Retail News CRM

Tag: China

  • Online retailer Ymatou expects huge Black Friday sales

    Online retailer Ymatou expects huge Black Friday sales

    Jia Yi, a white-collar employee from Chengdu, the capital city of Sichuan province is passionate about overseas brands and products. She is now considering buying a Coach handbag on the upcoming Black Friday shopping event.

    “The price in the domestic market could reach more than 2,000 yuan ($290), but it is just 848 yuan on the e-commerce platform during Black Friday. It is very cost-effective and I am prepared to buy one,” said Jia.

    China’s cross-border e-commerce has been growing over the past few years. The Shanghai-based cross-border e-commerce site ymatou.com expects the scale of the Black Friday event this year to be 10 times over last year by hiring more than 30,000 overseas buyers.

    The company, which has participated in the biggest retail sales day of the year since 2014, said customers could buy more than 600,000 imported goods from 83 countries, including discounted clothes, shoes, bags, cosmetics, fine jewelry and health care products without leaving the house.

    “There is a trend that consumers from second- and third-tier cities are more willing to buy overseas products. Chinese consumers’ demands have been upgraded as they have diversified and personalized requirements for products and services,” said Zeng Bibo, chief executive officer of Ymatou.

    Zeng added they prefer to buy niche brands from European designers than the mass-market brands in America.

    Black Friday, the day following Thanksgiving Day in the United States, is a busy shopping day with the highest discounts of the year and a major impact on brick-and-mortar retailers, e-commerce players and consumers around the world.

    Ymatou said it is set to ensure that Chinese online shoppers can get the same deals that their Western counterparts enjoy during Black Friday. Buyers can broadcast their shopping process at the online shopping platforms.

    It continues to increase investment in the access threshold of buyers to ensure the authenticity of the goods’ sources. Zeng said they will check the credit status of buyers from time to time, requiring them to offer credentials for long-term living overseas and identifications.

    Furthermore, Ymatou has established an independent logistics company, XLobo, to develop overseas direct mail business.

    XLobo collects and bundles individual parcels at overseas locations and ships them to China as a single consignment. It now owns 15 international logistics centers around the world to ensure the period of direct mail within five days, on average.

    “The number of professional logistics service staff has been doubled. We have expanded the space of warehouses in New York, San Francisco and Osaka, and the investment in equipment and logistics this year has surpassed the total input of last year,” said Zeng.

    It arranges over 90 chartered airplanes each week to transport the goods and other airlines that have cooperative relations with Ymatou will reserve shipping space for XLobo in advance.

    Chinese e-commerce companies, such as Alibaba Group Holdings and JD.com Inc have developed their own cross-border e-commerce businesses.

    Statistics from the China E-Commerce Research Center show that China’s cross-border e-commerce transactions totaled 5.4 trillion yuan ($783 billion) last year, a year-on-year increase of 28.6 percent.

    The generation aged between 20 and 35 old is the major force of cross-border shopping, experts said.

    Cao Lei, director of the China E-Commerce Research Center, said customers need to choose an excellent cross-border e-commerce platform, pay attention to sellers’ reputations or ranking level and customers’ comments, adding they should choose a platform that owns and operates its logistics system.

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  • AirAsia launches daily Manila-Taipei service

    AirAsia launches daily Manila-Taipei service

    Travellers from the Philippines now have more options when flying to Taiwan after Philippines AirAsia started its daily Manila-Taipei service last Monday.

    Philippines AirAsia chief executive Captain Dexter Comendador himself piloted the Airbus A320 to mark the budget airline’s maiden voyage from Manila to Taipei.

    “Today heralds a brighter and much closer ties between two countries to improve trade and tourism,” he addressed the passengers midway through the flight.

    “We have introduced amazing connections for our guests to enjoy and we are aiming to go further across Asia by strengthening AirAsia’s presence in Taiwan,” Comendador added.

    The flight touched down at the Taoyuan International Airport after midnight to a welcome water barrage from firetrucks.

    The Taipei-Manila route was officially launched Tuesday at a press conference at the Grand Sheraton in Taipei, which was attended by Philippines AirAsia chair Maan Hontiveros and AirAsia North Asia CEO Kathleen Tan.

