M a l a y s i a杂 货 杂 志

Gong Xi Fa Cai

RM12.80Malaysia’s 1st Business Improvement Magazine for the Traditional Retail Trade

RuncitM a l a y s i a

For

Inte

rna

l C

irc

ula

tio

n

PP

1

41

67

/6

/2

00

6

Information: The Power to Succeed

English Edition For Marketers Only

Vol 3 : Dec 2005-Jan 2006

Brought to you by:

Runcit Media Sdn Bhd(formerly known as Rural Reach Sdn Bhd)

Cashing In On Chinese New Year

�

Foreword

Wishing you a

Ministry of Domestic Tradeand Consumer Affairs Malaysia

Endorsed by:

In collaboration with:

Malaysia Milk Sdn Bhd

Publisher

Infovantage Sdn Bhd (47�599-M)

Suite 1�.01, 1�th Floor, Menara Merais,No 1, Jalan 19/3, 46300 Petaling Jaya,

Selangor Darul Ehsan.

Corporate OfficeTel: +603 7957 1718Fax: +603 7956 5109

Editorial Office Tel: +603 51�� 5385Fax: +603 51�1 5��6

runcitmalaysia@runcit.com.my

PP 14167/6/2006

Editorial Team Advisor

Chow Nyuk Loong

Manager, Editorial ServicesDarius Chan

EditorsStephen Tan, Alan De Souza

Creative DirectorJohn Wong

WritersSharmila Valli Narayanan, Adeline Wong,

Sherin Almashor, Phill Teoh

Graphic DesignKinson Tham

PrintingAtlas Cetak Sdn Bhd

ADVERTISING SALESElenie Tan

Head of Client ServiceRuncit Media Sdn Bhd (15535�-V)

Tel: +603 7957 1718Fax: +603 7956 5109

elenie.tan@runcit.com.my

Runcit Malaysia is an educational magazine published by Infovantage Sdn Bhd. The contents of this magazine are the copyright of Infovantage Sdn Bhd. No part of this publication may be reproduced in any manner or form without written permission from Infovantage Sdn Bhd. All contributions whether solicited or unsolicited, and if selected for publication, will be subjected to editing of style and content at the discretion of the Editorial Team. Unsolicited materials are sent in at the owners’ risk. All care is given to ensure that information in the magazine is correct at the time of printing. However, Infovantage and its representatives accept no liability for loss or damage. Runcit Malaysia magazine is a professional trade magazine distributed on a complimentary basis to retailers in the traditional trade.

Copyright © Infovantage Sdn Bhd 2005

For most members of the traditional retail trade, it’s that time of the year again to play the Chinese New

Year songs; dress the shop in auspicious red and gold decorations; lay out the lap ngap (waxed duck), lap cheong (Chinese sausages), kum oranges, and other delicacies; proudly display the hampers, and even re-arrange the premises. All this, just to make way for the throngs of festive shoppers who will help you usher in the new year with the maximum sales possible.

So as to add to your festive mood, we’ve made this issue of Runcit Malaysia a very special one. We hope you like our vibrant Chinese New Year cover that captures the spirit of the season for all Malaysians. We also hope that you will enjoy our lively and insightful focus on this festive period and the advice it offers to boost sales, in spite of the present economic conditions and changing consumer preferences.

On this note, we’d like to thank all the retailers who willingly participated in our survey that was conducted in various parts of the country in November �005 on the business of Chinese New Year. We also wish to express our appreciation to the suppliers/manufacturers who agreed to be interviewed on their views and insights on the same topic. We hope more will be willing to participate, in the spirit of sharing, in future initiatives like this. For now, the voice of the trade and suppliers is

strong and clear – retailers are all geared up to do their best this Chinese New Year and suppliers/manufacturers are just as eager to do their bit to help.

There are many other fascinating stories in this issue. On business ethics, we speak to the Chairman of the Consumer Claims Tr ibunal on the growing awareness of consumer rights, and accompany the article with another on fair price practices. On finance and administration, we show you how to calculate your business performance with the article on Key Performance Indicators.

We invite you to discover the many more ideas, tips and techniques on how to strengthen, enhance and modernise your business in the pages to follow. Knowing that you will benefit from this publication is the finest reward that we can hope for as we usher in a brand new year that’s full of potential and positive possibilities!

We w i s h a l l o f y o u h a p p y h o l i d a y s a n d h a v e a s a f e j o u r n e y t o t h o s e who are travelling!

Gong Xi Fa Cai!!

