small and medium thoughts: September 2006

Thursday, September 28, 2006

Will Bangkok's new airport further dampen's KLIA's hub hopes?

KLIA: Spot the 5-star airlines.

Bangkok's spanking new Suvarnabhummi (or Golden Land) Airport opens for service today. Though beset with delays and rumours of corruption as well as being the brainchild of its newly ousted Prime Minister Thaksin, the first day of operation seems to be have gone smoothly, with only some delays in baggage-handling.

The $4bn airport is now the largest in South East Asia, and is capable of handling 76 flights per hour and 45 million passengers per year. It will certainly boost Bangkok's already popular status as a holiday destination of choice and as the second most popular hub in the region after Singapore's Changi.

KLIA will have to settle for third place and be content in developing a niche focus on Middle-Eastern passengers and spillover hub traffic for passengers who don't manage to get their connections via the other two cities.

technorati: bangkok, singapore, kuala lumpur, airport

Sonic Teenager Deterrent finds ringtone & dancetrack success

What will the brits think of next. Remember my posting on the Sonic Teeanger Deterrent or the Mosquito? Well, it's apparently now found new popularity as a dancetrack following its success as a mobile phone ringtone!

The BBC reports that the sound is being used in a dance track, Buzzin', with secret melodies only young ears can hear as a cool exclusion to older ears.

Loan Sharks slash rates to keep up with competition

I was pretty amused by the Headline Story in today's Star that Loan Sharks (or as they are more popularly known, Ah longs) are beginning to slash their rates to keep up with aggressive competition from banks.

Quoting someone called "Ah Meng", the paper reports that loan sharks are driving down their interest rates to as low as 5% per month, from their usual 30% just to stay ahead of competition from banks who are offering attractive personal loans.

In fact it was once reported that many local businesses had to resort to loan sharks since banks and other financial institutions had turned them down so often.

Which only serves to confirm that banks and Ah longs serve a common purpose: supply broke folks with money and squeeze the life out of them when they fail to pay up together with the exorbitant interest.

I know full well what it's like with a massive home loan to repay. Try missing one instalment and see what happens... :)

technorati: loan sharks.

Monday, September 25, 2006

Write a letter to yourself - In the Future!

Want to tell yourself to be a millionaire by the time you are aged 40? Well, write an email to yourself at this nifty little site and you'll be sent an email when you enter your 4th decade.

Futureme.org is a brainchild of Matt Sly and Jay Patrikios, when Mr Sly was a teacher in San Francisco trying to devise a project for his pupils.

So start writing those dreams down and read them 10 years in the future!

Thursday, September 21, 2006

1.2 million illegal Indon Workers in Malaysia

First of all, apologies for the lack of updates. Have been busy travelling. Not to Bangkok thank goodness but not been able to update the blog.

The Jakarta Post says that 1.2 of the estimated 1.7 million Indonesians working in Malaysia are there illegally.

1.2 million! That's already about half of our Malaysian Indian population and a staggering 10% of our labour force - and I'm sure it's growing quickly.

Which leaves me to ponder - everything our SMEs and our government does, will benefit at least 1 illegal Indonesian worker out of 10 workers.

Technorati tags: illegal workers, Indonesia, Malaysia

Wednesday, September 06, 2006

Singapore: the Best Place to do business

Yet again our neighbours down south have won another feather in the business cap. The World Bank has ranked them no. 1 in the world for overall ease of doing business. Fuller details and individual country rankings here.

And where does Malaysia stand? No 25 - unchanged from last year. In the region, Thailand ranks ahead of us.

If you study the detail we have particularly appalling ratings on "Dealing with Licenses" and "Enforcing Contracts" while we do quite well in "Getting Credit" (surprise, surprise!) and "Protecting Investors".

The main indicators for "Dealing with Licenses" are:

all procedures to build a warehouse,
average time spent during each procedure,
and official cost of each procedure

Whereas the main indicators for "Enforcing Contracts" are:

number of procedures from the moment the plaintiff files a lawsuit in court until the moment of payment
time in calendar days to resolve the dispute,
and cost in court fees and attorney fees, where the use of attorneys is mandatory or common, expressed as a percentage of the debt value.

Sobering isn't it, especially when our International Trade & Industry Minister is asking foreign investors to go elsewhere.

Technorati: investors, Malaysia, business.

Recurring revenue: breakfast of champion smes

“Would you like to sign up for a course?” the lady asked before giving me my haircut. “Huh? What course? I don’t need to take any lessons in hairdressing surely?” “No, no – not that kind of course lah. You sign up a course of 10 sessions and we give you a special discount rate for your haircuts lah!”
“Oh I see!”

