Company watching economic trend closely before proceeding with expansion plans
Boonthavorn, like its retail customers, has grown cautious about spending billions of baht on building up its chain of speciality stores for construction materials and home improvement products, despite the upturn in the economy.
"Although the economy overall shows signs of recovery, we need time to be sure in which direction to go," Sitthisak Tayanuwat, commercial vice president for Boonthavorn Ceramic, said yesterday.
The company is considering whether to speed up or put on hold its expansion plan to cover all the big cities upcountry such as Chiang Mai, Phuket and Hua Hin. Its provincial sales account for only 20 per cent of its total sales. A brokerage source said Boonthavorn had planned to raise funds from the public, but there has been no movement for a while.
Instead, Boonthavorn has opted to widen its market into a younger segment by refreshing its brand and renovating its six showrooms with a five-year budget of more than Bt1 billion. This is considered its biggest overhaul in 30 years of doing business.
The six Boonthavorns are located in the Ratchada, Rangsit, Pinklao, Suvarnabhumi and Thon Buri-Pakthor areas of greater Bangkok and in the beach resort city of Pattaya.
Construction on the new Kaset-Navamin branch in Bangkok with total retail space of 40,000 square metres is already 75 per cent complete. When it opens next quarter it will also display furniture and lighting.
"Changes in people's lifestyles such as the way they think or make buying decisions led us to refresh our Boonthavorn brand and showrooms to expand our target group to youngsters, who just graduated or started working, aged down to 25 years," Sitthisak said.
"Up to the present, our target group was concentrated on middle-age customers who are more than 35."
Customer buying behaviour is proactive, as shoppers come to Boonthavorn for the purpose of buying something. But over the past six to 10 years, what the new generations want are convenience and value for their money, he said.
Major products carried by Boonthavorn stores are wall and tile ceramics, kitchenware, sanitary ware, paints, lighting, tools and hardware.
Boonthavorn offers strong brands and a wide variety with 80,000 items from its suppliers and 30,000 patterns of ceramics. But, its name does not register with youngsters, he said.
Boonthavorn's customers come in four categories - retail, regular, deep pocket and project. The company's sales were most hit by project customers since fewer real estate developments were started.
Retail represents 25 per cent of total sales. This group was affected only slightly by the economic crisis, but individual customers are more cautious than before.
The regular group, consisting of professionals such as architects, contractors and designers, has experienced a drop in home-building work. The company tries to retain this group by launching a CRM programme for two years.
Recently, Boonthavorn opened a Builder Contractor and Designer Club, which now has 100,000 members, at its Ratchada showroom for architects and home-building specialists to use as a library or centre for meeting with their clients.
The deep-pocket customers, who normally spend a large sum per bill, have largely escaped the economic contraction.
This year the company has spent Bt200 million-Bt300 million on improving its product variety.
Boonthavorn's workforce numbers 2,000 and has never been reduced since the wake of the economic crisis of 1997.
The company recently lowered its sales target for this year to Bt7.5 billion from Bt8 billion set earlier. It booked Bt7.3 billion in sales last year.
Monday, August 31, 2009
TESCO Lotus launches Clubcard
The world's favourite customer rewards scheme comes to Thailand
Heralding a major change in the way in which Tesco Lotus does business in Thailand, Tesco Lotus Thailand has introduced the famous Clubcard to Thailand with an initial target to have 4 million members within the first year.
With over 21 million members world-wide clubcard is one of the most successful loyalty schemes in the world. Thailand now becomes the 7th country to launch the card nationally.
"Our customers choose to spend their hard-earned money with us because of our consistently low prices, good quality, range and shopping experience," says Steve hammett, Tesco Lotus CEO, adding that: "Clusbeard is our way of thanking them and rewarding them for their loyalty with better rewards than you will find practically anywhere else."
Clubcard members earn points as tey spend. The card also returns cash to customers ever quarter annd gives additional rewards on the products customers want.
"It is also an excellent opportunity for us to customise our products and services to frit the needs of our customers," he adds. "And as clubcard evolves so will their shopping experience."
Easy to join, abundant benefits
Clubcard is free to join and anyone who is 15 years and above may apply. Signing up for Clubcard is easy. with a simple application form available in all Tesco stores, customers will be issued a Clubcard and key fob on the spot allowing them to start collecting Clubcard Points right away.