    A thrice-weekly Cebu-Taipei service was also announced with performances from Sinulog dancers. Taiwanese celebrity travel blogger Patty Woo also regaled guests with her beach adventures during her recent trip to Cebu.

    Starting Friday, Philippines AirAsia will begin regular flights from Cebu to Taipei on Wednesday, Friday and Sunday.

    Taiwanese tourist arrivals in the Philippines have reached 157,517 from January to August this year. Taiwan is currently the country’s sixth top visitor market after Korea, the United States, China, Japan and Australia.

    “Taiwan and the Philippines share a strong affinity with one another. They enjoy robust economic ties, many Filipinos live and work in Taiwan and more and more Taiwanese are visiting the many beautiful islands in the Philippines. We are honored to be able to bring the countries even closer together,” Tan said.

    Taiwan is known for night markets, tourist attractions like Taipei 101, and foodie adventures with its diverse culinary offerings

    Philippines AirAsia has teamed up with TourMeAway Walking Tours to make exploring Taipei more fun. From now until November 30, Philippines AirAsia travelers to Taipei may join the Hunger Game Walking Tour or the Taipei Chillout Tour for free.

  • Isetan Mitsukoshi launching online store

    Isetan Mitsukoshi launching online store

    As part of its aim to have digital strategy as the core of its business, Japanese department store company Isetan Mitsukoshi Holdings is preparing to launch an online store.

    It has started tests leading up to its launch this month of its first online store on Alibaba Group Holding’s Tmall Global.

    In the first half of this year, Isetan Mitsukoshi saw sales of duty-free items rise about 3.7 times compared with the same period in 2013. It says Chinese customers account for about 70 per cent of duty-free sales, and are interested in Japanese products that are popular in Japan. This has led to it seeking to develop a following in China through its strategic partnership with Tmall Global.

    It will offer safe, high-quality products, mainly Japanese, on Tmall Global; form an alliance between its Chinese and Japanese stores; and accumulate know-how on marketing in China.

    Isetan Mitsukoshi will initially offer hundreds of types of products on the platform ranging from fashion and cosmetics to foodstuffs and daily necessities, with plans to subsequently expand the scope of ifs offering.

    It will focus on its own brands and seasonal products, and gradually add other Japanese brands. From next year it will stage special campaigns in collaboration with designers.

    There will also be after-sale services, including repairs, as well as pop-up stores through its network in China.

    Alibaba Group, which runs Tmall – China’s largest B2C online shopping mall – and other eCommerce portals, had 434 million active users on China’s retail market as of June.

    Isetan Mitsukoshi was formed in 2008 by merging Mitsukoshi and Isetan, originally inaugurated in 1673 and 1886 respectively as kimono shops. It runs Japan’s largest department store network with 27 outlets in Japan and 31 overseas.

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  • China Telecom Shanghai, Huawei test network slicing

    China Telecom Shanghai, Huawei test network slicing

    China Telecom Shanghai and Huawei have successfully jointly implemented access network slicing at a trial site.

    The trial solution involves slicing the access network into home, enterprise and campus connections, which will potentially allow the operator to use a single network to deliver all types of services.

    OLT hardware is shared by services, and all segments are isolated from each other in order to improve service reliability and network security.

    China Telecom Shanghai engaged Huawei to develop an access network slicing solution to address issues including insufficient equipment room space and runaway power consumption associated with rapid user base growth.

    “Traditional OLTs do not support the access of full services. Network slicing enables service isolation and optimizes resource utilization,” China Telecom Shanghai vice chief engineer Zhang Jun said.

    “Network slicing is our first step toward cloud. It is now being including in the related technical standards of China Telecom. In the future, we will cooperate with Huawei to further optimize network slicing.”

    The companies expect that network slicing will propel the development of gigabit networks. This will be essential to helping operators meet the enormous capacity demands of the cloud era.

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  • Alibaba Cloud to open new data centers

    Alibaba Cloud to open new data centers

    Alibaba Cloud has announced plans to open four new data centers by the end of 2016 in the Middle East, Europe, Australia and Japan.

