(17-10-2013, 01:58 PM)riverfish Wrote: [ -> ]Challenger is an economies of scale business, like NTUC, Walmart. Hence, expanding their retail outlets and increasing their sale is crucial for Challenger, as bulk buy gives them pricing power with suppliers, which will enable them to keep prices competitive.
I am not too concerned about internet eating into Challenger's territory if it can sustain its economies of scale pricing power. However, Challenger's narrowing profit margins, is something which I will have to monitor closely.
Am more concerned about rising rentals & labour costs, which is a problem for most retail businesses in Singapore. Think in the long term, their successful expansion into M'sia and perhaps beyond, will determine if they are going to do well or not.
I agree with you. I do have my concerns on the declining profit margins. It is still good but not as good as before.
One moat they have is the brand of Challenger. It is a brand that normal consumers can trust. When I buy an expensive product, I want to make sure it works. If sh*t happens, I want to know that I can go back to this place to get it replace/fixed.
It is also a place, where I know I can find a wide range of choices. I am not limited to "Apple" products. It is a one stop shop for all my electronic needs. Heck, I can even rely on the advise from the sales people at Challenger if I am undecided on the product.
Since most of you guys are co-owners of Challengers, may I know if any of you guys have bought Valore products?
The management seems to pushing Valore really hard, and I think it is a good move. Cheap products from China, repackaged nicely, and sold at a price much lower than mainstream brands. Their profit margins should be higher as well.
I do not think they can supress the COGS of mainstream brands. Valore on the other hand, will bring in the profits. All they need to do is make if fly.
(vested)
Tried my best to look through previous posts, hope this is not a repetition (sorry if i missed out).
Here's an article on Valore -
http://www.digitalone.com.sg/features/article/25902/1
In summary the article talks about Epicentre and Challenger getting into the in-house brand business.
Some highlights:
- In-house brand products comprised of tablet and phone cases, USB hubs, computer mice and screen protectors, and more recently car cameras, battery packs, LED lamps, headphones and wireless bluetooth speakers (to address rising demand as stated).
- By 2013 year end, Challenger will start selling video and digital cameras under the Valore brand.
- 2014 - plans to open standalone Valore stores.
"We're not targeting the top end of each product category. Those are well served by the premium market brands," said Ms Loo Pei Fen, group director, strategy and marketing for Challenger Technologies, which runs the Challenger chain of stores.
"Rather, we want to serve the middle mass market who may be looking for similar items but who have had to go to different stores to look for what they want."
- Challenger says its range of more than 150 Valore products have brought in close to $3 million in sales in the past year.
- pages 3 - 4 are about Valore product reviews - average to a notch above average ratings given across products tested
(17-10-2013, 10:45 PM)FatBoi Wrote: [ -> ]Ms Loo Pei Fen, group director, strategy and marketing for Challenger Technologies, which runs the Challenger chain of stores.
I remember Loo Pei Fen running 12buy.sg. Now I am worried.
(17-10-2013, 11:58 PM)cif5000 Wrote: [ -> ] (17-10-2013, 10:45 PM)FatBoi Wrote: [ -> ]Ms Loo Pei Fen, group director, strategy and marketing for Challenger Technologies, which runs the Challenger chain of stores.
I remember Loo Pei Fen running 12buy.sg. Now I am worried.
You have good memory, cif5000.
The young white horse, just hit 30 this year.
She is the daughter of Mr Loo Leong Thye, CEO and Mdm Ong Sock Hwee, Executive Director. All in the family.
If you all read the papers, retail sales for things like computers drop in Q3. Challenger is affected of course. But fred not about falling profit margins. i have my doubts too but Valore is a vision by the management to create higher margins and increase membership to hit 500 000 by end of next year. have faith in the Loo family, you wont want your own business go down. cheers. Challenger is well positioned to out do its competitors and i expect them to rally in Q4 for more growth. im a student and this is the only stock i bought so far. cheers
My last write up on challenger is few years ago when I initiated position on Challenger.
Things have definitively changed now. Higher market cap and besides that some observations.
1. Notice there are alot of sales person employed. I don't know the idea ratio vs store size or the peak hour patrons and how beneficial it is to sales
2. Previously I really like the way of arranging of goods in their stores. But now, I can't really describe but it seems they have same type of good but different variants on the "hanging shelves". Do we really need that much selection on same type of goods? or they are carefully selected types with good margins to cater to masses? I don't know except I detest SLS old way of going through the store of similar but same type function of goods when I shop there.
Year end Christmas is always the period for challenger, good literally fly of shelves. presents for ownself and little presents < $20 for party exchanges. Affordable and functional.
(18-10-2013, 08:20 AM)memphisb Wrote: [ -> ]My last write up on challenger is few years ago when I initiated position on Challenger.
Things have definitively changed now. Higher market cap and besides that some observations.
1. Notice there are alot of sales person employed. I don't know the idea ratio vs store size or the peak hour patrons and how beneficial it is to sales
Yeah, you are right, I noticed sometimes they seem to have too many sales staff loitering idly about. Not very productive leh. This means that they have further room to streamline operations and be leaner and meaner if they want to.
(18-10-2013, 08:42 AM)riverfish Wrote: [ -> ] (18-10-2013, 08:20 AM)memphisb Wrote: [ -> ]My last write up on challenger is few years ago when I initiated position on Challenger.
Things have definitively changed now. Higher market cap and besides that some observations.
1. Notice there are alot of sales person employed. I don't know the idea ratio vs store size or the peak hour patrons and how beneficial it is to sales
Yeah, you are right, I noticed sometimes they seem to have too many sales staff loitering idly about. Not very productive leh. This means that they have further room to streamline operations and be leaner and meaner if they want to.
Possible explanation is new guys are undergoing training before deploying to new stores.
Is Valore owned by Challenger? I noticed they promote this brand a lot. Some of my friends are using Valore products, apprently they r better than the no-brand but inferior to brands like Belkin, Samsung.
(18-10-2013, 08:42 AM)riverfish Wrote: [ -> ] (18-10-2013, 08:20 AM)memphisb Wrote: [ -> ]My last write up on challenger is few years ago when I initiated position on Challenger.
Things have definitively changed now. Higher market cap and besides that some observations.
1. Notice there are alot of sales person employed. I don't know the idea ratio vs store size or the peak hour patrons and how beneficial it is to sales
Yeah, you are right, I noticed sometimes they seem to have too many sales staff loitering idly about. Not very productive leh. This means that they have further room to streamline operations and be leaner and meaner if they want to.
The expense on staff for the company is already optimized, comparing with its peers. FYI, the company spent about 6 cents per dollar of revenue while its peers, CourtAsia spent close to 9 cents, and Harvey Norman spent close to 8 cents.
Competent and helpful staffs will add value to the company, and a good reason for people to visit Challenger in person, rather than other shop or online, IMO.
(vested)