Tag Archives: Business

SME loans at 4% p.a.

I have heard a lot about credit available to SMEs at 4% p.a. News also reported that our finance minister Lim Guan Eng urges banks to give cheaper loans to SMEs. But didn’t know how to get that kind of rate.

I recently found out that in order to qualify for that rate, my company needs to get at least a two-star rating from SME Corp‘s  SME Competitiveness Rating for Enhancement (SCORE). You can apply to be assessed online. Just need to fill in the assessment form, and they will try to arrange for a visit to your premise on an agreed date and time.

I’m currently still in the process, waiting for their visit. I guess that is when they will come check all the information that I put in in the assessment form. So remember to get all the supporting documents ready. After the visit, they will have a rating for your business within a week(?). Armed with the rating (at least two-star), you can then approach SME Bank to apply SME loan under Business Accelerator Programme.

Okay, business is turning to the worse this year, with the Wuhan coronavirus affecting travel, F&B businesses and whatnot in Malaysia. Definitely need some working capital to keep our business afloat this time. Serious.

More businesses packing up in Ipoh

It just reflects the tough economic times we are having that more businesses, those that I have had some remote interests in, are packing up.

The Secret Garden, which is located just around the corner after KPJ Hospital has closed, presumably looking for buyer. Earlier last month they claimed that they were closed for renovation, and would be reopened again early December 2019. That did not happen. Let’s see if they reopen for Chinese New Year in 2020.

Peninsula Cafe, which is located on Jalan Gopeng, Taman Chateau’s side, is up for sale too. They are currently still operating, but I saw an advert on my Facebook news feed recently that they are trying to sell their business for RM150,000. The advert seems to have been put up since last month.

Peninsula Cafe for sale
Both businesses are set in a bungalow, with ample of space around. The Secret Garden has been around for ages. The business they run there is certainly more sound than Peninsula Cafe. They try to serve fine dining type food. It is a nice place for a drink in the evening, with live singing as well sometimes. They can do big functions, like wedding. Peninsula Cafe positions itself to be more like a children friendly cafe, but classy enough for adults. They often have birthday events going on there, because they offer some decorations for the occasions. It is a neat value added service, but it is not easy to run a business this way, with tiny tiny parties for couples and all. Rental for bungalow like The Secret Garden is apparently only around RM4k a month the last time I heard few years ago. Still it is difficult to sustain such business. Think wages for workers is the killer, easily in the range of RM20k and above?

Bubble tea businesses are another one that we will see more of them struggling. One I am aware of is trying to be offloaded for about RM100k, after probably 6 months in business? Many predicted the frenzy will die down very quickly. Yet the sentiment did not deter more bubble tea shops from propping up in Ipoh.

My business can barely hold up to last year’s level, which was already nothing to shout about. In a way it is not as bad as some businesses are experiencing. We had a strong second half to thank for, luckily. But having said that this December is the worst December we had so far.. So it is another tough year ahead, again. Happy New Year!!

 

Haagen Dazs has pulled out from Ipoh

Noticed the Haagen Dazs signage had gone missing the other day I went to De Garden. Someone told me that they are renovating, rather than closed as I initially thought. I found it odd that they would take the signage away though if that was the case.

Haagen Dazs De Garden Ipoh

But later heard that Haagen Dazs has completely pulled out from Ipoh. They didn’t relocate to Ipoh Parade, which again turned out to be fake news. My wife actually brought the children to Ipoh Parade hoping to find Haagen Dazs there after someone told her they have moved there! It is unbelievable what some people can come up with.

We are very disappointed that Haagen Dazs decided to pull out from Ipoh, or in fact the whole of Perak. We love the Haagen Dazs ice cream. Much preferred over Inside Scoop also located in De Garden. No comparison for us to be honest, in terms of the quality and also the blend of taste their ice cream. We can keep eating and eating and eating..

When we were in KL, we brought our children to their outlet too. But turns out that the one in Bukit Bintang, by the roadside, is no longer there either. We went to the one in Mid Valley shopping mall. We used to be a member, and thought we are still a member. But for some reasons after they closed down the outlet in Ipoh, they took out members associated to that outlet from their system too!

Can’t believe a city like Ipoh could not sustain a  Haagen Dazs outlet. They had been around in De Garden for so many years. But to be honest their business did seem to have dwindled, and there is more competition in the form of Inside Scoop as well within De Garden itself. But at least they should have just moved to another location, rather than completely closing the only outlet in Ipoh! Argh!!