    The new centers are expected to boost its data center network to 14 locations, covering key economic centers around the world. The data center in the Middle East, located in Dubai in the United Arab Emirates, commenced initial operations today.

    Alibaba Cloud’s expansion aims to provide customers in Asia and worldwide with improved latency and greater access to diverse offerings, including data storage and analytics services, enterprise-level middleware, and cloud security services. The new data centers are expected to support Alibaba Cloud’s growing client base beyond the current 2.3 million.

    Extending its global footprint in the Asia-Pacific, Alibaba Cloud will open a new data center in Sydney, Australia by the end of 2016.

    Alibaba Cloud will bring its most popular cloud services in data storage and processing services, enterprise-level middleware, and cloud security services to the Australian market. A dedicated team will be based in Australia, and build up a cloud ecosystem with local technology partners to drive cloud and big-data business in the region.

    The planned new Japan Data Center, hosted by SB Cloud Corporation, a joint venture between Softbank and Alibaba Group, will meanwhile provide Japanese enterprises with public cloud computing services from Alibaba Cloud.

    With the joint venture, Alibaba Cloud will further expand its cloud computing service platform by leveraging SoftBank’s extensive enterprise customer base in Japan.

    “Alibaba Cloud has contributed significantly to China’s technology advancement, establishing critical commerce infrastructure to enable cross-border businesses, online marketplaces, payments, logistics, cloud computing and big data to work together seamlessly,” Alibaba Cloud president Simon Hu said.

    “We want to establish cloud computing as the digital foundation for the new global economy using the opportunities of cloud computing to empower businesses of all sizes across all markets.”

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  • Stores in China using apps to increase foot traffic

    Stores in China using apps to increase foot traffic

    A growing number of retail stores in China are using specially designed apps to track shoppers’ behavior in a bid to boost sales.

    Yo-ren, an information technology startup, has developed an app to collect information about members enrolled in reward programs offered by stores. Convenience store operator Lawson has introduced the app at select locations in China.

    The Chinese government has desire to make consumption the primary driver of growth. But spreading online shopping will bring the detriment on brick-and-mortar shops.

    Incentive programs

    In 2015, the Shanghai-based Yo-ren, which provides digital marketing services in China, began supplying Lawson stores in Shanghai with an app to manage the convenience store’s reward points program. Since the beginning of this year, the companies have expanded use of the app to other cities, including Beijing, Dalian and Wuhan.

    The app is designed to provide product information and discount coupons while giving customers reward points based on their purchases.

    Under the current plan, members earn 10 points for each yuan they spend, exchangeable for store coupons, at the rate of 1,000 points for 1 yuan (15 cents).

    Since the service was rolled out, the number of members in Shanghai increased to 350,000. About 15% of them use the app at least once a week. These active users visit Lawson stores three times per week on average.

    Lawson has invested around $900,000 in Yo-ren, which is now using the money to enhance the app’s features.

    Tailored services

    Lawson plans to analyze information collected through the app, such as customer profiles and purchase records, for consumer preferences and trends. Findings will then be used to boost traffic during slow business hours, such as by offering coupons for free cups of coffee between 3 p.m. and 5 p.m. at locations close to members’ workplaces.

    Chinese consumers are flocking to internet shopping services provided by Alibaba Group Holding and other e-commerce players. Soaring online purchases are denting earnings at brick-and-mortar retailers, especially department stores.

    Convenience stores have proved less vulnerable to the trend, but Yo-ren CEO Osamu Kaneda said there is still a lot of room for them to boost their ability to attract consumers.

    Yo-ren’s app allows stores to track members in real time. Its features enable stores to analyze customer preferences and then develop new revenue streams from makers through targeted advertising. The app will also help stores tailor their services to match customers’ needs.

    China is in the midst of an economic evolution in which consumer spending is replacing investment and exports as the main driver of economic growth. The service sector is an important link in this shift because it employs large numbers of people.

    But the decline of brick-and-mortar sales will inhibit consumption due to slower job creation in the service sector and lower wages for those jobs.

    To make consumer spending the new engine of economic growth, China needs to engineer a balance between online shopping and sales at traditional retail stores.

