(09-06-2014, 09:49 PM)grubb Wrote: [ -> ]Hi CF,
I am looking forward to see the performance of the online store as well. Historically, online grocery shopping has been extremely tough. Perhaps SS could be different?
extracted from the article:
http://www.forbes.com/sites/investopedia...s-failing/
7. No Cost Advantage
The premise behind internet grocers was that shoppers would pay more money for goods delivered to their door. However, the opposite is true. Most shoppers will only order groceries online when they can be assured of saving money. Amazon and other web retailers cut consumer costs by centralizing their products in out-of-state warehouses. This way, they can use national shipping infrastructures, minimize their locations and save consumers the sales tax.
In contrast, an internet grocer must have a warehouse in every metro area along with their own fleet of specialized delivery vehicles, all while charging the same sales tax as a competing supermarket. Due to these expenses, grocery delivery services could cost more than food purchased at a local supermarket.
The article is more applicable to US market, but few points are relevant.
First of all, there must be a central warehouse, to facilitate the delivery. SS has a central warehouse, the Mandai Distribution Centre, with latest automation e.g. pick-to-light system. SS also has its own delivery fleet, which is also used for its retail stores.
Next the product offering is also important. The offering of flesh items by SS online store is a key differentiator, IMO
I would like to refer to a successful online groceries store, the RedMart. It was founded in 2011, with a single van, 2 staffs and a small warehouse. The last numbers I got recently was, it has more than 100-staffs, 17 delivery trucks, and a big warehouse. An aggressive growth plan has been installed with additional VC fund of $10 mil.
I am watching it, as a good reference for online store. SS has been doing all the right things so far, IMO
I am confident that SS can do as good as RedMart, if not better.
(vested)
(09-06-2014, 10:02 PM)psolhawk Wrote: [ -> ]Location of the Tampines store is good. Even with a mediocre Giant outlet at the premise now, business is brisk on weekends. Sheng Siong should do better. That will be the first Sheng Siong in Tampines.
I have no doubt Tampine Central is a good location for retail stores.
After a deeper look into the numbers, it seems SS got a good deal.
The consideration is $65 mil, with GFA of 3876 sqm, or 41721 sqft. It is less than 1.6K psf, which is similar with the previous failed deal in Kallang Bahru.
Kallang Bahru deal is $13.5 mil, with GFA of 8385 sqft, or approx 1.6K psf, with remaining leasehold tenure of 60 years. The Tampine Central remaining leasehold tenure is more than 70 years.
Tampine Central is definitely a premium over Kallang Bahru.
Please highlight if the number is crunched wrongly
(vested)
^^ That place is actually at the fringe of the Central and much less foot traffic. But that probably fits SS strategy of "near but not so expensively near"
My guess is traffic would increase with SS there and those shops around would benefit big time
Just trying to temper down any notion that they got a good deal on "Central" grounds
Its a three-storey building. Not sure if everything is usable for shop floor.
(10-06-2014, 08:13 PM)thefarside Wrote: [ -> ]Its a three-storey building. Not sure if everything is usable for shop floor.
Yes, that is a valid point. Second floor is still possible, but third floor is a bit difficult.
(vested)
(10-06-2014, 09:14 PM)CY09 Wrote: [ -> ]506 Tampines is zoned commercial. The current building, first floor is a food court while the other 2 floors are shop space. The building is serviced by a lift and escalators
I used to frequent the area
that place I went there many many years ago when it's not that crowded at Tampines.. now, I dun remember step into the place anymore..
may be SS just wan to be less expensive compared to those supermarkets in the shopping centers.. think SS is targeting neighborhood families instead of shoppers..
In a market where what you sell is no different from your competitors. The ability to control cost will be crucial in attracting investors.
😇天堂与地狱😈就在当下
I stay opposite that block so I should have the most updated information?
First floor is now helmed by enrichment centres and big-name tuition agencies. Hence parents can do groceries while kids are busy. First floor also has a halal zichar-style restaurant and a Indian rojak restaurant, popular at night and all times, notwithstanding the larger proportion of Muslims in Tampines. While one may discount this location as off-central, it will be the only major supermarket player catering to residents staying in Tampines North Block 400 plus region (no major supermarket I can think of), Tampines East Block 230 to 250 plus, Block 500 plus where Sheng Siong will be at. The nearest competitor to Sheng Siong will be Cold Storage at Tampines One. Different market segment. Different crowd doing groceries shopping at Cold Storage @ Tampines One, and Giant at Block 506. Plus the fact that we have MANY construction of ECs, DBSS and the future development of MORE BTOs at Tampines North and you are going to get a huge expatriate crowd coming on weekday and weekend nights. Those expats really love Sheng Siong. Plus, this will be the only Sheng Siong in Tampines, what more for people who love the brand of Sheng Siong, even if it is blind love for a chance at winning lottery-like prizes on the Sheng Siong show.