 

 

 

Nam Heong is someway behind from 25 branches by 2020

Bumped into this news article dated back in 2017, where it was claimed by the owner of Nam Heong that he will be opening 25 branches by year 2020: Nam Heong to open 25 branches

Robot waitresses in Nam Heong
Image via Marcus Pheong / Malay Mail Online

Few months ago I noticed that the flagship Nam Heong in Ipoh was closed. Till today their website is still showing the shop on its store locator page.

Nam Heong Store Locator

Including this flagship, there are currently still only 10 branches in Malaysia. Someway away from the targeted 25 branches by year 2020. Are we going to see many more opening next year? It is already December 2019. And I have not seen robots taking over waitressing jobs in any of the Nam Heong shops, yet..

 

 

Nam Heong Soho closed?

You see we Ipoh people very kepoh one. Heard that Nam Heong in Soho Ipoh is no longer opened for business. People are wondering whether it is closed permanently or it is relocating. If you look at their Facebook page https://www.facebook.com/namheongsoho/ it is no longer maintained and previous posts have been removed too. Perhaps like their iMiirage, they are closing it permanently, even though they claim that it is merely relocating.

But having said that, I have also heard that the owners (the bunch who founded Old Town White Coffee?) have acquired a piece of real estate next to Ipoh Parade (opposite MBI) from the boss of Weil Hotel. Apparently they are going to build another M Boutique hotel. So it is likely that this Nam Heong is going to be given a new lease of life in Ipoh again there. Or maybe even the iMiirage too lol Both have been launched with great fanfare in Ipoh, but unable to live up to expectation they set themselves. The robot waitresses with celebrity names did not manage to pull in crowds once the novelty wore off. Not sure about iMiirage. Perhaps not enough customers who want to pay top dollars for rather mediocre fine dining food. Soho on the other hand has defied odds and is now full of bubble tea shops, attracting lots of crowds in the evening. Perhaps it is this crowd that is crowding out business from Nam Heong lol There are not a lot of parking spaces to start with anyway. So I am sure the bubble tea phenomenon is having an impact of some sort on Nam Heong’s business. On top of that there are also other F&B businesses like Texas Chicken, Lanna Thai etc.

Soho

Okay we’ll see in a year or two if Nam Heong is appearing in Ipoh again.

Another rubbish year

This year is going to be a lousy year yet again. The only consolation I found today is, based on the business to date this year, it is no worse than last year’s! I find this really incredible, because I thought I have not seen a worse January. Guess my memory is certainly not getting any better. Nobody I talked to seem to be particularly upbeat about the prospect of this year. Those who get to keep their job should be grateful. Those in business, it is going to be a tough year ahead. Will either have to tough it out, outmuscle competitors, or pack up the business. The upcoming Chinese New Year might be a gloomy one this year..

Le Petite Mary Patisserie

Petit Mary Patisserie is a rather well known cafe in Ipoh Garden that serves freshly made bread and pastries, together with other western food which I don’t believe have much to shout about. This Le Petite Mary Patisserie (photo above) is a bakery, belonging to the same owner, that only sells the same stuff, but no sit in area. The shop is located in Gunung Rapat.

And apparently they are planning to have another one opened in Menglembu next month.

Like I have always done, I like to analyse small businesses. It is interesting to see that them venturing into the bakery only business. Previously they have opened another cafe in the form of Purple Moon in Canning Garden. Perhaps they see that Harold’s Bread, which sells slightly higher end bread and buns than the usual Family Confectionery etc, are doing rather well that they decide to have a go in the high end market. As I understand, Harold’s Bread is expanding quickly. They already have shops in Tesco Ipoh Garden, Jelapang and they are expanding to Tesco Station 18 too. (Actually they have shops all over Malaysia now!)

The difference between Harold’s Bread and Le Petite Mary Patisserie seems to be that the former opens in places with high footfalls like supermarket whereas the latter likes to open in places they own in residential areas (actually I am not sure if they own the shop in Gunung Rapat, my opinion was based on their previous cafe venture). To me these businesses need to move tonnes of perishable produce everyday. Harold’s Bread’s business model would be a more obvious choice for me. To me I feel that Ipoh folks are very price sensitive. I am a big eater so I don’t pay lots of money for buns that don’t fill my tummy. These buns are expensive enough for me already. Is there really such a big market for these high end buns, in Ipoh?