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  • Boycott China? Dragon now angel for Indian startups

    Boycott China? Dragon now angel for Indian startups

    ‘Boycott China’ messages may have become routine on WhatsApp in India. But in the startup world, India and China are drawing closer.

    Chinese firms and funds have become big investors in Indian startups , and they are becoming particularly useful now as US funds slow down. Beijing Miteno Communication Technology, a Chinese tech conglomerate, made this year’s biggest acquisition in the technology startup space — the $900 million buyout of Media.net, a subsidiary of Mumbai-based Directi, founded by brothers Bhavin and Divyank Turakhia.

    Ecommerce giant Alibaba has made large investments in Paytm and Snapdeal. Didi Chuxing, the equivalent of Uber in China, has invested in Ola. Internet giant Tencent recently led a $175 million funding in messaging app Hike; prior to that, it led a $90 million round in healthcare solutions firm Practo and, through its joint venture with South Africa’s Naspers, invested in online travel firm Ibibo Group.

    “There are demographic similarities and both countries are seeing consumer growth for digital firms. Also, Chinese players have experience in market creation and running successful digital companies, so they can play a bigger role than being just financial investors,” says Ashish Kashyap, founder of Ibibo, which last month merged with rival MakeMyTrip. Alibaba, for instance, is seen to be actively helping Paytm in various aspects.

    Bhavin Turakhia says the Chinese understand the Indian market better than US companies do as the Indian market is on the same evolution path as that of China, but about 5 to 10 years behind.

    Chinese companies and funds have become big investors in Indian startups . Cheetah Mobile, which owns products like Clean Master, invested in fitness app GOQii late last year.

    Ctrip, one of China’s largest online travel companies, invested $180 million in MakeMyTrip in January. China-based investment firm Hillhouse Capital has invested in CarDekho. Smartphone maker Xiaomi led a $25-million funding round in content provider Hungama Digital Media Entertainment in April.

    Web services company Baidu has said it is scouting for investment opportunities in Indian startups.

    Even other Asian companies are nowhere close to investing as much as the Chinese in Indian startups. Japan’s SoftBank and Singapore’s Temasek are among the few non-Chinese ones that have made investments. Taiwan’s Foxconn has also made several investments, like in Qikpod, Hike and Snapdeal, but some see Foxconn as practically a Chinese company, given that much of its operations is in China.

    What’s pushing the Chinese tech companies to make large investments are two things: one, many of them are making big profits in their home market, thanks partly to the restrictions on foreign competition; and two, the Chinese economy is slowing down.

    So they want to use their surpluses to expand into what is potentially the world’s third largest digital market.

    “There are only two big growing markets where they can invest: India and the United States. Silicon Valley does not respect Chinese capital. So the Indian tech sector becomes attractive to them,” says Mohan Kumar, executive director at Norwest Ventures, a US-based venture fund that has operations in India. Kumar also notes that Chinese investors often value Indian startups at three to five times more than what other seasoned investors do. “So entrepreneurs naturally prefer them,” he says.

    Higher valuations mean the Chinese investors take lower stakes for the same amount of investment, and founders can hope for an even higher valuation in their next round of fund raising.

    Language and politics are a challenge. May be for that reason, the Chinese are for now preferring partnerships and not outright buys. Even investment firms are building partnerships. Chinese VC fund Incapital has tied up with Indian fund IvyCap Ventures to enable its partner investors to have a closer look at potential investment opportunities in Indian startups.

    China is showing interest in traditional industries too. In July, Chinese pharma company Shanghai Fosun Pharmaceutical Co acquired Indian injectables manufacturer Gland Pharma for $1.27 billion, and in August, Chinese conglomerate Jiangsu Longzhe Technology and Trade Development Co acquired Diamond Power Infrastructure, Vadodara-based manufacturer of cables, conductors, transformers and other power sector equipment, for $125 million. But digital technology looks to be where the biggest action is.

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  • Alibaba investing in Sanjiang Shopping Club

    Alibaba investing in Sanjiang Shopping Club

    Chinese eCommerce giant Alibaba Group Holding plans to invest 2.1 billion yuan (US$305 million) in supermarket chain Sanjiang Shopping Club.

    Sanjiang’s share were suspended by the Shanghai stock exchange on November 8, with trading resuming today.

