SINGAPORE – When he was a second-year student at Nanyang Technological University, Mr Tan Jiayu’s fondness for cycling spurred him to start a bike shop in Sims Avenue.
But the then 26-year-old dismissed any ideas about going online as he felt it would not be a useful strategy for Bikemart SG, which, besides retailing bicycles, also does repairs and deals in second-hand bicycles.
Mr Tan, now 29, a former national triathlete, said: “For high-value items, people don’t really purchase them online. And for a bicycle, people usually need to come to try it before deciding on whether to make the purchase.”
When Covid-19 came along, however, Mr Tan could only repair and service bicycles, with Bikemart SG’s core business of selling new and used bicycles suspended during the circuit breaker from April 7 to June 1 last year as it was considered non-essential.
More than half of the shop’s monthly revenue was wiped out then, and there were also few walk-in customers.
Mr Tan said: “It was then that we decided we had to find ways to reach out to more people. We had a lot of time on our hands, so we started looking at going online and seeing what we could do there.”
After enrolling the business in the SMEs Go Digital programme last June, Mr Tan decided to get it on board e-commerce platforms such as Shopee and Lazada, instead of setting up his own website for direct purchases.
He wanted to tap the large customer base that these platforms already have. Instead of listing bicycles for sales, he decided to sell components and accessories, such as tyres, pumps and gears.
By the end of June, Mr Tan had seen his revenues increase by about 15 per cent, which took him by surprise.
Although business is mostly back to normal now, the additional revenue from online sales has helped greatly in the company’s recovery.
Mr Tan said: “If I knew that there would be an outcome like this, I would have started this much earlier. I thought no one would buy bicycle parts from an online marketplace, because as a former athlete, I would prefer to go to specialised sites to buy things.
“But as e-commerce becomes more popular, I think people are starting to be more receptive to buying things online as long as it is from a credible platform.”
In just a few months, his business has risen to become one of the top five sellers on Lazada, hitting close to 70 to 80 transactions a month. These make up 40 per cent of the bicycle company’s revenue.
But even as online sales boomed, the firm’s back-end processes such as stock inventory management were still being done manually, and someone had to make a deduction whenever something was bought from online platforms. When this was not done accurately, it led to errors such as customers being able to place orders online even when there was no more stock. Mr Tan would then have to make a refund and apologise to the customer.
After about 10 such incidents, Mr Tan decided to adopt digital software that automates the stock-taking process by syncing the stock count across the different platforms.
He said: “Ideally, we would want to make it to a point where the e-commerce side will be doing much better than the retail store. In the event of another Covid-19 outbreak, we would not be as affected and would still be able to cover our operating expenses.”
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