Electronics malls crumbling under online shopping boom in China

February 4, 2014 Leave a comment

Electronics malls crumbling under online shopping boom in China

Tai Jui-fen and Staff Reporter

2014-02-02

Operators of giant shopping malls housing electronics shops in China are swiftly losing customers and vendors as tenants disappear in the shadow of stiff competition from the booming e-commerce sector, reports the Chinese-language China Business Journal.

“Traditional malls selling tech products are barely weathering the impact of e-commerce, declining at an annual rate of 20% with no end in sight,” according to one survey.

Half of the shops located in two leading malls in Beijing’s Zhongguancun have shut down, even though the area’s name had been well-known even down the stretches of the Yangtze in the past, said Qi Bo, secretary-general of the Chamber of Beijing Zhongguancun Electronic Trade.

Tenants were no longer willing to rent spaces in a mall, despite heavy discounts of up to 50% on rent being offered.

The demise of the brick-and-mortar malls has been linked to the rise of e-commerce, and Zhongguancun has seen the impact as retail consumers flock towards wholesale vendors, the shop owner stated.

An expert pointed out that traditional malls in areas such as Zhongguancun or Shenzhen’s Huaqiangbei should transform themselves by introducing high-end industries, including the China Technology Exchange or trade of patents.

He also suggested that malls evolve into a flagship venue for electronics goods from their current role as a shop market, and develop services for the tech sector to improve their competitiveness.

 

Filed under Macro Trends

Unknown's avatarAbout bambooinnovator
Kee Koon Boon (“KB”) is the co-founder and director of HERO Investment Management which provides specialized fund management and investment advisory services to the ARCHEA Asia HERO Innovators Fund (www.heroinnovator.com), the only Asian SMID-cap tech-focused fund in the industry. KB is an internationally featured investor rooted in the principles of value investing for over a decade as a fund manager and analyst in the Asian capital markets who started his career at a boutique hedge fund in Singapore where he was with the firm since 2002 and was also part of the core investment committee in significantly outperforming the index in the 10-year-plus-old flagship Asian fund. He was also the portfolio manager for Asia-Pacific equities at Korea’s largest mutual fund company. Prior to setting up the H.E.R.O. Innovators Fund, KB was the Chief Investment Officer & CEO of a Singapore Registered Fund Management Company (RFMC) where he is responsible for listed Asian equity investments. KB had taught accounting at the Singapore Management University (SMU) as a faculty member and also pioneered the 15-week course on Accounting Fraud in Asia as an official module at SMU. KB remains grateful and honored to be invited by Singapore’s financial regulator Monetary Authority of Singapore (MAS) to present to their top management team about implementing a world’s first fact-based forward-looking fraud detection framework to bring about benefits for the capital markets in Singapore and for the public and investment community. KB also served the community in sharing his insights in writing articles about value investing and corporate governance in the media that include Business Times, Straits Times, Jakarta Post, Manual of Ideas, Investopedia, TedXWallStreet. He had also presented in top investment, banking and finance conferences in America, Italy, Sydney, Cape Town, HK, China. He has trained CEOs, entrepreneurs, CFOs, management executives in business strategy & business model innovation in Singapore, HK and China.

Leave a comment