WILLIAM KHOOExecutive Director,

Infovantage Sdn Bhdwilliam.khoo@runcit.com.my

Runcit Media Sdn Bhd(formerly known as Rural Reach Sdn Bhd)

3

Rencana Runcit 杂货论坛

Will your cash register be ringing louder and more frequently this Chinese New Year period?

Here are the signs of what to expect and do.

on Chinese New YearCashing in

Gong Xi Fa Chai! For the traditional retail trade, Chinese New Year is the most important time of the year. The sales

it generates obviously makes an important contribution to your shop’s performance. If so, to what extent and just how do you maximise the potential that this festive period brings?

In order to get a clearer picture on the impact of Chinese New Year, Runcit Media Sdn Bhd conducted a nationwide survey of 181 retailers from November 14-�6, �005. Here’s the gist of what we found.

In a nutshell, 79% of respondents reported dramatic sales increases during the Chinese New Year period! Nevertheless, all the retailers were equally divided on whether Chinese New Year would provide any indication of how subsequent months will turn out. In fact, 69% admitted to not being able to forecast the economic outlook for �006 – especially after going through �005 with its rising petrol prices, unpegging of the Malaysian Ringgit, rising interest rates, epidemics and natural disasters.

4

How have consumer buying patterns during Chinese New Year changed over the years?4

Buying less traditional foods13%

��%

�5%

37%

4�%

59%

0% 10% �0% 30% 40% 50% 60% 70%

Buying more healthy foods

Buying in smaller quantities

Have not changed

Buying more economicallypriced goods

More last minute shopping

Get a headstartSo as not to miss out on the action, �0% of the retailers start ordering their stocks two months ahead of the festival, instead of just leaving it to the last month, like the other 80% do. Ordering early (provided you have sufficient storage space) might provide a number of advantages. It reflects better planning on your part. You can take advantage of ‘early bird’ deals from the suppliers. Finally, you will avoid situations where delivery is hampered by the flood of last-minute orders from other retailers.

Don’t miss the essentialsAs the survey found, there are certain ‘must-have’ items in every Chinese New Year order list. Avoid disappointing your customers by ensuring sufficient stock of the essentials that they’ll be asking for.

Keep abreast of changingconsumer preferencesConsumers are becoming more cost conscious. According to the survey, they’re buying more economically-priced products (4�% of the retailers) or buying in smaller quantities (�5%). So, make an effort to offer more goods that are attractively priced. Also, add more value to each purchase, (eg by giving free gifts or premiums). Your customers will be more inclined to buy something if they feel that they are getting a good deal.

Across the nation, consumers are also becoming more health-conscious. Through the survey, ��% observed that their customers are buying more ‘healthy’ foods. Related to this, 13% also reported declining sales of traditional delicacies – presumably, because the foods are high in fat, cholesterol, salt and preservatives; or out of sheer ignorance, as to how to cook them, especiallly among the younger set.

How long before Chinese New Year do you start ordering stocks? 2

�0%

80%

� months

1 month

Rencana Runcit 杂货论坛

What increase in monthly sales do you experience in the Chinese New Year period?

No Increase

Up to 50% increase

Up to 100% increase

1

�1%7%

7�%

What festive-related products do you stock more of during Chinese New Year?

Biscuits45%

0% 10% �0% 30% 40% 50% 60% 70% 80% 90% 100%

Cake-making ingredients45%

CNY delicacies50%

Sweets & chocolates54%

Snack foods66%

Asian packet drinks 67%

Beer 84%

86%Carbonated soft drinks

3

5

Play CNY Music 35%

0% �0% 40% 60% 80% 100%

Give ang pow packets 37%

Set up special merchandising corners 44%

Allocate space for product posters, banners, etc 69%

Stock up on CNY goods 81%

Put up CNY decorations 90%

How do you promote sales during the Chinese New Year period?5

You should continue to cater to the majority of consumers who still insist on lap ngap (waxed duck), lap cheong (sausages) and such delicacies for Chinese New Year. However, do try also to cater to the more health-conscious. Anything perceived to be good for health sells well as reflected by the steady increase in the sales of red wine, fruit juices and health tonics (like bird’s nest and chicken essence).

However economic conditions or consumer preferences may change, one thing remains – our Chinese customers are prepared to spend more than usual for Chinese New Year just to augur a prosperous year ahead. So take full advantage of your customers’ need to shop for the festivities. As we all know, the busiest period is one week before Chinese New Year. From the survey, 59% reported that consumers would shop till the last-minute. Therefore, be ready and happy to help, and keep replenishing your stocks quickly. As the saying goes, there’s never a bad time to make money.