For every two baht spent in Tesco Lotus Hyper, Value, Talad and Express, clubcard members will collect one Clubcard Point.
Clubcard Points never expire and four times a year all Clubcard points will be converted into Clubcard Cash Vouchers to help customers to save when they shop in Tesco Lotus. Cash Vouchers will be sent by mail to the customers's home.
In addition to the money saving Clubcard Cashh Vouchers, money-off product coupons are also included to help customers save on their favourite products purchased in Tesco. Timing of these mailings will be at relevant festive periods helping customers save money when they need it most.
We know what you like!
Having already enjoyed an overshelming response from being piloted in Had Yai and Samui stores over the past few years, Tesco Lotus Thailand is confident of nationwide success.
"Since the launch of the first Clubcard in the UK 14 years ago, not only have Clubcard benefits to customers improved, but our ability to understand customer needs and preferences have become increasingly more sophisticuated," says Gwyn Sundhagul, Director and Chief marketing Executive Officer.
"Today, it's part of our core purpose to continuously create more value for our customers and, in Thailand, will be our key long-term communication channel. When we say "no-one tries harder for customers, Clubcard is working proof."
Clubcard is available free of charge at over 600 Customer Service counters at Tesco Lotus stores nationwide. For more information, please contact customer service at all branches or call Tesco Lotus Clubcard Call Center at 02 626 8800.
Heralding a major change in the way in which Tesco Lotus does business in Thailand, Tesco Lotus Thailand has introduced the famous Clubcard to Thailand with an initial target to have 4 million members within the first year.
With over 21 million members world-wide clubcard is one of the most successful loyalty schemes in the world. Thailand now becomes the 7th country to launch the card nationally.
"Our customers choose to spend their hard-earned money with us because of our consistently low prices, good quality, range and shopping experience," says Steve hammett, Tesco Lotus CEO, adding that: "Clusbeard is our way of thanking them and rewarding them for their loyalty with better rewards than you will find practically anywhere else."
Clubcard members earn points as tey spend. The card also returns cash to customers ever quarter annd gives additional rewards on the products customers want.
"It is also an excellent opportunity for us to customise our products and services to frit the needs of our customers," he adds. "And as clubcard evolves so will their shopping experience."
Easy to join, abundant benefits
Clubcard is free to join and anyone who is 15 years and above may apply. Signing up for Clubcard is easy. with a simple application form available in all Tesco stores, customers will be issued a Clubcard and key fob on the spot allowing them to start collecting Clubcard Points right away.
For every two baht spent in Tesco Lotus Hyper, Value, Talad and Express, clubcard members will collect one Clubcard Point.
Clubcard Points never expire and four times a year all Clubcard points will be converted into Clubcard Cash Vouchers to help customers to save when they shop in Tesco Lotus. Cash Vouchers will be sent by mail to the customers's home.
In addition to the money saving Clubcard Cashh Vouchers, money-off product coupons are also included to help customers save on their favourite products purchased in Tesco. Timing of these mailings will be at relevant festive periods helping customers save money when they need it most.
We know what you like!
Having already enjoyed an overshelming response from being piloted in Had Yai and Samui stores over the past few years, Tesco Lotus Thailand is confident of nationwide success.
"Since the launch of the first Clubcard in the UK 14 years ago, not only have Clubcard benefits to customers improved, but our ability to understand customer needs and preferences have become increasingly more sophisticuated," says Gwyn Sundhagul, Director and Chief marketing Executive Officer.
"Today, it's part of our core purpose to continuously create more value for our customers and, in Thailand, will be our key long-term communication channel. When we say "no-one tries harder for customers, Clubcard is working proof."
Clubcard is available free of charge at over 600 Customer Service counters at Tesco Lotus stores nationwide. For more information, please contact customer service at all branches or call Tesco Lotus Clubcard Call Center at 02 626 8800.
Friday, August 28, 2009
CARREFOUR SINKS INTO RED AS SHOPPERS START TO SAVE
French supermarket giant Carrefour, ranked world No 2, yesterday said it had slipped into the red for t he first half in difficult times but still confirmed its 2009 earning targets.
