An ExclusiveProvisionShopWhite PaperSmall is Beautiful :Why Small ShopsFits Perfectlyin the New EconomyA ProvisionShop Whi...
An Overview of                               ProvisionShop White Paper        Content Summary               Page   Title  ...
An Overview of                                                                ProvisionShop White Paper         Detailed C...
An Overview of                                         ProvisionShop White Paper        Detailed Content - Continued      ...
An Overview of                                                               ProvisionShop White Paper                    ...
Introduction  “This fact tells us that it is viable to run   Traditional Provision Shops or small corner shops, were the  ...
Superm arkets                                                                                                  48%        ...
Why Small Shops, and Why Now ?               The Convenient Factor               Only small, near-by shops are convenient,...
The Technology Factor   “The paradigm shift is now back to the      The technology advances in the Internet & Order Proces...
The New Retail Model                                               Proximity Marketing    “Proximity Marketing is the syst...
wait for further instructions. The customer calls wondering if it                                             ever arrived...
The Complete Retail Strategy                                               Retail Positioning                             ...
Retail Positioning                                              - Brand Approach by Dr Paul Temporal  “A strong brand buil...
contributing strength of the Hub.                                             Retail Support                              ...
Retail Management                                             - ProvisionShop Customer Credit                             ...
Retail Resource                                              - ProvisionShop Marketing“ProvisionShop has a dedicated Marke...
Consumers would find useful.                                                   Retail Training                            ...
An Exclusive                ProvisionShop White Paper     Conclusion                       Small is Beautiful :Why Small S...
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ProvisionShop White Paper

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Small Retail Business Owners all over the world are finding it increasingly hard to make a living because of stiffer competition. They lack the resources to fully satisfy customer expectations. With the general public growing in demand for more choice and variety of goods and services, consumers are becoming more spoilt for choices. Competition from bigger retailers are increasing and dynamic. These bigger retailers are re-positioning themselves, making it an even more competitive trade for small players.
This ProvisionShop White Paper is an organised effort to highlight the shift towards the importance of Good & Direct Customer Service and how small shop are better positioned to render services to these demanding consumers and beautifully compliment existing supply value chains.

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ProvisionShop White Paper

  1. 1. An ExclusiveProvisionShopWhite PaperSmall is Beautiful :Why Small ShopsFits Perfectlyin the New EconomyA ProvisionShop White PaperFebruary 2001 First ReleaseOctober 2003 Updated
  2. 2. An Overview of ProvisionShop White Paper Content Summary Page Title 5 Executive Summary 8 Why Small Shops, and Why Now ? 10 The New Retail Model 12 The Complete Retail Strategy 22 ConclusionPage 2 of 18 ProvisionShop White Paper, February 2001
  3. 3. An Overview of ProvisionShop White Paper Detailed Content Page Title Executive Summary 5 What ProvisionShop is all about 5 Overview 6 Introduction 7 Diagram A - Overall Profit Share Why Small Shops, and Why Now ? 8 The Convenient Factor 9 The Technology Factor 9 The Proximity Factor The New Retail Model 10 Proximity Marketing - An Unfair, Sustainable Competitive Advantage 10 Supply Chain, Value Chain - Small Shops Replaces The Perpetual Missing Link The Complete Retail Strategy 12 to 13 Retail Positioning - Multi-Channel Approach - Brand Approach by Dr Paul TemporalSmall is Beautiful : Why Small Shops Fits Perfectly in the New Economy Page 3 of 18
  4. 4. An Overview of ProvisionShop White Paper Detailed Content - Continued Page Title 13 to 14 Retail Support - ProvisionShop Logistic Hub - ProvisionShop Franchise / Cluster 14 to 15 Retail Management - ProvisionShop Financials - ProvisionShop Customer Credit - ProvisionShop Franchisee Expansion 16 Retail Resource - ProvisionShop Marketing - ProvisionShop Advertising - ProvisionShop Contact Center 16 Retail Software - ProvisionShop Software version x.x 17 Retail Training - ProvisionShop University 17 Screen Shots Conclusion 18 The Time is NowPage 4 of 18 ProvisionShop White Paper, February 2001