Create a festive atmosphereThe survey found that all the retailers go out of their way to give shoppers a nice, big Chinese New Year welcome. The fest ive atmosphere in your shop will attract all kinds of customers, thereby creating an opportunity for you to mount and highlight special promotions even for products unrelated to Chinese New Year. This will further increase your sales. After all, whether Chinese, Malay or Indian, a bargain is a bargain.

Work together for mutual benefitGood sales during the Chinese New Year period is important to retailers and suppliers alike. Neither can’t afford to lose out on this business opportunity that only comes once a year, especially since sales can more-than-double, in some cases. Taking the cue from the survey which uncovered several areas in which suppliers/manufacturers can support the trade, both parties should make this and future Chinese New Year sales periods a time for working together closely to prosper one another.

Rencana Runcit 杂货论坛

Thoughtful Tip!

Merchandising Non-Halal Festive DelicaciesCover your lap cheong sausages and waxed duck s tand in p las t i c so tha t your Mus l im customers would not come into contact with these non-halal products. They will appreciate your thoughtfulness.

C

Runcit Malaysia wishes“Gong Xi Fa Cai”

to all our Chinese readers.

Source: Runcit Media Sdn Bhd Readers’ Survey Report(Nov 14 – 26, 2005)

How would you like suppliers to help youincrease CNY sales?

Provide more point-of-sales (POS) material�7%

0% �0% 40% 60% 80% 100%

Provide promoters/merchandisers38%

Deliver productson a staggered basis46%

Run CNY contestsand competitions50%

Advertise theirproducts more55%

More flexiblecredit terms57%

Free gifts/premiums 83%

Discounts on prices/trade promotions 86%

6

Ste

phen

Tan

& S

harm

ila V

alli

Nar

ayan

an -

Run

cit M

alay

sia

6

We can all be thankful for traditions! Out of the 181 retailers who were surveyed by Runcit Media Sdn Bhd, 60% said that the practice of giving gifts

during Chinese New Year remains pretty strong. Accordingly, hampers rank as the second-most popular gift (37% of retailers), after kum oranges. This explains why total hamper sales in recent years have either increased or remained largely unchanged (6�% of respondents). Hampers are big business, more so in the traditional retail trade than in the modern trade. So what do you need to know to profit from them?

Before the orders start rolling inAccording to 97% of the retailers, hamper orders are mostly taken within the last two weeks before Chinese New Year, right until the eve itself. With the hectic sales activity that the period usually brings, it would be wise not to leave your hamper packing until too late.

Give good serviceMost hampers are bought by regular customers, said 75% of the retailers. So, you might want to consider allowing some of them to pick and choose which products to include. Also, as shown by the survey, about 17% of hampers are delivered by the retailers to their recipients. Perhaps you should consider offering this service as well. These extra touches of personalised service will please your customers but you need to ensure sufficient staff on hand to do the job.

The practice is increasing5%

0% 10% �0% 30% 40% 50% 60% 70%

Fewer people give gifts8%

Depends onthe economic situation�7%

Many people are still upholding the tradition 60%

Has the Chinese New Year tradition of giving gifts changed?1

Increased10%

38%

5�%

Remain the same

Decreased

How have hamper sales been over the last few years?2

Rencana Runcit 杂货论坛

StrengtheningHAMPERSALES

Are you maximising sales of this popular gift?

7

What is the most popular price for hampers?3RM�00

4%RM300

1%RM500

4%

RM50 13%

RM100 78%

What are the preferred items in hampers for CNY?4

0% �0% 40% 60% 80% 100%

Others3%

Bird’s nest 50%

Essence of chicken 50%

Snack foods 51%

Mandarin oranges 53%

Corn flakes 61%

Beer 75%

CNY specialties

8�%Cordial/syrup

8�%

Canned fruits 88%

Biscuits/cakes 90%

Liquor 90%

Soft drinks 9�%

Sparkling juice 9�%

Wine 9�%

Chocolates & sweets 100%

Rencana Runcit 杂货论坛

Price hampers to suit your customersAmong the retailers, 78% said the most popular price for hampers is RM100. However, it pays to offer hampers in other different price ranges, too. After all, let’s not ignore the fact that 13% found RM50 hampers to be more popular while 9% are happily selling hampers priced at RM�00 and more!

Pack hampers with favouritesYou have to ensure that you bundle the right types of products in your hampers or they might not sell well. As an experienced retailer, you’d realise that these products are also the typical festive fare that invariably find their way into your Chinese New Year order list.