The company, second only to Wal-Mart of the US, posted a net loss of 58 million euros(Bt2.8 billion)in the six months to June after taking exceptional charges of Euro511 million.
Operating profit fell 27.6 per cent from a year earlier to Euro1.01 billion.
The results reflect both a difficult environment and the company's strategic choices as it positions itself going ahead, said finance director Pierre Bouchut.
If the exceptional charges were stripped out, net earning were down 42.4 per cent to Euro415 million, Carrefour said.
Analyst forecasts had been for a net profit of around Euro100 million euros after exceptional charges of Euro550 million.
Carrefour said it still expected a 2009 operating profit before exceptional items of Euro2.7 billion to Euro2.8 billion if current trends and sales continued.
It also confirmed its target to secure cost saving of Euro4.5 billion by 2012, with Euro212 million achieved in the first half this year.
Carrefour said sales had held up well in the six months, with revenue down 1.6 per cent from a year earlier but up 1.9 per cent if fuel, exchange effects and seasonal-adjustments were taken into account.
"We are a good way towards achieving our 2009 objectives, towards carrying out our transformation plan," Carrefour head Lars Olofsson said.
The company, second only to Wal-Mart of the US, posted a net loss of 58 million euros(Bt2.8 billion)in the six months to June after taking exceptional charges of Euro511 million.
Operating profit fell 27.6 per cent from a year earlier to Euro1.01 billion.
The results reflect both a difficult environment and the company's strategic choices as it positions itself going ahead, said finance director Pierre Bouchut.
If the exceptional charges were stripped out, net earning were down 42.4 per cent to Euro415 million, Carrefour said.
Analyst forecasts had been for a net profit of around Euro100 million euros after exceptional charges of Euro550 million.
Carrefour said it still expected a 2009 operating profit before exceptional items of Euro2.7 billion to Euro2.8 billion if current trends and sales continued.
It also confirmed its target to secure cost saving of Euro4.5 billion by 2012, with Euro212 million achieved in the first half this year.
Carrefour said sales had held up well in the six months, with revenue down 1.6 per cent from a year earlier but up 1.9 per cent if fuel, exchange effects and seasonal-adjustments were taken into account.
"We are a good way towards achieving our 2009 objectives, towards carrying out our transformation plan," Carrefour head Lars Olofsson said.
Sam Chuk market honoured
Sam Chuk market and community received an Award of Merit at this year's Unesco Asia-Pacific Heritage Awards for Culture Heritage Conservation.
The Suphan Buri market was one of 48 places from 14 countries competing for the United Nations Educational, Scientific and Cultural Organisation award.
The top award went to the Sangiin Dalai Monastery in Mongolia, the UN agency said yesterday.
The merit award came as a surprise to the Sam Chuk community.
"We are honoured. We admitted that it was beyond our expectation to get the award," Pongwin Chaiwinat, chairman of the committee set up to revitalise the market, said.
Unesco did not give details on why it picked the market for the merit award.
The market and community, located on the bank of the Tha Chin, or Suphan Buri, River, was established as a trading post for the Central Region in 1894. The market was recently on course for collapse until local residents took action to revive it and transform the location into one of Suphan Buri's most popular tourist attractions.
The community at first did not intend to enter the competition, but decided to submit its project to Unesco after encouragement from conservationists and academics, Mr Pongwin said.
"Now we are proud of being internationally recognised," he said.
When a Tesco-Lotus supermarket was being built near the community, locals were worried the retail outlet would bring to an end the old market.
But Mr Pongwin said the superstore had little effect on the market."By the time Tesco-Lotus was completely built,the market already boomed," he said.
Its popularity also drew traders from other areas to the market, but the community leader said most of the vendors are Sam Chuk residents.
Sam Chuk market is the second old Thai community to be recognised by Unesco in the past two years. Last year Ban Amphawa in Samut Songkhram received an Honourable Mention for showing the success of private and public efforts to safeguard the cultural site.
The Suphan Buri market was one of 48 places from 14 countries competing for the United Nations Educational, Scientific and Cultural Organisation award.
The top award went to the Sangiin Dalai Monastery in Mongolia, the UN agency said yesterday.
