Thursday, September 21, 2006

Do what you do best

Focus on core activity- should just stick to its core competency, which is to provide transportation services to the island in whatever form, such as its subway trains, buses and taxis. Obviously it does not have the time nor the expertise to manage shopping malls within its premises in the subway stations, such as the Dhoby Xchange.

In spite of it being located in one of the busiest subway stations on the island (it houses both SMRT's and TransitLink's subway train stations), we are told that the Xchange is virutally a ghost town. And that's not because the goods and services on offer in these places are not interesting. Well, actually, I wouldn't know. People, including myself, do not know how to get there. Some do not even know it exists in the first place! If SMRT takes the stance that they will build the mall, collect the rent and leave the retailer to sink or swim, then in the long run, retailers will just pack up and leave. There are probably better places and better landlords that will work together with them to ensure that their businesses are successful.

The SMRT should get serious and employ people who are good and know this area of business so that some professionalism can be injected into an organisation that basically moves people and not entertain them. But this will depart from its core competency of transportation services. I don't see why SMRT should want to go into this area of business just because it owns potentially commercialisable retail space in its subway stations. SMRT has certainly already expanded into this area of business significantly, going by the growth of retail business locations in many above-ground MRT stations such as Pasir Ris and Sembawang.

Alternatively, the SMRT can outsource the management of these malls and retail spaces to a party that specialises in these things. These mall operators will probably have the networks, programmes and trade linkages that gives them the competitive and cost-advantage in operating these malls and places that will yield an even higher return on investment.

It is a fact that SMRT moves people very efficiently, but probably lacks the mindset and ability to attract and entertainment shoppers.

p.s. Just so that you do not mistaken this to be idle ranting, the writer has a Diploma in Retail Management from the University of Stirling.

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