The following pages offer a glimpse of some of the favourite brands and product categories to inspire you.

Source: Runcit Media Sdn Bhd Readers’ Survey Report (Nov 14 – 26, 2005)

GOLDEN NUGGETS OF PROSPERITY!

From affluent neighbourhoods to the most modest housing estates, Ferrero Rocher is the most popular chocolate brand for hampers, gift giving and entertaining visitors. The gold-foil wrapping – auspiciously symbolising prosperity – enhances the brand’s popularity. Affordable pricing and innovative marketing strategies are additional ingredients for success.

Daniel Lim, Commercial Manager (South East Asia) for Ferrero Rocher says sales climb more than 100% during the period. “Chinese New Year sales also contribute more than 30% to our total annual turnover, with the traditional retail trade contributing up to 10% of overall sales.”

For more information, please contact: Harpers Trading (M) Sdn Bhd, Tel: 03 - 7966 0011

8

PACKETS OF TRADITION

UHT Asian packet drinks are perfect for open-house entertaining. They are highly affordable, refreshing and convenient to store, serve and dispose. For consumers looking to offer a choice of varieties to their visitors, there is MARIGOLD. This major brand of UHT Asian packet drinks comes in a wide range of variants that includes chrysanthemum tea, lychee, watercress, honey fig, lemon tea drink, winter melon and soya bean. All come in �50 ml tetrapak packets while chrysanthemum tea, lychee and soya bean are also available in 1 litre packs.

“MARIGOLD chrysanthemum tea sells particularly well,” says Benedict Lim, Product Manager of Cotra Enterprises Sdn Bhd, a subsidiary of Malaysia Milk Sdn Bhd, the makers of MARIGOLD. “Chrysanthemum tea has a long association with Chinese culture. The Chinese believe it has a cooling and refreshing effect on the body.”

For more information, contact: Cotra Enterprises Sdn Bhd, Tel: 03 - 7955 4388

Benedict Lim, Product Manager, Cotra Enterprises Sdn Bhd

HEARTY GOODNESS

Paul Lim, Marketing Manager of Ace Canning Corporation Sdn Bhd, thanks the traditional retail trade for contributing up to 58% of total sales during the Chinese New Year period, especially from the soya bean milk segment.

Drinho’s soya bean milk is becoming more popular, mainly due to consumers’ increasing awareness of the benefits of soya protein, especially for heart health.

“We have strong marketing plans, especially in terms of advertising and promotions, for the first quarter of the year, concentrated around the Chinese New Year period.”

For more information, contact: Ace Canning Corporation Sdn Bhd, Tel: 03 - 778� 1�18

Paul Lim, Marketing Manager,

Ace Canning Corporation Sdn Bhd

WINE FOR CELEBRATION

Whereas liquors (like brandy and whiskey) used to be popular, more consumers are now preferring wine as a celebratory drink, especially during Chinese New Year. CM Wong, a Director of Milawa, should know. The company is the distributor of labels, like Wolf Blass, Hutton Vale, Plunkett, EagleHawk and the list goes on.

“Wine is a seasonal product. Our sales increase by about 50% during Christmas and Chinese New Year. In fact, our sales reach a peak in late December and during Chinese New Year,” he declares.

Milawa starts preparing for festive sales about 4 months in advance. “For this coming Chinese New Year, we have requested that the wines come in auspicious red boxes,” he explains. “We also have a gift-with-purchase programme where customers get bottle openers or glasses with their purchases.”

CM Wong, Director, Milawa (M) Sdn Bhd

Rencana Runcit 杂货论坛

For more information, contact:Milawa (M) Sdn Bhd, Tel: 03 - 6�58 8�6�

9

Rencana Runcit 杂货论坛

PRODUCT CATEGORY SIGNIFICANCE TOP BRANDS

Essence of chicken

Essence of chicken is a much-appreciated gift during Chinese New Year. It is viewed as a gift to good health since the product confers a wide range of benefits, including improving one’s metabolism, enhancing mental alertness and overcoming fatigue.

Brand’s Essence of Chicken

Cookies and biscuits

Cookies and biscuits are a well-loved and convenient item when guests drop in unexpectedly, especially if they bring the children along!

DanoneHwa TaiJulie

Nuts In Chinese culture, pistachio nuts signify longevity. But that does not stop consumers from enjoying most other kinds of nuts during Chinese New Year, especially groundnuts. Malaysia’s favourite groundnuts are produced in Menglembu, Perak.

