Neighbourhood
Revolution
E-commerce
worries this city of shopkeepers. Neighbourhood stores
will lose business if they don;t adapt it - yet few
are prepared.
June 10, 2001
This story is about Singapore, but it affects
every other city in Asia and beyond.
For a quarter of a century, a hardy heartlander, Mr.
T.S. Chew has been running a furniture shop in one
of Singapore's older housing estates.
As Singaporeans upgraded their homes, many turned
to him for their household furniture, allowing him
to earn a decent living and putting two of his children
into universities, one of them in London.
In his mid-60s, Mr. Chew did not see how all this
talk of the Internet had anything to do with his business.
"Things are not so good now because the economy
is down, but it will pick up again when property recovers,"
he said.
When his son tried to persuade him to go online, he
replied. "What for? I'm in the furniture, not
computer, business."
He didn't see what one had to do with the other until
I explained to him that one day his supplier would
likely start selling his products on the Internet.
And that E-business would become a way of life, I
told him over a family dinner.
Customers
would order their furniture directly from the manufacturer's
web-site at large discounts. That could break the
rice-bowl of shops like his.
He
wasn't convinced. How could a machine give people
better service than human beings? How could a computer
guarantee against defective goods, he asked.
But
as we talked on, he saw the light. What a buyer was
getting from him, his son explained, he would could
get online but at much cheaper prices.
During
recent months, Mr. Chew has been taking a greater
interest on the world-wide web.
The
Chew phenomenon is Asia-wide. There are tens of millions
of Mr. Chews all over the continent faced with the
same predicament.
Their
governments cannot - or do not know how to - deal
with it.
Fact
in Singapore, the young generation is taking to the
worldwide web like ducks to water, but the opposite
is true with their parents.
Mr.
Chew is reflective of many older heartland businessmen,
who are unfamiliar with the ways of the computer.
Not only are they not using this new technology to
bring in more business, they see it as "not my
business." Even among Net users, according to
the government, 53 per cent do not know online transactions.
They don't know how to shop on the Net or how to e-file
their tax returns. Most use it for e-mail. One result
- more than 200 Internet kiosks along Orchard Road
for use for pay-to-be-connected surfing - and shopping
- has been quietly removed.
A few years ago, it was an innovative idea. Today,
it is becoming redundant with the advent of a whole
range of hand-held, mobile and wireless web appliances.
The bursting of the dot.com balloon is adding to the
high-tech devaluation. From Silicon Valley to Hong
Kong, E-business has taken a hard knock, leading people
to discount the impact of the new economy.
The
exuberance in tech shares is dead and that has slowed
down its financing and innovative use..
As a result of poor retail knowledge and less capital
investment, the high-tech march will be slower, more
selective than before.But it is far from dying especially
in the business world..
Latest statistics show that businessmen in Hong Kong
(13 %) and Singapore (12.5 %) are leading the Asia-Pacific
in adopting e-commerce. Australia is third at 8.5%.This
means they accept orders and receive payment online.
Not only does Mr. Chew's old-business need a rethink,
but even the newer-tech vending machines are resorting
to it, too...NOW.Today you can use your hand-phone
to buy a soft drink from one, no need money.
In a matter of time, it will include a wide range
of items like sandwiches, a toothpaste, a pack of
instant noodle, anything that is too small to order
online for home delivery.
Using the mobile phone (almost everybody has one)
to buy things will start a new culture of vending
machines in Singapore as prevalent as Japan.
The flip side is the small neighbourhood shops will
be hit - unless they join the race.
The government's toughest act (it knows it) is to
teach the older workers and businessmen to harness
the Net, firstly, for survival and then prosperity.
The big boys, like SIA or Singtel, have no problems;
some are global trendsetters.
Just how How fast small businesses get survive
the onslaught will depend on:-
* How quickly e-commerce spreads,
* The discount given to web purchasers, the
bigger the more will flock to it.
* How innovative the appplications the new
range of hand-carry wireless Internet-phone-television
appliances can introduce to consumers.
* Whether 24-hour connected broadband Internet can
be made to the masses at cheaper costs.
At any rate, small businesses can't live with their
old ways. If they do, sales will drop year after year,
as customers abandon them for a cheaper electronic
buy (some savings go by the thousands of dollars)
before the quick end comes.
SIA, for example, offers discounts of 6 to 30 per
cent on tickets to 10 destinations to draw customers
to its revamped simple, travel-planner web-site. Some
smaller travel agencies are already out of business.
The big ones enjoy benefit from both the new and old
ways.
The same is also happening in other services, like
stockbrokers, insurers, banks, real estate agents
and virtually every business that earns a commission.
Online buyers will be given part of this commission.
The list will grow - slower, steadily - then quickly.
Consolation for barbers though; you can't get a haircut
in the Net.
Seah Chiang Nee
