indonesia will enter a “Sky Beyond” program for 2016 aiming at rapid company expansion, focusing on three ‘core strategies’ – company group synergy, effectiveness and efficiency, and service enhancement – to accelerate company achievement and performance.

    As part of its company synergy, the Garuda Indonesia Group joined Singapore Airshow, Asia’s largest aerospace and defence event. This was Garuda Indonesia’s first participation as a Group, as only a subsidiary, the Garuda Maintenance Facility AeroAsia, had participated in the past.

    The presence of Garuda Indonesia Group at the Singapore Airshow follows Group strategy to develop brand image, to elaborate potential business, to enhance business relations with stakeholders, and to boost up the awareness to Garuda Indonesia Group’s strategic role as Indonesia’s trade envoy in international level.
    At Singapore Airshow 2016, the Garuda Indonesia Group, through Garuda Maintenance Facility AeroAsia, looks to several short- and long-term business contracts, with a value of nearly USD 100 milion.

    Garuda Indonesia currently has 6 subsidiaries with diverse business sectors; Garuda Maintenance Facility AeroAsia, specialized in integrated aircraft maintenance, including engine and aircraft components repair service; Citilink, a low cost carrier (LCC) airline projected for budget traveller; Aerowisata, specialized in hospitality, transportation, catering and travel agent service; Gapura, specialized in ground handling service, supoorted by cargo and warehousing service; Asyst, specialized in IT and consultation service; and Abacus – which now has transformed to Sabre Travel Network Indonesia – specialized in technology provider service for global travel and tourism.

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  • Swarovski and DFS put customers in the frame

    Swarovski and DFS put customers in the frame

    Throughout February 2016, shoppers who make purchases at selected T Galleria by DFS stores in Hong Kong and Macau can enjoy an ‘exclusive’ silhouette portrait created by local artists as part of a new Swarovski campaign.

    The portraits are gifted in a Swarovski paper frame decorated with the brand’s iconic crystals.

    The service is now available at the T Galleria by DFS stores in Canton Road and Tsim Sha Tsui East in Hong Kong, as well as at City of Dreams and The Shoppes at Four Seasons in Macau.

    Swarovski-DFS-Valentines-Day-offer2

    Karen Tse, Director, Travel Retail Asia Pacific, Swarovski, said: “Swarovski believes that the shopping experience is crucial to how consumers appreciate and value our brand and our exquisite jewellery.

    Swarovski-DFS-Valentines-Day-offer1

    “That is why we have been introducing innovative consumer events such as the Valentine’s Day portrait offer. We
    want to give Swarovski customers an enjoyable memory of visiting our shops and that’s particularly important in prime locations for tourists such as our shops in T Galleria by DFS.”

    Jason Blejwas, Director Merchandise, Sunglasses, Fashion Watches and Jewellery, Global Merchandising, at DFS Group Limited, said: “We’re excited to partner with Swarovski to bring our T Galleria by DFS customers another exciting activation that celebrates our local destinations as well as our fantastic Swarovski product offering.

    “We’re confident this delightful and engaging in-store experience will make for a memorable trip for visitors to Hong Kong and Macau this Valentine’s Day.”

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  • Asian retail outlook: “more cautious”

    Asian retail outlook: “more cautious”

    High operating costs – particularly rents and labor in Asia – will ensure retailers are more cautious this year, concludes real estate specialist CBRE.

    In its annual Asian retail outlook, the company’s research department predicts many retailers will shift their strategic focus from expanding their store networks to rationalisation, improving in-store profitability and upgrading to better locations.

    That trend is expected across the broad Asia-pacific market, including Hong Kong.

    “Leasing activity will diverge across markets, with Australia, Japan and New Zealand the most upbeat, whereas Hong Kong and Singapore will continue to struggle,” CBRE concluded.

    “Driven by ongoing urbanisation and wage increases, Southeast Asia will also see solid leasing activity. Demand across the region will be led by food and beverage retailers, while affordable and niche luxury brands will also be active.”