  5. 5. An Overview of ProvisionShop White Paper Executive Summary“The ProvisionShop Brand is about helping What ProvisionShop is all about small shop owners gain a sustainablecompetitive advantage, about these small shops staying alive, well and profitable. The ProvisionShop Brand is about helping small shop ownersIt’s about using technology, proven retail gain a sustainable competitive advantage, about these small processes & business strategies tomaximise the positioning of small shops.” shops staying alive, well and profitable. It’s about using technology, proven retail processes & business strategies to Kenneth Kam, Founder, Chairman & CEO maximise the positioning of small shops. ProvisionShop Pte Ltd Overview Small Retail Business Owners all over the world are finding it increasingly hard to make a living because of stiffer competition. They lack the resources to fully satisfy customer expectations. With the general public growing in demand for more choice and variety of goods and services, consumers are becoming more spoilt for choices. Competition from bigger retailers are increasing and dynamic. These bigger retailers are re-positioning themselves, making it an even more competitive trade for small players. This ProvisionShop White Paper is an organised effort to highlight the shift towards the importance of Good & Direct Customer Service and how small shop are better positioned to render services to these demanding consumers and beautifully compliment existing supply value chains.Small is Beautiful : Why Small Shops Fits Perfectly in the New Economy Page 5 of 18
  6. 6. Introduction “This fact tells us that it is viable to run Traditional Provision Shops or small corner shops, were the small shops.” jewel of commercial activity in the Retail scene. They signify Kenneth Kam, the efforts of small business owners and individual Founder, Chairman & CEO entrepreneurs, who open small shops, so that they can service ProvisionShop Pte Ltd their neighborhood & community. In the 1980s, things changed as transportation became common and affordable. Shopping centres & malls were created. And so the phenomenal growth in big retailing occurred. They would register turnover of double digit growth and leave smaller ill-equipped retailers miserable. Small retailers on the other hand continued their un-observed growth in terms of “Highest Overall Profit Share” Figure A – Overall Profit Share. In Singapore, during a ten year period, total operating surplus generated by the FMCG trade rose from S$63 million in 1987 to S$71 million in 1998. This has yet to take into consideration of the S$144 million of sales recorded in 1997 prior to the Asian Crisis event. Among the different types of shops, mini-marts significantly improved their share of profit from 8% in 1987 to 41% in 1998. Traditional Provision Shops’ shares also rose from 44% to 53%. In contrast, supermarkets saw a decline in their share, from 48% in 1987 to 6% in 1998. This depicts that mini-marts have domineered in the profit market share as derived through its franchise business model. Minimarts are able to leverage on its franchisors business know-how and management knowledge hence incurred minimal cost and an impressive profit trend. Surprisingly, the traditional Provision Shops have continued to maintain the largest share of operating surplus within the FMCG industry proving that it is viable business trade in Singapore. This fact tells us that it is viable to run small shops. ProvisionShop’s Founder, Chairman & CEO, Kenneth Kam, leads the Company in the ProvisionShop Corporate Culture, consistently adhering to one overriding principle: “Small is Beautiful.”Page 6 of 18 ProvisionShop White Paper, February 2001
  7. 7. Superm arkets 48% Traditional Provision Shops 44% Minim arts Scenario in 1987 8% Superm arkets 6% Minim arts Traditional 41% Provision Shops 53% Scenario in 1998 Source : Department of Statistics, Singapore 2000 Figure A – Overall Profit Share ( As extracted from KPMG Strategic Business Plan for ProvisionShop)Small is Beautiful : Why Small Shops Fits Perfectly in the New Economy Page 7 of 18