What had started off as a budget conscious consumer (i.e. yours truly) wanting to take advantage of a RM9.99 haircut, ended up as a lesson in recurring revenue.

It appears everyone is getting into the act, including hairstylists. Recurring revenue, for the uninformed, is simply revenue from a consumer/subscriber that is certain to continue in the future. Our newspaper delivery man is most familiar with it and so are our incumbent telco operators and utility providers who bill us on a monthly basis.

Recurring revenue builds a healthy, dependable income stream into the business and allows companies to operate with a lot more certainty. It’s a direct way to instill customer loyalty, effectively tying people to your company’s services for a longer period of time.

It also impresses the socks off potential investors/lenders when they see a healthy bank of future income in your business.

So how can a business owner build some form of recurring revenue into their service offering?

If you sell products, offer a 12 month maintenance program which the consumer can opt for (e.g. If you sell aircons, offer a monthly maintenance and cleaning service).
In a cut-throat, me-too business such as groceries or stationery? Value-add by offering additional services like deliveries for regular customers or doing a fortnightly no-obligations visit to the office and offer to replenish their supplies.
If you sell services, package them so as to reward frequent visits (e.g. 1 treatment/visit for RM40 but 3 visits for RM90 total etc.)
Reward loyalty. Minimise one-off deals which only benefit deal seekers who won’t be loyal to you anyway. Invest your money in customers who will give you superior lifetime value.
Do your maths well and you could even offer your product for free as long as your customer pays a monthly service fee. Drinks dispenser manufacturers offer their units for free as long as you buy the supplies and refills from them. Once you cancel the contract, they take back the product.

Look to create long term value and not just one-off deals and you will be able to build a more profitable and secure business.

Technorati: revenue, SMEs, entrepreneurship, business

Saturday, September 02, 2006

Will floods & traffic drive online shopping boom in Malaysia?

Don't laugh. Britain's surging online retail market has been partly attributed to the fact that its citizens prefer to stay indoors because of their infamous weather.

I was caught in the massive jam last week on the KL-Seremban highway, sitting along with thousands of motorists for at least 3 hours trying to get home and being prevented from doing so by the flash floods at Sg Besi. All thoughts of buying groceries on the way home fell to bits when it became depressingly clear that no-one was going anywhere in a hurry.

So if weather is such a good driver for online shopping, then why hasn't it caught on in this country?

Connectivity for one. We still struggle with a low penetration of broadband usage in our households (about 8% versus say 25% for South Korea, or the massive 55% for the UK).

Secondly, there are hardly any local online shopping sites to speak of. A quick Google search unearthed this grocery site and even then, it's been suspended.

However, according to an AC Nielsen report, more than 55% of Malaysian online shoppers buy airtickets on the internet! Must be thanks in no small part to the aggressive marketing efforts of Air Asia.

Overall, however, if you see what people buy globally, it remains clear why Malaysians are generally still slow in taking to online shopping:

"Across the globe, the most popular items purchased on the Internet are books (34%), followed by videos/DVDs/games (22%), airline tickets/reservations (21%) and clothing/accessories/shoes (20%)."

Books: It's a well-known fact that Malaysians don't read. Magazines and newspapers are NOT included thank you very much.
Videos/DVD's/Games: The local Low Yat hole-in-the-wall stalls boast a better uncensored variety at a fraction of the price.
Airline tickets: Okay, since there still aren't any convincing fakes of this around, we do quite well here.
Clothing/Accessories/Shoes: Now which Malaysian woman would want to be deprived of the sensory delights of our gorgeous malls and do something as boring as shop for her clothes on the net???

Technorati: Online shopping, Malaysia

Oil Income allows for expansionary Budget

Well, at least all those petrol price increases have resulted in something beneficial - at least for malaysian businesses.

For the first time in 9 years, the government has cut corporate tax by 1% from 28% to 27% in 2007. There will be another 1% cut in 2008. While there were no personal tax cuts, analysts expect that this might happen when GST is finally implemented in about 3 years time.

Though there are no additional goodies for SME's in general, those in the biotechnology field will get 10 years tax exemption.

Technorati: Budget, taxes, Malaysia

Friday, September 01, 2006

Happy 49th Malaysia

A bit belated I know but technology in the form of a dead copper line at home prevented me from uploading this earlier.

Anyway, my 3 wishes on our nation's birthday:

Less government involvement in business - leave business to business people.
Less crutch-inducing policies for this country.
Less irresponsible race-based politicians who only care about their selfish ambitions.

Selamat Merdeka Malaysia.

P.s. Thanks to Chronosight for that nifty little jalur gemilang badge on the top right hand corner!