    CBRE also warns the rise of online shopping will continue to force shopping malls to embrace ‘retail-tainment’ and adjust their trade mix to include more experience-oriented retailers to retain foot traffic. Around 63.8 million sqft of new shopping center supply is scheduled to be completed in 2016. Against the sluggish leasing demand and ample new supply, overall retail rents are forecast to experience a mild correction of below 1 per cent in 2016.

    In a broader property outlook, CBRE forecasts that due to Asia Pacific’s steady economic growth – which will continue to outpace the rest of the world in 2016 – investment activity in the region will remain solid, although activity will be limited by asset pricing and availability.

    “The region’s investment market will continue to see strong demand from real estate funds and institutional investors. Institutional investors will continue to invest in Asia Pacific to increase their exposure to real estate for strategic diversification,” said Dr Henry Chin, head of research, CBRE Asia Pacific.

    “That said, Asia Pacific will enter a period of slower growth in the commercial real estate market with activity likely to moderate over the course of the year as it becomes more challenging to source investable stock able to meet investors’ target returns. Interest rates will remain low in 2016 so yields are largely to remain stable across Asia Pacific. However, we are expecting to see a mild yield expansion in 2017 together with the rise in interest rates.”

    The economic slowdown in China – as well as higher-than-expected US interest hike rates, and currency volatility – will also remain a key concern for investors, given the scale of its impact across the whole region.

    “However, macro trends of urbanisation and the rise of the middle class remain largely unchanged and will continue to drive growth across Asia.

    “There are structural investment-themed opportunities for investors to focus on in 2016, such as the growth of e-commerce, regional tourism and demographic changes. Demographic changes will create opportunities in niche sectors such as self-storage facilities, senior and student housing, and data centers,” said Chin.

    “Regionally, active markets will continue to be led by Australia and Japan, whilst India expects to see a positive year following the relaxation of FDI norms at the end of last year.

    “China will also remain on the radar for most international investors although demand will be largely confined to tier I cities. Overall, the long-term outlook remains positive for the region,” he concluded.

    CBRE’s 2016 APAC Real Estate Market Outlook report can be downloaded here.

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  • Spring Festival retail gloom

    Spring Festival retail gloom

    Fortune seems to have favoured Macau over Hong Kong during last week’s Spring Festival.

    But both territories suffered from the ongoing change in Mainland Chinese travel habits.

    Data from the Macau Government Tourism Office showed 548,536 tourists arrived in Macau between February 7 and 10 – which equates to a 5.2 per cent increase over last year’s holiday season. Some 70 per cent of them came from Mainland China.

    However, anecdotal reports from Macau shopkeepers say the increased visitor numbers during the Spring Festival retail break did not translate into higher spending in stores.

    According to the Macau Daily Times “a majority” of retailers it spoke to reported “a drastic drop in business” from mainland visitors.

    One – a fireworks vendor – reported a 50 per cent decline in sales, and other retailers selling apparel and beauty products also reported a decline.

    One cosmetics retailer said sales rose 10 per cent, and snack food stores reported trading was on a par with last year.

    In Hong Kong, where retail sales estimates have yet to be reported, the number of Mainland Chinese visitors fell by about 10 per cent – and the number of groups by an alarming 70 per cent, to about 120 groups per day. So clearly, there will have been a negative impact on retail sales for the week.

    Shopkeepers in Mong Kok, where a violent riot erupted on Monday, reported far fewer tourists in the area.

    “From Monday till now, no one would like to come to this area,” one retailer told local news media.

    “There are more police than tourists. My business is not even half as good as last year, what can I do? What should I do after the holiday?”

    But on the mainland, Ministry of Commerce data shows retail sales rose 11.2 per cent during the Lunar New Year ‘Golden Week’ from February 7 to 13. According to the data, sales by retailers and catering firms grew to about 754 billion yuan, or US$114.879 billion.