  8. 8. Why Small Shops, and Why Now ? The Convenient Factor Only small, near-by shops are convenient, what else could beat that ? Story of an Inconvenient Shopping Experience “Imagine everytime you needed something, you’ll have to drive, take a cab all the way to a Supermarket downtown. You get those few things you want, and on habitual impulse, grab some other non-essential items to justify the journey & effort. After you’ve finish the queue at the counter, you ask yourself why you lead such a mundane life. You orderly place all the items you have in the basket on the conveyer belt and watch the cashier beep away. You wonder if she beeped correctly. You stare hard to catch her beeping twice but she finishes beeping it all and finally says “Your total is $86.95, do you have any coupons?” Aiyah … you wished you’ve remembered those darn coupons but did not bother cutting them out. You console yourself by saying that even if you would have cut them out you would not have brought the right one anyway. You always sigh before you pick out your wallet to pay. When you have to use your cash, you would think you’ll need more of it later and have to go down again to the ATM. Then, instead you use your Credit Cards, the sense of paying the unending monthly interest quickly flashes before you. You are in speechless shock but go away quietly with a trying smile on you face … You try to stay happy & composed, you assure yourself it’s OK because everyone else on earth goes through the same unfulfilling, uncaring, unpleasant, unenjoyable process.”Page 8 of 18 ProvisionShop White Paper, February 2001
  9. 9. The Technology Factor “The paradigm shift is now back to the The technology advances in the Internet & Order Processing basics of having good & convenient proximity services as the most crucial Systems has given big retailers a run for their money. As these Customer Satisfaction Factor. The underlining point is that small, near-by technologies become cheaper to acquire, easier to integrate shops, when fully equipped, fully trained & faster to market. The paradigm shift is now back to the& fully positioned, will do better & win the retail race big time. Who needs a far basics of having good & convenient proximity services as the away hypermarts when there is a virtual one just at the neighborhood corner ?” most crucial Customer Satisfaction Factor. The underlining Kenneth Kam, point is that small, near-by shops, when fully equipped, fully Founder, Chairman & CEO trained & fully positioned, will do better & win the retail race ProvisionShop Pte Ltd big time. Who needs a far away hypermarts when there is a virtual one just at the neighborhood corner ? The Proximity Factor “Being decentralised & near-by Being decentralised & near-by eliminates the need of going all eliminates the need of going all the wayto a central location, the presence of the the way to a central location, the presence of the fully fully equipped small shops creates anideal & focused customer service contact equipped small shops creates an ideal & focused customer point.“ service contact point. As consumer expectation increases, small retailers should learn how to make use of pooled Kenneth Kam, Founder, Chairman & CEO resources & shared best-practice knowledge to tackle & satisfy ProvisionShop Pte Ltd their immediate customers.Small is Beautiful : Why Small Shops Fits Perfectly in the New Economy Page 9 of 18
  10. 10. The New Retail Model Proximity Marketing “Proximity Marketing is the systematic - Our Unfair Sustainable Competitive Advantageeffort in tapping the Life Time Value (LTV) of consumers in the neighborhood.” What can a small shop do that a bigger hypermall cannot ? The answer is that small shop are ideal and within close range Kenneth Kam, Founder, Chairman & CEO to fully utilise ‘Proximity Marketing’. This elevates Total ProvisionShop Pte Ltd Customer Contact, Satisfaction & Experience. The bigger hypermalls will not be able to fully do that because their customers need to make an extra effort to go to them. If you think it is unfair, well it is ! This Sustainable Competitive Advantage is a boon to small shops. Proximity Marketing is a systematic effort of tapping the consumer’s Life Time Value (LTV) in the neighborhood. Imagine serving just 500 families and doing it FOREVER….. Take this number of family, times their daily grocery needs, plus their other Fast Moving Consumables & Goods (FMCGs), plus a range of services they may need. That gives small retailers upto 3 to 10 fold their usual turnover and they don’t even have to pay additional rent or run complex marketing campaigns. They just have to maintain their effort in keeping good customer service and continue receiving support from ProvisionShop. Supply Chain, Value Chain“ProvisionShop positions the small shop as the essential ‘Final Link’ to the supply - Small Shops Replaces Perpetual Missing Link value chain.” The supply chain begins with the customer ordering a certain Kenneth Kam, product, the procurement process picks & packs the product Founder, Chairman & CEO to specification and begins the shipment to the customer’s ProvisionShop Pte Ltd receiving address. If the customer is not a full time customer i.e. he doesn’t sit patiently to wait for his package’s arrival, the missed delivery is usually redirected to a district post office or warehouse toPage 10 of 18 ProvisionShop White Paper, February 2001