The merit award came as a surprise to the Sam Chuk community.
"We are honoured. We admitted that it was beyond our expectation to get the award," Pongwin Chaiwinat, chairman of the committee set up to revitalise the market, said.
Unesco did not give details on why it picked the market for the merit award.
The market and community, located on the bank of the Tha Chin, or Suphan Buri, River, was established as a trading post for the Central Region in 1894. The market was recently on course for collapse until local residents took action to revive it and transform the location into one of Suphan Buri's most popular tourist attractions.
The community at first did not intend to enter the competition, but decided to submit its project to Unesco after encouragement from conservationists and academics, Mr Pongwin said.
"Now we are proud of being internationally recognised," he said.
When a Tesco-Lotus supermarket was being built near the community, locals were worried the retail outlet would bring to an end the old market.
But Mr Pongwin said the superstore had little effect on the market."By the time Tesco-Lotus was completely built,the market already boomed," he said.
Its popularity also drew traders from other areas to the market, but the community leader said most of the vendors are Sam Chuk residents.
Sam Chuk market is the second old Thai community to be recognised by Unesco in the past two years. Last year Ban Amphawa in Samut Songkhram received an Honourable Mention for showing the success of private and public efforts to safeguard the cultural site.
Thursday, August 27, 2009
CFR allocates B600m for Tops expansion
Central Food Retail Co, the operator of Tops Supermarket, will pour 600 million baht into business expansion next year.
President Ian Pye said that about 400 million baht will be spent on opening five Tops Supermarkets and Tops Markets, along with 40 new Tops Daily mini supermarkets, bringing the total to 173 next year. Another 200 million baht will be used to renovate its 17 existing stores.
The expansion will focus on the Tops Daily format after two years of market testing. CFR has 17 Tops Daily outlets nationwide, with the number set to rise to 25 by the year-end and 65 next year.
CFR currently has 117 supermarkets outlets nationwide, followed by Tesco with 55, Villa Market with 15, Jusco with nine and Home Fresh Mart with nine.
Mr Pye will retire as president of CFR at the end of this month. Alistair Taylor,a 46-year-old British executive, will succeed him on Sept 1.
"With 44 years of experience in a fantastic retail business, I may consider being a retail consultant as a new job,"said Mr Pye.
Mr Taylor joined CFR in December 2004. Previously he had worked with Sainsbury's in the UK, before moving to the retailer ParknShop in Hong Kong and China.
Mr Taylor plans to follow existing CFR policies but said he would focus more on the firm's speed.
"In this economic environment, the competition and business change all the time, so we have to prepare ourselves by focusing on speed for our new initiatives. We plan to be a market leader and not a follower," he said.
Sales of CFR in the first seven months of this year grew by 3%, compared to an earlier projection of 8% to 9%. Sales volume increased but value declined as consumers bought cheaper products.CFR is doing more marketing, including its Spot Rewards Card, to price-conscious shoppers amid high competition.
"I feel the country's economy has stopped declining," said Mr Pye.
The company expects its full-year sales will grow by 5% to 6% to 22 billion baht and hit 24 billion baht within next year,he added.
President Ian Pye said that about 400 million baht will be spent on opening five Tops Supermarkets and Tops Markets, along with 40 new Tops Daily mini supermarkets, bringing the total to 173 next year. Another 200 million baht will be used to renovate its 17 existing stores.
The expansion will focus on the Tops Daily format after two years of market testing. CFR has 17 Tops Daily outlets nationwide, with the number set to rise to 25 by the year-end and 65 next year.
CFR currently has 117 supermarkets outlets nationwide, followed by Tesco with 55, Villa Market with 15, Jusco with nine and Home Fresh Mart with nine.
Mr Pye will retire as president of CFR at the end of this month. Alistair Taylor,a 46-year-old British executive, will succeed him on Sept 1.
"With 44 years of experience in a fantastic retail business, I may consider being a retail consultant as a new job,"said Mr Pye.
Mr Taylor joined CFR in December 2004. Previously he had worked with Sainsbury's in the UK, before moving to the retailer ParknShop in Hong Kong and China.
Mr Taylor plans to follow existing CFR policies but said he would focus more on the firm's speed.