  • Chinese New Year Holiday Retail Sales Spike 11.2%

    Chinese New Year Holiday Retail Sales Spike 11.2%

    China’s retail sales over the Spring Festival holiday rose 11.2 percent from the same vacation period a year earlier, with cinemas posting sharp increases in box-office sales, the country’s Ministry of Commerce said in a statement Saturday.

    Retail sales and restaurant receipts in the world’s second-largest economy totaled about 754 billion yuan ($115 billion) in the week-long holiday period that started Feb. 7, the eve of the Lunar New Year, according to the statement. This year’s growth was similar to the 11 percent increase posted in last year’s holiday period.

    Services for the first time generated more than half of China’s gross domestic product last year, at 50.5 percent. Higher household incomes allow families to embrace a middle-class life as the country’s leaders continue to engineer a shift toward services and consumption, and away from manufacturing and investment. Services generate more jobs per yuan of output than China’s factories, which is crucial as the country adjusts to a slower economic growth rate.

    Box-office sales at China’s cinemas over the first three days of the Lunar New Year surged about 80 percent from a year earlier, to nearly 1.7 billion yuan, the statement said. Total ticket sales over the first three days of this year’s Lunar New Year almost equaled the total for the whole week-long holiday last year, according to the statement.

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  • China’s trade slumps in January

    China’s trade slumps in January

    China’s trade slumped in January due to weak global demand and holiday effects, casting new shadow over the outlook of the world’s second-largest economy, data from the General Administration of Customs showed yesterday.

    Exports shrank 6.6 percent from a year earlier to 1.14 trillion yuan (US$174.6 billion) in January, ending a one-month-long growth stream of 2.3 percent in December. Imports contracted 14.4 percent to 737.5 billion yuan, much widening from the loss of 4 percent a month earlier.

    As a result, January’s trade surplus shot to 406.2 billion yuan, a record high that was up 12.2 percent year on year and more than December’s surplus of 382.1 billion yuan.

    “China’s exports fell sharply, suggesting weak global demand,” said Liu Ligang, chief economist at Australia & New Zealand Banking Group. “The decrease of imports was in part due to still low commodity prices.”

    Liu noted the earlier timing of the Chinese New Year in 2016 compared with 2015 has also distorted the annual growth rates as traders tended to frontload their shipments in December when exports staged a remarkable rebound.

    Wendy Chen, a research analyst at Nomura, said the trade data, together with other indicators, suggested growth momentum in China weakened further in January.

    “As China’s retail sales remained stable, the trade slump mainly reflected weakening investment demand, possibly from weaker property investment and measures to reduce overcapacity,” Chen said.

    China’s economy had a “bumpy start” this year as data for January stayed weak due to the holiday effects and the extremely cold weather. Factories continued to report contracted activities while service providers also saw their business less robust.

    China’s growth momentum has kept slowing as the country entered the state of “new normal,” illustrated by moderating growth rate but better growth quality.

    China’s gross domestic product grew 6.8 percent in the fourth quarter of last year, and ended 2015 with a rate of 6.9 percent, the slowest annual expansion in a quarter of a century.

    In January, China’s trade decreased 9.8 percent to 1.88 trillion yuan, the Customs data showed. It deteriorated further from last year’s contraction of 7 percent, when China missed its government target of a 6-percent increase.

    The European Union remained China’s largest trading partner last month, although its trade with China declined 9.9 percent to 290.3 billion yuan. It was followed by the United States and the ASEAN countries, which shipped goods worth 269.8 billion yuan and 234.2 billion yuan respectively, down 9.9 percent and 10.8 percent.

    Foreign trade involving China’s private firms delivered the best performance by increasing 1.1 percent during the period, while foreign traders said their business lost 14.3percent and state-owned traders reported a contraction of 21.9 percent.

    Shanghai’s trade retreated 6.1 percent to 219.4 billion yuan last month.

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  • Indonesia’s Garuda to Choose Between A350 and 787 This Year

    Indonesia’s Garuda to Choose Between A350 and 787 This Year

    Garuda Indonesia Persero PT expects to decide between Airbus Group SE’s A350 and Boeing Co.’s 787 models this year as it prepares to order at least 20 of the large aircraft, the airline’s president director said.