  11. 11. wait for further instructions. The customer calls wondering if it ever arrived and gets a response to wait for the re-delivery, usually at periodic working shift slots. He is forced to take leave from work to receive his order, waiting mindlessly for an extra 3 hours for a knock on his front door. ProvisionShop positions the small shop as the essential ‘Final Link’ to the supply value chain. If indeed the customer doesn’t show at the receiving address then the package is redirected to the neighborhood ProvisionShop, so that the customer can choose to collect it himself or to request for a re-send when he has conveniently reach home after his day’s work. Absolutely no fuss, just plenty of flexibility derived from the benefit of having good relationships with your neighborhood shop-keeper.Small is Beautiful : Why Small Shops Fits Perfectly in the New Economy Page 11 of 18
  12. 12. The Complete Retail Strategy Retail Positioning - Multi-Channel Approach “(ProvisionShop) …… has an additional channel through its network of physical Multi-Channels means many contact points or transactional retail outlets. This allows the ‘touch & feel’ factor for the selection of certain channels. A typical MultiChannel example would be the Dell products & a ‘personal service’ factor from the friendly neighborhood shop Computer Sales Process. A Dell customer can call Dell directly, keepers.” fax an order to them or choose their sales configurations on the Dell website. This Dell MultiChannel Brand approach is Kenneth Kam, Founder, Chairman & CEO known as the ‘Customer Order Approach’, where there are ProvisionShop Pte Ltd quite a few contact points for customers to choose from on how they would want to buy a computer from Dell. Currently Dell delivers via a third party logistics company to its customers. Their ‘Customer Delivery Approach’ is a ‘Single- Channel’ set-up which they have so far been very happy with, judging from their sales so far. But in other Businesses or Brand Approach, a ‘Single-Channel’ ‘Customer Delivery Approach’ can lead to bottle neck situations, which may test customer’s satisfaction. ProvisionShop’s ‘Customer Order & Delivery Approach’ is unique from other existing business flows. It is designed to use Multi-Channels for both its ordering & fulfillment processes. Its ‘Order Approach’ is similar to Dell’s, but it has an additional channel through its network of physical retail outlets. This allows the ‘touch & feel’ factor for the selection of certain products & a ‘personal service’ factor from the friendly neighborhood shop keepers. Its ‘Delivery Approach’ facilitates the lifestyles of its customers by allowing them to choose between different modes of receiving the delivery. They can either collect it at their convenience from the shop counter or collect it from temporary storage cabinets outside the shops or even choose from receiving it through personal delivery.Page 12 of 18 ProvisionShop White Paper, February 2001
  13. 13. Retail Positioning - Brand Approach by Dr Paul Temporal “A strong brand builds the asset base of Dr Paul is the author of ‘Branding in Asia’, ‘Hi-Tech, Hi-Touch’ the company, and can be worth many times the value of the actual business & ‘Romancing the Customer’ (March 2001). He is the leading they represent. It can also be used as a Brand Expert in Asia. He has helped ProvisionShop with it Brandfast track to gain market share & ward offpotential competition. Most importantly, a creation, development & management. He is now strong corporate brand reassures customers by fostering a perception of ProvisionShop’s exclusive Brand Advisor and sits on reduced risk & safe acquisition. This is ProvisionShop’s Board Of International Advisors (BOIA), an necessary in an arena where technology can be confusing and difficult to advisory panel created to give ProvisionShop a cutting edge understand.” in its Total Business Strategy. Dr Paul’s brand angle is in the Dr Paul Temporal, birthing a set of unique corporate personality. Using rational & Leading Brand Expert in Asia, emotional traits as qualities, he shapes the final Brand Position Brand Advisor of ProvisionShop, Board Of International Advisors (BOIA) & Customer Relations to focus on absolute customer appeal. His Brand Strategies help ProvisionShop extend beyond its initial niche industry. He has since created a Brand Blueprint for ProvisionShop, so that its unique brand experience can be related to its personnel & business partners. A strong brand builds the asset base of the company, and can be worth many times the value of the actual business they represent. It can also be used as a fast track to gain market share & ward off