"In this economic environment, the competition and business change all the time, so we have to prepare ourselves by focusing on speed for our new initiatives. We plan to be a market leader and not a follower," he said.
Sales of CFR in the first seven months of this year grew by 3%, compared to an earlier projection of 8% to 9%. Sales volume increased but value declined as consumers bought cheaper products.CFR is doing more marketing, including its Spot Rewards Card, to price-conscious shoppers amid high competition.
"I feel the country's economy has stopped declining," said Mr Pye.
The company expects its full-year sales will grow by 5% to 6% to 22 billion baht and hit 24 billion baht within next year,he added.
MORE STORES, RENOVATION TO STAY IN FOCUS
A listair Taylor, the next president of Central Food Retail (CFR), said yesterday that he would keep the retail food business of Central Group growing through store expansion and renovation with Bt1 billion budgeted for this year and Bt600 million next year.
"It's very challenging to me to achieve our sales target [of 9 per cent from an estimated Bt22 billion this year to Bt24 billion next year]," he said.
Taylor, 46, will succeed Ian Pye, who is retiring on September 1 due to health problems. Taylor joined CFR in December 2004 and is now senior vice president for operations and business support.
Under CFR's business vision to move forward amid the intense competition, Pye planned to invest Bt1 billion in opening stores, renovating stores and improving IT tosupport merchandising and the SPOT reward card as one of the company's customer relations management programmes.
The expansion drive is still concentrated on four concepts to serve various customers' needs-Tops Market, Tops Super, Tops Daily and Central Food Hall.
"Our major move in the last quarter of this year is to renovate existing stores and expand new stores. We expect to have a total of 128 stores this year,[up from 106 stores last year]," he said.
CFR's market share has kept growing as it has been investing in expansion since 2004. The company is now considered the market leader in supermarkets and hypermarkets with a share of 806 per cent.
Its market share is expected to climb further to 10 cent this year.
The overall food retail market is worth Bt500 billion, of which 42 per cent is the modern trade and 58 per cent is traditional trade.
Major players include Tesco with 55 stores and Villa Market with 15.
CRF logged Bt20.2 billion in sales last year and expects to hit Bt 22 billion this year and Bt24 billion next year.
For the first seven months, sales grew by 3 per cent form the same period last year and are expected to grow by 5-7 per cent in the rest of this year. This will be short of its sales target set last year to grow by 8-9 per cent because customers traded down on produce, meaning higher sales volume but lower value.
But net profit fell in the first seven months as the company invested heaily in the CRM programme to retain its loyal customer base.
"We're growing faster than the industry. However, cash flow is more important than market share for the retail industry," Pye said. The company has cleared all its debts to zero since last September.
The company will focus on developing its house-brand products, from 450 items currently to 750 next year. It will also spend Bt400 million to build three Tops Markets, two Tops Supers and 40 Tops Daily's as well as Bt200 million to refresh its 17 existing stores.
Taylor said he would continue with the company's vision but make wsome adjustments i strategy.
Most of the new locations willuse the Tops Daily format, with 18 branches to be added in the rest of this year and 40 more next year.
This is because Tops Daily is easier to roll out than the other two larger concepts-Tops Super and Tops Market-as it requires only 300 square metres of retail space.
"It's very challenging to me to achieve our sales target [of 9 per cent from an estimated Bt22 billion this year to Bt24 billion next year]," he said.
Taylor, 46, will succeed Ian Pye, who is retiring on September 1 due to health problems. Taylor joined CFR in December 2004 and is now senior vice president for operations and business support.
Under CFR's business vision to move forward amid the intense competition, Pye planned to invest Bt1 billion in opening stores, renovating stores and improving IT tosupport merchandising and the SPOT reward card as one of the company's customer relations management programmes.
The expansion drive is still concentrated on four concepts to serve various customers' needs-Tops Market, Tops Super, Tops Daily and Central Food Hall.
"Our major move in the last quarter of this year is to renovate existing stores and expand new stores. We expect to have a total of 128 stores this year,[up from 106 stores last year]," he said.
CFR's market share has kept growing as it has been investing in expansion since 2004. The company is now considered the market leader in supermarkets and hypermarkets with a share of 806 per cent.
Its market share is expected to climb further to 10 cent this year.