    The Indonesian flag carrier forecasts growth to pick up significantly in 2019 and will need the new planes to handle expected capacity, Arif Wibowo said Wednesday at the Singapore Airshow. The airline has no plan to use Airbus’s A380 superjumbo, he told Bloomberg TV earlier in the day.

    Garuda returned to profitability last year with net income of $76.5 million, compared to a $370 million loss the year before, according to data compiled by Bloomberg. Still, its shares tumbled 44 percent in 2015, nearly four times as much as the 12 percent decline in the benchmark Jakarta Composite Index and far below the 19 percent gain in the Bloomberg Asia Pacific Airlines Index.

    Shares were down 2.4 percent Wednesday at 449 rupiah as of 10:14 a.m. in Jakarta. The stock is trading near eight-month highs and has risen 45 percent so far this year, making it the seventh-best performer on the local index.

    Trimming Hedges

    The company expects oil prices to remain low and is reducing its fuel hedges, Wibowo said. The carrier forecasts passenger numbers to rise 10 percent this year and is seeking to capture 50 percent of the domestic market, up from 44 percent currently, he told reporters earlier this month.

    If the U.S. Federal Aviation Administration upgrades Indonesia’s safety rating to Category 1, Garuda hopes to launch non-stop service to the U.S. West Coast, giving it an advantage over competitors who make the trip with one stop, Wibowo said. He said the FAA is currently evaluating Garuda itself, with the results due out in the second half of the year.

    The carrier also hopes to start non-stop service to London but is limited by the runways at Jakarta’s international airport, which Wibowo said can not yet handle a fully loaded 777.

    Garuda plans to have a two-class cabin configuration on planes serving the Middle East, Southeast Asia and North Asia, with a similar configuration on any new planes they order, Wibowo said. Only four of the carrier’s 777s, used on flights to Amsterdam and London, will offer first-class seating, he said.

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  • China’s Monkey Week Boost Demand as Retail Sales Increased

    China’s Monkey Week Boost Demand as Retail Sales Increased

    The gloomy Chinese economy has shown a sign of stabilization during “Monkey,” the lunar New Year celebrations as retail sales have surged, suggesting an improvement in domestic demand.

    During spring festival last week, China’s retail sales recorded 11.2% year-over-year (YoY) growth, fueled by cinemas, according to the Chinese Ministry of Commerce on Saturday. The retail and restaurant sales surged to $115 billion (754 billion yuan), showing a strong potential of the food industry in the world’s most-populated country.

    The Chinese economy last year grew 6.9%, slowest GDP growth rate since 1990, owing to the soft domestic demand in the country. The Chinese authority to uplift domestic demand undertook several measures. Despite the initiatives by Beijing, the Chinese economy is still on a bumpy ride as depicted by recent gloomy economic indicators.

    However, the jump in retail sales during spring festival last week depicts that policymaker’s efforts have started paying off. From January, the People’s Bank of China (PBOC) performed massive open market operations to keep the market liquid. In January, it injected net liquidity worth about $188 billion (1.235 trillion yuan), to meet the cash demand during spring festival.

    The massive liquidity injections raised concerns among economists, who believe that this week would lead to tightening liquidity as the Chinese central bank has to mop liquidity from the economy. They also believe that increase in retail sales during the spring festival, which started on February 8-13, suggesting demand is picking up pace.

    Food demand remained strong during celebrations and medium-sized food retailers saw 10.6% YoY growth as Chinese families preferred to eat food from restaurants. Tourism also recorded modest demand during week-long holidays and nearly 1.62 million foreign tourists visited China in a week-long holiday. Mass catering services also posted record boom as Chinese families hosted reunion dinners.

    Analysts believe that the modest growth in demand shows the potential of Chinese consumers. However, they believe that the demand is seasonal and Beijing needs to devise an effective strategy to spur and sustain domestic demand in an attempt to streamline the world’s second largest economy.

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