Automated-Vehicles-to-reinforce-Retail-Proposition

Automated Vehicles to reinforce Retail Proposition?

Article by Andrea Zaffin commenting on the article “Technology delivered: Implications for cost, customers, and competition in the last-mile ecosystem

The world of automation has always been a fascinating topic.

The future described in this article makes me imaging a scenario of non-stop flow of automated vehicles running up and down our streets delivering our online shopping 24/7 (yes probably we will have automated receiving areas too!) basically extending the supply chain till our doorstep.

Definitely efficient and convenient. This will give additional mileage to online increasing service and convenience to further level.

However the excitement is not without some concern for the competition off line. I think about the impact that this will have on the famous ultimate reason that make us taking time and effort to drive to a physical store: “the retail experience”.

Let’s say that walking around a mall carrying big shopping bags is not exactly the kind of “experience” we look for, so maybe this futuristic evolution driven by automated vehicles might become somehow a service to reinforce physical stores proposition too, at least in this case technology will be fairly applicable to both on and off line retailers for the benefit of all consumers.

Dubai Retail in Dubai

Dubai: The Ultimate Retail Destination

Dubai Retail in Dubai

Andrea Zaffin, Founder and  Managing Partner of Proriented, comments the Article “Dubai’s Retail Space to Surge by 50% in Three Years, CBRE Says”

Normally I am not so inclined to easy going optimism so reading the article at the beginning I was pretty doubtful too of all what is going on.

On the other side having being 18 years in Dubai and having experienced the amazing transformation of the city I started turning my thoughts imaging that this huge increase of retail space actually can be a challenge but also a phenomenal opportunity for Dubai to upgrade commercial real estate and correctly as mentioned in the article to requalify underperforming retail areas to new destinations.

It is true that what is going on is truly massive, it is also true that Dubai proved over the years to have an amazing capability to cope with challenges that initially were looking unachievable.

One for all the ambition to become the biggest international airport in the world headquartering the biggest international airline of the world ….bigger than Heathrow bigger than British Airways….unthinkable 15 years ago….well mission successfully accomplished a few years ago! (ok ok I know I am talking about transportation vs retail it is different ….Yes you are right….However, the spirit driving the ambition to succeed is the same!)

Yes, the challenge this time seems again too big…. the vision first and the execution after to deliver a massive wave of modern new retail space to lead Dubai to become the ultimate global retail destination ….no matter what I definitely love Dubai taking this challenge …..and looking forward to the next one!

Source: https://www.bloomberg.com/news/articles/2018-05-14/dubai-s-retail-space-to-surge-by-50-in-three-years-cbre-says


About Proriented

We are a task force including high-level professionals who operate within your organization and are focused on managing and promoting interests in the territory. At PRORIENTED we strive to innovate and to enhance development. We endeavor to succeed by blending professionalism and mindset coming from a structured corporate environment with agility and entrepreneurship that are typical of SMEs.
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Managing Markets: The “agile solution”

An intermediate solution where companies can localize their business to step-in the market and start building up a stronger foundation.

Managing Markets: opening the door

”Getting Direct” will evolve your competence and capability to do business in the area
and OPEN THE DOOR to establish solidly your own subsidiary at a later stage.

proriented foreign business

6 Reasons you should THINK ABOUT BEFORE creating a foreign subsidiary

Here are six headaches you can expect when you create, maintain, or dismantle your foreign subsidiary:

Initial Cost: A Foreign subsidiary is expensive to set up.  It may cost you between $30K and $40K to set up a Ltd company in Dubai

Maintenance Cost: Foreign subsidiaries cost to maintain.  For just one employee you can expect to spend $20/25K per year in hard costs, on average.

Dissolving Cost/Difficulty: A Foreign subsidiary is like the Berlin Wall when it comes to tear it down.  What happens if the person you hired doesn’t work out or the strategy shifts?Take both the start-up time and cost and multiply them by a factor of 3.

Ever-Changing Compliance: When you have a foreign subsidiary you must keep-up-to date on changes to national/regional/local tax laws, payroll withholdings, employment law changes, and banking regulations – just to name a few.

Local Directors: A foreign subsidiary often requires a local Director.  Are you going to let your one sales person be the Director?  Or will you outsource to someone you’ve never even met and give them the keys to the bank account?

Time Consuming: No matter how much you outsource, expect executives from your legal, finance, and HR team to invest HOURS of time coordinating a foreign subsidiary.
The legal team must review all documents, the finance team must sign off all the expenses and deal with the bank account set up, and the HR must team must review all the employment details.

proriented subsidiary

Firstly can you still stay remote?

It is time to “establish” yourself in your markets

The first logical thought is, “I need to establish a foreign subsidiary in this country now in order to gain a foothold and be able to start securing employees there”.

This thinking process was entirely correct 10+ years ago; you would need to go down this path, spend time and money, and ultimately have another company to manage.

In today’s volatile environment, does it really make sense to create another liability?

We say “No” for 9 out of 10 companies (at least when first entering a market), and can offer an alternative that is inline with the modern “Agile” environment and sharing economy.

proriented

Managing International Markets: The Traditional Approach

Companies operate in international markets typically with two approaches
1 – REMOTE markets are remotely followed by the export commercial team
PROs: low costs, no direct exposure to local complexity
CONs: limited understanding of the territory and low level of control, limited basic network
2 – OWN SUBSIDIARY – opening a local company to localize the management of the market
PROs: develop local competence and direct relationships
CONs: cost of investment, full direct exposure to local complexity, time to build up expertise
The idea is to offer a “NEW SOLUTION” which leverages PROs and minimizes CONs of both approaches

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