The overall food retail market is worth Bt500 billion, of which 42 per cent is the modern trade and 58 per cent is traditional trade.
Major players include Tesco with 55 stores and Villa Market with 15.
CRF logged Bt20.2 billion in sales last year and expects to hit Bt 22 billion this year and Bt24 billion next year.
For the first seven months, sales grew by 3 per cent form the same period last year and are expected to grow by 5-7 per cent in the rest of this year. This will be short of its sales target set last year to grow by 8-9 per cent because customers traded down on produce, meaning higher sales volume but lower value.
But net profit fell in the first seven months as the company invested heaily in the CRM programme to retain its loyal customer base.
"We're growing faster than the industry. However, cash flow is more important than market share for the retail industry," Pye said. The company has cleared all its debts to zero since last September.
The company will focus on developing its house-brand products, from 450 items currently to 750 next year. It will also spend Bt400 million to build three Tops Markets, two Tops Supers and 40 Tops Daily's as well as Bt200 million to refresh its 17 existing stores.
Taylor said he would continue with the company's vision but make wsome adjustments i strategy.
Most of the new locations willuse the Tops Daily format, with 18 branches to be added in the rest of this year and 40 more next year.
This is because Tops Daily is easier to roll out than the other two larger concepts-Tops Super and Tops Market-as it requires only 300 square metres of retail space.
Tuesday, August 25, 2009
IT lifestyle centre opened in Siam Square
Trendy tech-savvy users coupled with advanced IT technologies are driving the newest digital lifestyle centre in Thailand. Meanwhile, however, the majority of consumers are sticking with traditional computer stores that offer more affordable products.
The potential growth of IT products among the digital generation was the key factor behind the newly opened 500-million-baht "Digital Gateway" at Center Point in Siam Square, said Soammaphat Traisorat, Executive Director of TCC Land, at the official launch.
Its location connected with the mass transit system is an important indication that the centre sees a bright future despite the current economic circumstances that may have a minor affect on tourists visiting in the centre.
Over the next three years the company plans to allocate one or two trolleys for IT lifestyle products in a project called "Gateway Ekamai" connected to Ekamai skytrain station.
Wallapa Traisorat, Executive Director,said that the 8,000-square-metre Digital Gateway combined digital technology,entertainment and learning for a new generation. It is also the first IT lifestyle centre in its group portfolio of computer centres which includes Pantip Plaza in Pratunam.
The building itself looks like a space tunnel which links the present with the future. The centre showcases the latest interactive media.
The centre has also partnered with Microsoft to become the first "Clean Mall"- an IT centre without any pirated software.
There are other IT flagship stores like iStudio, which is the second largest in Thailand, and the biggest True Lifestyle Shop. In addition, Oakley has also opened its second largest outlet in Asia.
Wisanu Wangwisut, Managing Director of Thippatana Arcade, the developer and property manager of Digital Gateway,a subsidiary of TCC Land Group, said that the centre's visitor profile ranged from 13 to 29-year olds, the dominant age group in Siam Square, and expected 100,000 visitors per day.
The company's expansion plan includes Pantip Plaza Bangkapi, a traditional computer centre which will open this September. It also intends to find other potential areas for computer centres such as Bang Yai district and Charoen Krung Road.
Accharas Ouysinprasert, Intel Microelectronics (Thailand) Country Manager,said the establishment of digital lifestyle centres and specialist stores showed how developed and mature the computer market here had become.
For trendy users in the centre, price is not main issue in making decisions but the users are more interested in styles and designs which reflect their personalities. For instance, the prices of notebooks with the same speed CPU may differ because of the other features they offer which serve a variety of consumer lifestyles. For example, Atom processor that can be used in normal netbooks or gadgets, and Asus HTPC keyboard with a five-inch small screen display with built-in HDMI port.
The recent consumer ultra-low voltage platform which helps to produce new ultra thin and light notebooks ranges from 20,000-80,000 baht depending on the material, design and other unique features.
From a design perspective shape, colour and materials, even in dustless key-boards or automotive power light safe display can attract experienced users or second-time buyers.
Pornthep Watchara-Amnouy, Managing Director of ASUSTek Computer,said that the company has to help its retail partners to select mid to high end notebooks and gadgets to fit in with the profile of the centre.