    Under the terms of the deal, according to stock-exchange filings, Alibaba will subscribe to a private placement in Sanjiang, giving it about a 25 per cent stake.

    Sanjiang also plans to issue up to 188 million yuan worth of exchangeable bonds to Alibaba, which will also acquire another 9.3 per cent stake for 438.6 million yuan via a share transfer, says Sanjiang. This will take Alibaba’s stake to 32 per cent, above the 30 per cent threshold where Chinese law says a company must make a full takeover bid in China. Alibaba will need approval from Sanjiang’s shareholders to waive this requirement.

    Sanjiang said it aims to use Alibaba’s eCommerce platform as China’s economic growth slows.

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  • Aldi poised to sell wine in China

    Aldi poised to sell wine in China

    The discounter has been rumoured to be mulling a launch in mainline China since 2014, when it was reported by the Guardian, however a report in German trade publication Lebensmittel Zeitung announcing the online-only move last week has been confirmed to the Australian media by Aldi.

    The Aldi spokesman said the discounter had been researching the market and undertaking feasibility studies for several years and was now ready to launch an e-commerce site in mainland China during the early part of 2017.

    “In the second quarter of 2017, Aldi will commence selling a carefully selected range of everyday grocery items to Chinese consumers,” a spokesman was reported as saying.

    The statement noted that Aldi had enjoyed a strong and long lasting relationships with many of its Australian suppliers since its first stores opened in 2001 and the Australian business had grown rapidly and would benefit from continued investment to expand. “Our growth across the country has provided increased business for these suppliers, allowing them to invest this back into their own operations and contributing to their success. We look forward to further expanding these relationships as we develop further opportunities in Asia,” it said. “We know there is a strong demand among Chinese consumers for Australian manufactured products and our goal is to provide a competitively priced alternative for shoppers seeking quality groceries. We believe our unique offer of high-quality Australian products at unbeatable prices will be an attractive proposition for Chinese consumers.”

    The move will use Aldi’s Australian retail business to supply China, and will concentrate on wine, and ambient groceries.

    There is huge demand for wine in China, and Australia has enjoyed a boom in sales to Chinese consumers. Last year, China overtook the US as Australia’s most valuable market, rising 51% to AUS$474 million during 2015, while last month, the China Association for Imports & Export of Wines & Spirits released figures showing the country imported more than 354 million litres of wines between January and September 2016 – an increase of 19.06% on the same period last year.

    Aldi launched its first UK e-commerce operation in January this year focusing on wine sales, and sold more 3,000 cases on its first day. The team said the it had continued to be  extremely popular, growing sales in key areas of the South of the UK and London, where there are currently fewer stores.

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  • FINE jewellery launches into travel retail in China

    FINE jewellery launches into travel retail in China

    The 130-piece Treasure Collection includes silver pendants and earrings with cubic zirconia, diamonds and pearls, with each piece presented in a transparent sealed box. Prices range from US$49 to US$499.

    F.I.N.E Managing Director Ari Johansson said: “Jewellery is the most profitable category per cubic centimetre in retail, and we’ve developed a unique brand and a range of jewellery that inspires the wearer.

    “We also created a product that travel retailers can stock and manage more efficiently. Our extensive experience in manufacturing, logistics and training is reflective in the way we innovate in this space, be it in the box, on the box or out of the box.”

    Johansson will address the conference and trade fair on ‘Three ways to improve jewellery sales in duty free’.

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  • Hong Kong’s Q3 economic momentum cools on China slowdown

    Hong Kong’s Q3 economic momentum cools on China slowdown

    Hong Kong’s economic growth slowed in the third quarter from the second as weak exports, sluggish retail sales and falling tourist arrivals took its toll on the former British colony.

    Though the government kept its full-year estimate for 2016 in the middle of its previous forecast range of between 1 and 2 percent, underlying momentum slowed from the June quarter.

    Looking ahead, the government expects growth to remain on a modest track in the near term due to a number of concerns, including the likely trend of rising interest rates in the United States and elevated geopolitical risks elsewhere.

    “There is a need to stay alert to these risks for their possible repercussions on the global financial and economic situation,” it said in a statement.