potential competition. Most importantly, a strong corporate brand reassures customers by fostering a perception of reduced risk & safe acquisition. This is necessary in an arena where technology can be confusing and difficult to understand. Retail Support - ProvisionShop Logistic Hub The Strategic Business Plan (SBP) done by KPMG, which was commissioned by ProvisionShop, has shown that cost & margin is a concern of small retailers. They need to seek out the best pricing and deals, hopefully to increase their profit margin. The ProvisionShop Logistic Hub setup can cater to the immediate needs of the small shops by employing a central distribution system, this reduces cost of storage & procurement for them. Ease of disbursement to these small shops is also aSmall is Beautiful : Why Small Shops Fits Perfectly in the New Economy Page 13 of 18
  14. 14. contributing strength of the Hub. Retail Support - ProvisionShop Franchise / Cluster “The ProvisionShop Franchisees will ProvisionShop does business with its Business Partners. These receive very comprehensive range of support, from reduced Advertising & BPs include on one hand, distributors, wholesalers and logisticsPromotional Costs, to Loyalty Membership companies. On the other hand, it deals with retailers. ThereProgrammes, to Bulk Purchase Savings, to Customer Credit Facilities, to Software are two distinct categories of retailers it deals with. One Upgrades & Maintenance etc. as listed under The Complete Retail Strategy.” category is the ProvisionShop Franchisee, who adopts full compliance to the Brand Structure & Business Processes. The Kenneth Kam, other category is BPs or Cluster Partners who selects certain Founder, Chairman & CEO ProvisionShop Pte Ltd Technology Support or Business Processes piecemeal, without getting the ProvisionShop Brand endorsement. The ProvisionShop Franchisees will receive very comprehensive range of support, from reduced Advertising & Promotional Costs, to Loyalty Membership Programmes, to Bulk Purchase Savings, to Customer Credit Facilities, to Software Upgrades & Maintenance etc. as listed under The Complete Retail Strategy. Retail Management - ProvisionShop Financials Proper accounting and keeping disciplined records does not come easy. These qualities need nurturing and training to surface. The complete process of keeping accounts can be automated and financial software packages have proven that they can do a good job of Data Management. ProvisionShop Financials is a set of tools to help retailers, wholesalers, distributors & logistic Business Partners to manage their inventories and assess their cash flow positions. With state-of- the-art modules that has components that can be optional, these software tools reduces the time & effort small business owners spends on keeping their business in order. It increase their free discretionary time that could be used to increase their business potential.Page 14 of 18 ProvisionShop White Paper, February 2001
  15. 15. Retail Management - ProvisionShop Customer Credit In the past, small shop-keepers keep a booklet that registers the credit status of customers, as a form of value added customer service. This is less common now because of a larger client pool plus the complexities of keeping ‘live’ records and taking unnecessary credit risk exposure. ProvisionShop Customer Credit is designed to transfer the credit risk from the small shops to professional credit risk managers or financial institutions. This forms an important value chain for the customer and allows certain flexibility on payments. If managed well, as it is intended, it could prove to be an interest profit earner for small shops. Retail Management - ProvisionShop Franchisee Expansion A growing business is a profitable business, and so is a expandable franchise brand. With the experience of a Strong & Trusted Brand like ProvisionShop, Franchisee Business Partners may want to take advantage of their affiliation to open a few other shops in the district to position themselves for growth. Location sourcing & marketing research from ProvisionShop will be use to support their efforts.Small is Beautiful : Why Small Shops Fits Perfectly in the New Economy Page 15 of 18