Chan Chaovanich, Managing Director of Speed Computer which has three brand shops in the centre, said because of higher rental costs from others, this is the first time that its big three suppliers - Asus, HP and Intel- have supported the space cost.
Meanwhile Ekachai Sirijirapatana,President of IT City, one of the largest IT superstores in Thailand, said that within the next three years, IT centres should have space of more than 10,000 square metres in order to support a variety of products for customer needs.
IT is a highly competitive market which has lowmargins ranging from 6-13 percent, so the volume of sales is important.If this sells in high cost rental area it means more premium products to sell even it has a greater margin, the volume will not cover the expenses.
"I think the upcountry areas, especially those with local department stores that still do not have IT shops and growing demand from consumer as well as low rental price more attractive," Ekachai said.
The potential growth of IT products among the digital generation was the key factor behind the newly opened 500-million-baht "Digital Gateway" at Center Point in Siam Square, said Soammaphat Traisorat, Executive Director of TCC Land, at the official launch.
Its location connected with the mass transit system is an important indication that the centre sees a bright future despite the current economic circumstances that may have a minor affect on tourists visiting in the centre.
Over the next three years the company plans to allocate one or two trolleys for IT lifestyle products in a project called "Gateway Ekamai" connected to Ekamai skytrain station.
Wallapa Traisorat, Executive Director,said that the 8,000-square-metre Digital Gateway combined digital technology,entertainment and learning for a new generation. It is also the first IT lifestyle centre in its group portfolio of computer centres which includes Pantip Plaza in Pratunam.
The building itself looks like a space tunnel which links the present with the future. The centre showcases the latest interactive media.
The centre has also partnered with Microsoft to become the first "Clean Mall"- an IT centre without any pirated software.
There are other IT flagship stores like iStudio, which is the second largest in Thailand, and the biggest True Lifestyle Shop. In addition, Oakley has also opened its second largest outlet in Asia.
Wisanu Wangwisut, Managing Director of Thippatana Arcade, the developer and property manager of Digital Gateway,a subsidiary of TCC Land Group, said that the centre's visitor profile ranged from 13 to 29-year olds, the dominant age group in Siam Square, and expected 100,000 visitors per day.
The company's expansion plan includes Pantip Plaza Bangkapi, a traditional computer centre which will open this September. It also intends to find other potential areas for computer centres such as Bang Yai district and Charoen Krung Road.
Accharas Ouysinprasert, Intel Microelectronics (Thailand) Country Manager,said the establishment of digital lifestyle centres and specialist stores showed how developed and mature the computer market here had become.
For trendy users in the centre, price is not main issue in making decisions but the users are more interested in styles and designs which reflect their personalities. For instance, the prices of notebooks with the same speed CPU may differ because of the other features they offer which serve a variety of consumer lifestyles. For example, Atom processor that can be used in normal netbooks or gadgets, and Asus HTPC keyboard with a five-inch small screen display with built-in HDMI port.
The recent consumer ultra-low voltage platform which helps to produce new ultra thin and light notebooks ranges from 20,000-80,000 baht depending on the material, design and other unique features.
From a design perspective shape, colour and materials, even in dustless key-boards or automotive power light safe display can attract experienced users or second-time buyers.
Pornthep Watchara-Amnouy, Managing Director of ASUSTek Computer,said that the company has to help its retail partners to select mid to high end notebooks and gadgets to fit in with the profile of the centre.
Chan Chaovanich, Managing Director of Speed Computer which has three brand shops in the centre, said because of higher rental costs from others, this is the first time that its big three suppliers - Asus, HP and Intel- have supported the space cost.
Meanwhile Ekachai Sirijirapatana,President of IT City, one of the largest IT superstores in Thailand, said that within the next three years, IT centres should have space of more than 10,000 square metres in order to support a variety of products for customer needs.
IT is a highly competitive market which has lowmargins ranging from 6-13 percent, so the volume of sales is important.If this sells in high cost rental area it means more premium products to sell even it has a greater margin, the volume will not cover the expenses.
"I think the upcountry areas, especially those with local department stores that still do not have IT shops and growing demand from consumer as well as low rental price more attractive," Ekachai said.
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