Twenty4, South-East Asia’s first smart convenience store

Just read a news report that there is this smart convenience store, called Twenty4, opened in Ipoh yesterday. It is apparently the first of its kind in South East Asia.

From what I understand, it is smart in the sense that no one needs to man the convenience store. It is not quite as smart as the Amazon Go supermarket in Seattle where customers can walk in the shop and grab things out from the shelf without having to so much as going to a cashier or a self checkout till.

Amazon Go, introducing you to the world’s most advanced shopping technology

 

Basically Twenty4 is a shop filled with vending machines, so to speak. Instead of accepting cash, or coins, like the traditional vending machines we Malaysians are used to, these vending machines accept credit cards! LOL You can use PayWave to pay for items you want to buy, or maybe using your e-wallet too if you have one by scanning the QR code on the vending machine’s checkout display.

It may sound like it is quite exciting, but actually to think about it, it is just a marketing gimmick. From one of the video I watched, it is not quicker to buy from one of these vending machines than say from a manned cashier in a typical convenience store. Perhaps the difference is there are multiple vending machines rather than just one cashier serving you, so queue forming is not as likely.

Besides, their claims that they get advertising revenue, from displaying advertisements in their shop or vending machines, I believe, are just trying to give you the impression that the items you buy from their vending machines can potentially be subsidised and thus are cheaper than buying elsewhere. But I very much doubt it. Items sold in convenience stores are typically low value items and it is difficult to negotiate a good price if you are not moving products in volume. (These vending machines can’t store many items, to be honest.) And they don’t sell as many varieties as in a typical convenience store. Moreover, this Twenty4 even occupies a prime space, albeit quite a lousy one, in Ipoh Parade! (I said lousy because it is not connected to the inside of Ipoh Parade. People shopping in Ipoh Parade need to exit the nearest main entrance to get to the store. Not ideal at all.) Perhaps it is a concept store so they can afford to do that, initially. In the long run I believe it will be loss making. The area around there has not a dense enough population (in fact nowhere in Ipoh is dense enough LOL.) There are schools, a shopping mall, and a hotel next to it. But no high rise residential.

For some reasons Ipoh, full of old folks, likes to get into “smart” technologies, with robot waitresses dishing out food in Nam Heong SOHO, and now smart convenience store with vending machines. Is Ipoh really a good place for testing out new technologies for businesses? Perhaps Ipoh just has more adventurous and loaded entrepreneurs than others.

A disastrous August

This is the worst year for our business so far. Over the years the second half of the year was the half that would pull our numbers out from the red. But this year it is so weak that it looks increasingly likely that it would not be enough barred a miracle. This bloody yoyo between GST and SST version 2 didn’t help. In fact I have feeling that our business would be slightly better off if GST remained in place. That Minister of Finance aka Lim Guan Eng is doing nothing of the sort that will boost the consumer confidence. He is just very good in blowing out bad news after bad news in the name of making the previous government, or in particular Najib, looks bad. He’s certainly not the brightest bulb in the ruling coalition, but hey he somehow manages to climb up the ranks, probably with no little help from his father Lim Kit Siang.

Anyway, it’s the 1st of September, the day when SST version 2 commences. Our business won’t have to charge a 6% service tax, because LGE made a U-turn after much complaints from F&B businesses. The threshold was set to be RM500k revenue a year before a business needs to charge the 6% service tax. Then it was revived to RM1 million. And yesterday, or just a few days ago, the threshold was further revised to RM1.5 million. Big deal. The threshold for the previous SST, before GST was implemented, was bloody RM3 million! There will be another round of price increase you better believe it.

Last instalment to a hire purchase loan

Finally paid the last instalment to a hire purchase loan! Had been paying large sum of money every month for the past five years. A significant drain on the cash flow of my business. It’s such a relief that this is finally over. Does it mean I am going to get my life back from this point onwards having been such a slave to money for so long? I certainly hope so. Trouble is that is not really the end of it yet. There are still other loans to settle. It’s just that this is the most suffocating one. Now I’ll have to work on turning the business around with improved cash flow. Revenue has been falling in the past few years. But I am optimistic that this year will be a better year. Last year was a disaster, with increased competition, and with plans that did not work quite as well as I hoped. Alright ini kalilah, and bring on the general election! The redelineation of election boundaries bill that was passed yesterday with a simple majority in the parliament is to improve UMNO’s chance of winning more constituencies, even at the expense of Barisan Nasional’s other component parties. Constituencies are even more racially divided now..