    The economy grew a seasonally-adjusted 0.6 percent in the third quarter, compared with a downwardly revised 1.5 percent in the June quarter. Economists surveyed by Reuters had predicted growth of 0.3 percent.

    From a year earlier, the economy expanded 1.9 percent in the third quarter compared with 1.7 percent in the previous quarter and economists’ expectations of 1.6 percent.

    A marked slowdown in exports and weaker growth in private consumption and government spending combined to push down GDP in the third quarter.

    Hong Kong’s services sector has also been in a prolonged slump with retail sales falling for the 19th straight month in September as a strong local currency crimped business activity and tourism.

    Slower economic growth could pile further pressure on Hong Kong leader Leung Chun-ying ahead of an election next year and amid rising tensions with the central government in China over concerns of increased meddling by Beijing in the city’s affairs.

    Hong Kong’s benchmark index closed down 1.4 percent before the data on Friday, capping a turbulent week in financial markets in the wake of Donald Trump’s surprise presidential win at the U.S. elections.

    The former British colony’s economy is now more vulnerable as it struggles with weaker retail sales and a slump in cash-rich mainland Chinese streaming across the border on shopping sprees.

    Prospects for Hong Kong could be further compounded by new U.S. trade policies and China’s economic performance at a time when exports are weak and economists are waiting to see the impact of property cooling measures imposed this month.

    The government said it would raise stamp duties on home purchases to 15 percent, across the board, effective Nov. 5.

    Some economists said the once vibrant city would continue to face pressure from global economic uncertainty as well as increasing tensions with Beijing that could threaten stability and impede policymaking.

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  • Frasers Centrepoint Trust buys retail podium of Yishun 10 Cinema Complex

    Frasers Centrepoint Trust buys retail podium of Yishun 10 Cinema Complex

    Frasers Centrepoint Trust has entered into two sale and purchase agreements for the acquisition of the retail podium of Yishu 10 Cinema Complex. The deal is worth $37.8m.

    One of which was with Goldvein Trading Pte. Ltd., for the acquisition of units #01-01, #01-02, #01-04/04A, #01-05, #01-06, #01-07, #01-08 and #01-09 of the retail podium of Yishun 10 Cinema Complex, 51 Yishun Central 1, Singapore 768794 at a consideration sum of S$25.9m

    The other was with Bon-Food Pte Ltd, for the acquisition of unit #01-03 of the Retail Podium at a consideration sum of S$11.8m.

    The acquisition is in line with the strategy of FCT of nvesting in quality income-producing properties used primarily for retail purposes.

    Goldvein Trading Pte. Ltd. and Bon-Food Pte Ltd are whollyowned Singapore subsidiaries of Bonvests Holdings Limited, a company listed on the Main Board of Singapore Exchange Securities Trading Limited.

    The Aggregate Consideration for the Acquisition was arrived at on a willing-buyer and willing-seller basis after taking into account the location, occupancy and rental income generated by the Retail Podium. The independent valuation as at 30 September 2016 of all 10 units of the Retail Podium by Jones Lang LaSalle Property Consultants Pte. Ltd., which was appointed by the Trustee, is S$40m and derived using the discounted cash flow approach and direct capitalisation approach.

    The Aggregate Consideration will be paid in cash to the Vendors on completion of the Acquisition, which is expected to be on 16 November 2016.

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  • Duck-Snack Maker Flounders with Weak IPO Pricing

    Duck-Snack Maker Flounders with Weak IPO Pricing

    One of the year’s quirkier IPOs had its wings clipped after investors’ appetites failed to take off for one of China’s leading makers of popular snack foods made from duck parts.

    After making a splash with its original listing announcement, Zhou Hei Ya International Holdings Co. Ltd. couldn’t impress investors even with a growth story that includes annual profit and revenue growth of more than 40% annually between 2013 and 2015.

    The offering in Hong Kong was ultimately priced at HK$5.88 (76 U.S. cents) per share, or near the bottom of its previously announced range of HK$5.80 to HK$7.80.

    Hong Kong retail investors, who normally flock to IPOs for famous brands, gave the offering an especially cold shoulder. Of the 42.4 million shares available for those mom-and-pop buyers, representing 10% of the total offering, only 81% were actually sold.

