A very personal view of...: The Asian retail opportunity for Openbravo

Last 12th and 14th June in Hong Kong, I had the opportunity to attend the Retail Asia Expo 2012, together with our local partners System In Motion and Ewota.

From left to right: Jojo Wang and Dinglong Chen from Ewota, Sunando Banarjee and myself from Openbravo, Catherine Lam Pesnel and Stephane Monsallier from System In Motion

You can read here a brief article of our solution in the Retail in Asia web page (it requires to register).

After the 3 expo days, I had also the opportunity to go shopping in the Hong Kong streets. What an incredible experience!. Fully recommended. Stores and more stores, commercial centers… The shopper paradise. Here some photos, that I took with my new camera, bought obviously there, in Times Square.

Times Square

Near the Causeway Bay Station

The conclusions of the event have been very positive. First in terms of visitors to our booth, but second and more important, with the confirmation that the Asian market represents a great opportunity for Openbravo. Among the more than 300 visitors during the 3 days, some internationally renowned retailers expressed interest in the Openbravo solution, to improve their retail operations, web and multi-channel, and support the use of mobile devices.

With China and India leading the Asian market growth in the coming years, several aspects appear as key elements to understand the Asian opportunity:

Growing middle class with higher incomes, particularly in China and India
Growing market of young people, particulary interested in western fashion styles
Increased access to technology, such as mobile or internet (China with 420 million internet users)
E-Commerce progressive growth, although not as high as in other areas (due to transactions security and credit card fees)
In the case of India, a progressive market liberalization, and new policies that will help to improve the existing restrictions on foreign investment
In terms of sub-sectors:

Food & Beverage, led by strong growth in hypermarkets, supermarkets and convenience stores, thanks for example to ongoing infrastructures improvement (roads)
Fashion, thanks especially to the young population increasingly interested in Western fashion. Fast fashion (like Zara, from Spanish group Inditex) has a great opportunity . Hong Kong remains as an important market for international brands to showcase their products to Chinese consumers
Fast Moving Consuming Goods (FMCG), with an increasing demand of toiletries (personal care), cosmetics and cleaning products.
Luxury, with China as the second largest world market. Groups like LVMH, the world's largest group in this subsector, showing a significant growth in revenue, thanks especially to the Asian and U.S markets.

The growing presence of international brands seeking growth outside their saturated home markets, such as GAP, H&M, Inditex, Tesco, Carrefour and others, confirm this opportunity. Those established brands, are also moving from large tier-1 cities out to smaller ones, a clear sign of expansion and growth. You can read a lot of news showing the expansion of some of these brands:

Sporting goods retailer Oxylane opens flagship Decathlon store in Taiwan, here
Swedish retailer IKEA to invest $1.9 billion in India to open 25 stores, here
Fast retailing to open 49 Uniqlo stores in greater Manila area, here
Radio Shack continues expansion in Asia, here
Subway to have 1000 outlets in Indiain next 5 years, here
Starbucks US to open 1500 stores in China by 2015, here

In this situation, Asian retailers are facing new challenges, never faced before. Technology plays a key role, with systems that must provide the required agility and flexibility. And because of the IT budget constraints, retailers are also interested to adopt affordable solutions, providing multichannel capabilities, and helping to improve the shopping experience.

Openbravo's solution for Retail fits this scenario perfectly, first from a cost perspective with a subscription based model that reduces the initial investment and the risk over time, an open-source core application platform, and a 100% web architecture that minimizes the IT costs. It is also a multichannel solution with the capacity to use mobile devices. And thanks to a comprehensive out-of-the-box functionality, and unlimited customization capabilities as well, it lets retailer to grow as expected. It can be installed on premise, hosted or in the cloud, resulting in a perfect solution for any IT department requirements. Openbravo POS can be deployed as a local application or as a web applicaton, which can be used with tablets, like iPad or Android devices, providing maximum flexibility and helping to improve the shopping experience.

Openbravo web POS

Retail Backoffice (Workspace with some widgets)

Compared with the rigidity of other solutions, Openbravo´s solution for Retail, offers a high level of flexibility and adaptability, key elements to develop an adapted local strategy. In these cases, even for large international brands willing to maintain the existing head office system (for example based on SAP), the Openbravo’s solution offers unique features that make it a great candidate to support operations in these countries, fully adapted to retailer needs:

As a complete system for supporting the country operations (stores and headquarters), easily integrated with the head office system thanks to its web service based interoperability capacities
As a store operations system, integrated with the head office system as well

The future can´t be more promising. Asia represents a huge opportunity, and we are sure we can help Asian retailers to their existing and future challenges. Retailers like Decathlon in India, Feiyue or Platane in China, or Escapade in Hong Kong, are already relying on Openbravo to run their businesses. But we think it is just the beginning.