Ngan YinPagodaTong Garden

Chinese sauces The all-important reunion dinner on the eve of Chinese New Year, ’open-house’ entertaining and even Chap Goh Mei feasting cannot be complete without the mouthwatering tastes of Chinese sauces that come in oyster, scallop, seafood and even XO flavours.

Lee Kum KeeLee Shun HingSin Tai HingCheong ChanMaggi

Kum oranges Gold in colour and ‘gold’ by name, kum oranges are a gift that symbolise prosperity and abundance in the new year. For singles, throwing kum into the river is to wish for good luck in their quest for love.

Carbonated soft drinks

In the good old days, orange cordial used to be known as kum sui or ‘golden water’. The auspicious association probably explains the undisputed popularity of orange-flavoured carbonated soft drinks during Chinese New Year. Thanks to the convenience of cans and bottles, carbonated soft drinks of other colours and flavours now add to the festivity as well.

Coca-ColaF&NSpritePepsiMirinda100 Plus

Beer Whereas spirits and hard liquors used to be served up for Chinese New Year, most merry makers now cheer for beer with a loud “YUM SENG”!

CarlsbergTigerHeinekenGuinnessAnchor

Ste

phen

Tan

& S

harm

ila V

alli

Nar

ayan

an -

Run

cit M

alay

sia

Ensure Value-for-Money

Always make sure the price of your hampers reflect the value of their contents. For example, a RM100 hamper should contain goods worth close to RM100, not RM70! Customers will know they are being cheated and they will lose their trust and respect for you.

J Hampers are not for expired or damaged goods

Do not try to get rid of expired or damaged goods by putting them in hampers! This will make your customer look bad when his clients or friends discover what you have done. Expired or damaged goods could also harm the people who consume them.

J

HONEST HAMPERSAdvice from Runcit Malaysia

10

Media Runcit 杂货媒体

INFORMATION: THE POWER TO SUCCEED

KNOWLEDGE THAT EMPOWERS

The knowledge gained through Runcit Media Sdn Bhd enables marketers to make better decisions, develop powerful strategies and act effect ively to enhance their performance while distancing their brands from their competitors.

MONITOR how your products are performing, especially against rival brands within the category.ASSESS retailers’ response towards your newly-launched products and trade marketing initiatives (as well as that of your competitors).GAIN insights into perceptions and sentiments towards your brands, products, service quality and company reputation.

Providing high quality information and insights equal to that gathered from market visits, RMSB places marketers firmly on the pulse of the traditional retail trade.

N

N

N

Marketers who depend on the traditional retail trade need to continually receive, and react to, latest information and insights from the sector.

This can be obtain through Runcit Media Sdn Bhd (RMSB), the only media company in Malaysia that has direct contact with traditional retail outlets all over the country. Through face-to-face information gathering with the retailers and making over-the-counter observations, RMSB is the marketers’ “eyes and ears” where it matters most – inside the shop itself!

11

Media Runcit 杂货媒体

Runcit Media Product ReviewINPOP – Structured Ambient Media

INPOP C-Sign

INPOP C-Sign

Advantages:

A n e s s e n t i a l m e d i u m t o s u p p o r t t h e m a t i c / tactical campaigns.Booking exclusivity to allow category dominance.Market leader image over the represented category.Assured prominence in a cluttered environment.

Key Media Information:

Target Area: Marke t cen t res & suburban outlets.Outlet Type: Modern provision stores, mini- markets & Chinese medical halls.Potential Coverage: Urban towns in Pen insu la r Malaysia.

●

●●●

●

●

●

For further information, please contact Elenie Tan, Head of Client Service, Runcit Media Sdn Bhd. Tel: +603 7957 1718; Fax: +603 7956 5109; Email: elenie.tan@runcit.com.my

19” x 14” image areafor advertising messages

Conspicuously located over walkway

Your Winning EdgeIn A Cluttered & Highly Competitive

In-store Arena

Looking for a way to make it easier for consumers to locate your products in urban and suburban sundry shops, mini-markets and Chinese medical halls?

You need look no further than Runcit Media Sdn Bhd’s INPOP C-Sign.

Appearing as functional in-store signages that attractively complement store décor and merchandising themes, INPOP C-Sign effectively:

Directs consumers exactly to your where your products are situated.Completes the “call to action” by delivering the information they require to buy smart and buy more.

Amid the ‘noise’ of a typical traditional retail outlet, it pays to “shout” above the rest and “grab” the consumer’s attention before she is waylaid by the competition.

●

●

1