    That forced Zhou Hei Ya, whose name means “Zhou Family Black Duck,” to sell about 8 million orphaned shares from that portion of the allotment to institutional investors instead. Zhou Hei Ya raised HK$2.37 billion from the offering, far short of its original target of up to HK$3.3 billion.

    A big name in the domestic snack-food market, Zhou Hei Ya hopes to use the funds to expand internationally. Started in 2002 as a family-run snack stall in the interior city of Wuhan, Hubei province, the company’s products are now sold in 750 retail stores across 40 Chinese cities. In addition to its namesake duck necks, its products also include local delicacies like duck feet, braised peanuts and duck tongue.

    Braised snacks have a long history in China, where they are commonly sold at roadside stalls. But they are increasingly being marketed by major snack brands. Meat, tofu and other ingredients are simmered for hours in a rich savory broth, and many regions have their own special seasoning blends.

  • China approves 16 duty free arrivals shops

    China approves 16 duty free arrivals shops

    China’s Ministry of Finance has approved applications to open 16 duty free arrival shops in 10 international airports and at six land border crossing points, introducing limited competition to the nation’s growing duty free market for the first time.

    Four state-backed enterprises with existing duty free retail operations have qualified to bid for the 16 arrival shop licenses that are due to be awarded during the next six months.

    The four companies are: China Duty Free Group (CDFG), China National Service Corporation For Chinese Personnel Working Abroad (CNSC), Shenzhen Duty Free and Zhuhai Duty Free.

    “There is departure, arrival and downtown duty free shopping in China, now arrival shopping will be open to limited competition,” commented a source at one of the operating companies selected to bid for the licenses.

    CDFG AND CNSC HEAD TO HEAD…

    “The four companies are qualified to bid for all the duty free arrival shops. Probably Shenzhen Duty Free and Zhuhai Duty Free are not interested in operating nationally, but will bid for local arrival border shops, so the airport competition will be between CDFG and CNSC as they are the only two national operating companies.”

    The 10 airports approved to open duty free arrival shops include some of China’s top ten airports. The list does not include Beijing Capital International Airport, Shanghai Pudong International Airport and Shanghai Hongqiao International Airport, however, as these already offer duty free arrival shopping services under a special government dispensation issued in 2008 to assist in the preparation of tourist facilities for the Beijing 2012 Olympic Games.

    New airports selected to open duty free arrival shops are believed to include: Chengdu Shuangliu International Airport, Chongqing Jiangbei International Airport, Dalian Zhoushiuzi International Airport, Guangzhou Baiyun International Airport and Tianjin Binhai International Airport.

    Ministry of Finance regulations permit the arrival shops to sell perfume and cosmetics, liquor and tobacco, confectionery, fashion items, accessories and watches.

    MOSTLY L&T AND P&C

    “Airport authorities rely on duty free operators to arrange the merchandise categories,” the source remarked. “The airports will want to sell mostly liquor and tobacco, and perfume and cosmetics. Airports care more about the sales volumes as that’s where their revenue comes from.”

    The largest arrival shop application approved is understood to be Chongqing Airport’s plan to open a 500sq m arrival store while the smallest arrival outlet approved is Tianjin Airport’s 50sq m arrival shop.

    Most airports have applied to open one arrival shop, though several with sufficient arrival halls have received permission to open two arrival stores.

    Under Ministry of Finance regulations each of the 16 duty free arrival shop operator licenses awarded will be for 10 years. All the licenses are required to be tendered and awarded within six months of the date of the arrival shop application being approved.

    TENDERS UNDER PREPARATION

    While results of all the tenders will be registered with the Finance Ministry, China’s General Administration of Customs will be the controlling authority regarding arrival shop retail operations. Selected airport owners and land border crossing authorities are just starting to prepare their arrival shop tender specifications.

    The various licenses are expected to be awarded in March and April 2017 as all 16 applications were approved at the beginning of November.

    Constructing the arrival shops is expected to take about six months after each license is awarded. Consequently most of the new arrival shops are likely to begin trading around September and October 2017.

