Food
Electrical goods, information technology and furniture retailer Courts Asia believes that while e-commerce has been gaining popularity, retailers should not neglect their brick-and-mortar operations. The Singapore-based company also sees technology and renting in suburban areas as important revenue sources.
Terry O’Connor, Group CEO of Courts Asia (Photo by Courts Asia)
Terry O’Connor, group CEO of the Singapore-based retailer, said that physical stores still play an important role for retailers. “Especially in the case of high-demand products like the latest smartphone, customers want to make sure they get one, rather than waiting for it to be delivered another day,” he said. O’Connor noted that online shoppers do not necessarily prefer delivery, as they may not be home to receive the goods when they arrive. “About half of our customers buy online and then collect (the goods) from the store,” he said.
Investing in technology is also crucial for retailers to grow their business. Courts Asia recently implemented a queuing system recommended by Google for their online peak periods. “The system stops the website from crashing by having a slightly moderated waiting time of one to two minutes, so everyone effectively ends up transacting faster,” he said. “It has really helped in terms of the conversion rate and reduced some of the abandoned online shopping carts,” he observed. Courts Asia saw higher sales on 2015’s Black Friday and Cyber Monday peak shopping days compared with a year earlier.
For retailers entering a new market, renting space in suburban areas can reduce costs and gain access to more customers. O’Connor warned that new retailers “will have to pay high rent from day one” if they instead start their business by renting space in the central business district or prime areas. He added that this in turn increases costs significantly and result in the retailer losing out on customers who live outside the city.
He also suggested that investing in areas that complement the core business is an important step in a company’s expansion. “A lot of retailers that have gone into a completely different field have failed, as it is not their core skill set,” he said. Retailers should go to “the most adjacent category which has a synergy to what they already sell.”
Courts Asia has grown into one of the largest retailers in Southeast Asia, with 80 stores totaling over 148,600 sq. meters of retail space. Originally named Courts, the company began as a furniture retailer in the U.K. It was established in Singapore and Malaysia in 1974 and 1987, respectively. In 2012, it was renamed Courts Asia and listed on the main board of the Singapore Exchange. In 2014, Courts Asia entered the Indonesian market.