  16. 16. Retail Resource - ProvisionShop Marketing“ProvisionShop has a dedicated Marketing Most small retailer do not have the privilege of having a focus Team that not only supports its Business Partners in their ‘Proximity Marketing’ mind to concentrate their Marketing efforts. Most Marketing efforts but also does detailed Marketing efforts goes to waste when not managed properly.Research to identify premium customers & market niches.” ProvisionShop has a dedicated Marketing Team that not only supports its Business Partners in their ‘Proximity Marketing’ Kenneth Kam, Founder, Chairman & CEO efforts but also does detailed Marketing Research to identify ProvisionShop Pte Ltd premium customers & market niches. Retail Resource - ProvisionShop Advertising Banner & Poster Advertising brings in good & regular revenue to small retailers. ProvisionShop coordinates this efforts to add variety and business opportunities to attract future advertisers. Broadband LCDs and TV Mobile Monitors, can be options added to create a distinct brand atmosphere. Retail Resource - ProvisionShop Contact Center ProvisionShop understands customer needs, in terms of information retrieval & request. An IVR (Interactive Voice Response) systems will facilitate both its Business Partners & their End-Consumers through smooth checking of their accounts balances, initiate re-ordering and administer Customer Servicing. This ProvisionShop Contact Center will be a revenue center. Retail Software - ProvisionShop Software version x.x A retail software to help Business Partners, they would find easy to use. Future versions will include more powerful features that both ProvisionShop Business Partners & their End-Page 16 of 18 ProvisionShop White Paper, February 2001
  17. 17. Consumers would find useful. Retail Training - ProvisionShop University “McDonalds has its Hamburger University Training is crucial to maintaining a competitive edge in any to train it people in Food Management, why not a ProvisionShop University or business. It is the attitude of never-ending improvement that Training Centre to train local & regional shaped the Japanese, making Japan the fastest growing retailers in the industry’s best practices. We should be proud of our roots and our Developed country in Asia. Small Shop owners could learn from heritage & use nostalgia to our advantage.” them and adopt a learning mind-set. McDonalds has its Hamburger University to train it people in Food Management, Kenneth Kam, why not a ProvisionShop University or Training Centre to train Founder, Chairman & CEO ProvisionShop Pte Ltd local & regional retailers in the industry’s best practices. We should be proud of our roots and our heritage & use nostalgia to our advantage. I n ve n t o r y C o nt ro l O rd er En t ry P u rc has e O rd er Ac co unt s R e ce i va b leA c co unt s P a ya b l e G ene ra l Le dg er Cu r ren c y M od u le Cu sto mer Pr ice Small is Beautiful : Why Small Shops Fits Perfectly in the New Economy Page 17 of 18
  18. 18. An Exclusive ProvisionShop White Paper Conclusion Small is Beautiful :Why Small Shops Fits Perfectly in the New Economy The Time Is Now February 2001 Updated October 2003 The author of this White Paper firmly believes that a window of opportunity is open for small retail owners. Author: Kenneth Kam He is also aware the issues facing them which they have to come to terms with ; Contributing Author: Dr Paul Temporal 1. Rising Cost of Operation 2. Lower Profit Margins Research Source : Strategic Business Plan 3. Increasing Competition by KPMG for ProvisionShop April 2001 4. Constraint in Financial Resources & Cash Flow ProvisionShop World Headquarters 5. Business Continuation Issues 9, Temasek Boulevard #31-02 Suntec Tower Two 6. Lack of Resources to Improve Business Infrastructure Singapore 038989 7. Taxation & Corporate Governs Issues. Worldwide Inquiries: This ProvisionShop White Paper encompasses a Proposal Phone: +65.6820.2022 Fax: +65.6234.2022 designed from inception to fully overcome each of these issues head-on. It is angled to break the downward, negative info@ProvisionShop.com www.ProvisionShop.com spirals of small shop business deterioration. Its hopes to introduce industry best practices in both technology and Only ProvisionShop’s Complete Retail business processes from a pooled resource scenario. This effort Strategy can enable you to build better business value & be will help lower overall costs & increase critical business skills. closer to your customers. Brand Approach is unique to ProvisionShop because its focus is ProvisionShop the eventual International scene. Proper Brand Positioning is a trademark of ProvisionShop Pte Ltd, helps us build our business on value & trust. ProvisionShop is the Holding Company. here for the long term. Various product and service names It is said that many small steps makes a leap. Because we referenced herein may be trademarks of recognise that ‘Small is Beautiful’, the first small step forward is ProvisionShop Pte Ltd. All other product and service names mentioned may be what small shop owners need to do. trademarks of their respective owners. Copyright © 1999 - 2003 The time is right. The time is now ProvisionShop Pte Ltd All Rights Reserved Join us and together we can make a difference.Page 18 of 18 ProvisionShop White Paper, February 2001

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