    SHENZHEN AND ZHUHAI FOR LAND BORDER SHOPS?

    Meanwhile, competition is likely to be fierce between CDFG and local operators Shenzhen Duty Free and Zhuhai Duty Free to win the land border arrival shop licenses as all the locations are busy crossing points.

    Five of the six land border arrival shop licenses are for crossings on Guangdong Province’s southern border – four of these are for crossing points on the Shenzhen-Hong Kong border and one on the Zhuhai-Macau border where Shenzhen Duty Free and Zhuhai Duty Free operate departure duty free shops.

    The other land border arrival shop license is for Heihe in northern China on the border with Russia where CDFG operates a large departure duty free shop.

    The opening of border arrival shops in southern Guangdong also could have important implications for retailers in Hong Kong and Macau who will soon be competing with China’s new arrival border shops for mainland tourists’ custom.

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  • Tencent revenues up 13pc

    Tencent revenues up 13pc

    Third-quarter revenues grew by 13 per cent to RMB40.388 billion (US$5.951 billion) for China’s Tencent Holdings, an investment holding company whose subsidiaries provide media, entertainment, internet and mobile-phone value-added services, and online advertising.

    Tencent revenues from value-added services business increased by 9 per cent to RMB27.975 billion for the quarter, while revenues from online games revenues rose by 6 per cent to RMB18.166 billion, mainly driven by positive seasonality for PC online games and by continued contributions from new smartphone games.

    Social networks revenues went up by 15 per cent to RMB9.809 billion, reflecting growth from digital content subscription services, and to a lesser extent from virtual item sales.

    Revenues from online advertising increased by 14 per cent to RMB7.449 billion, performance-based advertising revenues grew by 18 per cent to RMB4.368 billion, and brand display advertising revenues increased by 9 per cent to RMB3.081 billion, primarily driven by higher contributions from mobile platforms such as Tencent News and the positive impact of the Rio Olympic Games.

    Profit attributable to equity holders of the company eased by 1 per cent to RMB10.646 billion for the quarter.

    Strategy continues

    Tencent Holdings continued its “Connection” strategy during the quarter by strengthening its social platforms and leveraging social traffic. More interactive social and performance advertising formats were added to drive user engagement, while advertiser tools were sharpened to improve performance measurement and deliver deeper data insight.

    For digital content, the company’s CMC (China Music Corporation) and QQ Music management teams were integrated, and there was “aggressive” investment in content for its video platform, resulting in a substantial growth in subscriptions. Partly because of a healthier copyright control environment, more users paid for content on the company’s digital literature platform.

    For payment-related services, the company says it made significant progress in driving merchant adoption. Nearly 700,000 merchants participated in its Weixin Pay “Cash-free Day” promotion in August – an increase of more than seven times year-on-year. A Weixin Checkout feature was introduced for merchants to simplify onboarding procedures and minimise payment integration work.

    Cloud services revenue more than tripled year-on-year as more enterprise accounts were opened and use by key accounts increased, particularly in sectors such as online games, online video and O2O services.

    During the year the company strengthened its mobile security in such areas as virus scanning, phony base-station detection, anti-fraudulent phone-number library, phone memory optimisation and speed boosting.

    More users

    For its key platforms, the company says monthly active users (MAU) for QQ increased by 1 per cent to 647 million, with new features including SMshow, offering animated personal avatars.

    During the Rio Olympics, more than 100 million QQ users participated in a virtual torch relay campaign by building augmented reality into phone-to-phone interactions.

    For Qzone, smart-device MAU also grew by 1 per cent, to 584 million. For WeChat and Weixin together, MAU reached 846 million, representing year-on-year growth of 30 per cent.

    Revenue growth was strong for the company’s social networks business through more game-related virtual items being generated, plus digital content sales.

    There was an 87 per cent leap in revenue from smartphone games, to about RMB9.9 billion. This was mainly driven by portfolio expansion and strong performance by major titles. At the end of September, Honour of Kings surpassed  a record 40 million daily active users.

    Advertising saw robust expansion, with Weixin and the mobile news app being the key contributors to year-on-year growth. Initiatives featuring the Rio Olympics attracted about 700 million unique visitors across the news and video platforms.

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