Connect with us

Business

How the bike-share start-ups fell over

The Thaiger & The Nation

Published

 on

How the bike-share start-ups fell over | The Thaiger

They were awful to ride and were the result of an even more toxic start-up culture in China.

A few years ago the bike-sharing craze hit the tourist island of Phuket. It arrived amongst much flourish and ceremony. A year later the bike-sharing company bailed out. It was the same in many targeted tourist zones around the world. At the root was a start-up craze in China which has now left entire manufacturing towns licking their wounds from the excesses of the Sino start-up culture.

The small town of Wangqingtuozhen, near the port of Tianjin in northern China, not far from Beijing, already home to many bike factories, was to win big in the bike-share craze and then lose even more. The boom and bust of China’s bike-sharing companies were just another example of the country’s start up culture out of control.

New ‘unicorns’, that’s start-ups valued at more than US$1 billion, were cropping up every four days in 2018, according to Hurun, a research firm in Shanghai. Some start-ups gather pace, attract investors, are truly good business ideas and thrive. Most don’t. And in the wake of the many failures, small Chinese manufacturing towns have suffered the most.

How the bike-share start-ups fell over | News by The Thaiger

Instead of farm produce, Wangqingtuozhen grew bikes. Now the desolate factory landscape is littered with thousands of unused, unsold and unloved bikes, a grim reminder of the bike-share start up excesses. But it’s not just bicycles. Shopping Apps, ride sharing, bike sharing, truck sharing, internet-of-things ‘certainties’ – deep-pocketed Chinese investors were able to spin these ideas into billion-dollar companies in a matter of months.

Most of them, sadly the vast majority, fail leaving small investors, suppliers and entire towns mopping up after the initial hype dies down to reveal that the businesses weren’t really viable in the first place.

One bike-share company called Ofo came to Phuket with great fanfare.

Unlike bikes with sharing services in New York and big capital cities, the Chinese bikes didn’t need to be parked in a dock. Instead, each bike had its own lock that could be unlocked with a smartphone App. Local municipal politicians, tackling pollution and traffic issues found the idea of big-sharing appealing. It was a brilliant idea, except it was a failure almost everywhere.

How the bike-share start-ups fell over | News by The Thaiger

People would routinely log into the App, take the bike and never return it. The Bike share companies didn’t have the staff to go and find the missing bikes, the municipalities didn’t understand the concept in the first place and the police didn’t have time to try and track down and local cheap bikes that were, after-all, someone else’s responsibility.

Billions of dollars in start-up capital flooded in to these projects, creating opportunities for other entrepreneurs to copy. Soon there were too many share-bike companies and too many bikes. Normally there’d be consolidation but instead more companies sprung up, causing more problems for more communities with a ‘bike glut’ becoming a ‘bike glut crisis’.

Problem with the whole idea is no one really knew how to make any money out of the concept. People were meant to pay a small rental fee which would pair the App with their bank account, blah, blah. It didn’t happen. People just rode away with the bike and that’s that.

How the bike-share start-ups fell over | News by The Thaiger

Yellow bikes became synonymous with Ofo, orange bikes with Mobike, blue with Bluegogo. The bikes for these companies were coming out of Wangqingtuozhen. But as affluent Chinese turned to four wheels and scooters, the factories of Wangqingtuozhen started making bikes for other countries.

At its height, the Shanghai Phoenix Bicycle factory took on so many orders for Ofo’s yellow bikes that by 2017 it was churning out 10,000 bikes a day. And with the start-up, bike-share, bike-boom came a flood of new employees and the building of apartments to house them.

But by the time the apartments were completed the bike-boom had come and gone.

A surplus in 2017 turned into a major bike glut. All this while start-ups like Ofo were trying to offload their bikes and ‘really-good-bike-share-idea’ with municipalities around the world. Bikes were stolen. No problem… plenty more where they came from! The bikes were heading out of the Chinese factories, landing in tourist zones around the world and then vanished into the backyards of households or dumped in the bushes.

A year after they started in Phuket, Off announced they were closing down the business.

Then many factories in Wangqingtuozhen were forced to sell their bikes at huge discounts, setting off a domino effect.

How the bike-share start-ups fell over | News by The Thaiger

But the bikes they were building, as anyone who ever rode one will attest, were a simple bike built for a price and not very, well, rideable or particularly enjoyable. The crash of the start-ups eventually killed off factories, workers left and the town died, leaving factories full of brand new bikes locked and huge apartment buildings deserted.

But from the ashes a phoenix rises. Not really a start-up, just an opportunist that saw a way to make a buck.

25 year old Fang Hui from Wangqingtuozhen, who makes bikes and sells them online, recently bought hundreds of yellow Ofo bike frames. They are still stacked in a pile on the floor of his makeshift shop. He paid just over $2 for each of them, and says he plan to find a way to put them to use.

Maybe sell them to the next start-up!

How the bike-share start-ups fell over | News by The Thaiger

A pitiful end to an Ofo bike, an image representing what happened to most of the start-up bike-share companies

Keep in contact with The Thaiger by following our Facebook page.

Business

Out of 37 countries, Thailand has the worst pension system, says Bloomberg

May Taylor

Published

on

Out of 37 countries, Thailand has the worst pension system, says Bloomberg | The Thaiger

Thai Residents reports that on Sunday, Bloomberg published an article on the world’s best pension systems, using information gathered from the 2019 Melbourne Mercer Global Pensions Index.

The survey looked at the pension systems of 37 countries with metrics including employee rights, savings, the number of homeowners, growth of assets, and growth of the economy. The purpose of the analysis was to determine what was needed to improve state pension systems and to gauge the level of confidence citizens had in their state pension system.

The Netherlands and Denmark were found to have the world’s best state pensions, with Australia, Finland, Sweden, Norway, Singapore, New Zealand, Canada, and Chile next. Out of all 37 countries, Thailand finished last, with what the report described as an extremely ineffective and ambiguous system.

“Thailand was in the bottom slot and should introduce a minimum level of mandatory retirement savings and increase support for the poorest.”

Out of 37 countries, Thailand has the worst pension system, says Bloomberg | News by The Thaiger

Photo: WorkpointNews

Thai Residents states that only those employed within the government system in Thailand are eligible for a pension based on salary. For most Thai citizens, pension amounts vary from 600 baht to 1,000 baht a month, depending on the recipient’s age.

A report carried out by The Securities and Exchange Commission (SEC) advises Thai citizens to have at least 4 million baht saved by the time they retire, but Thai Residents reports that 60% of Thai retirees have less than 1 million baht in savings, with one in three citizens who have reached retirement age are forced to continue working in order to survive.

SOURCE: thairesidents.com

Keep in contact with The Thaiger by following our Facebook page.
Continue Reading

Bangkok

Another Thai hotel management dispute flares up – The Peninsula Bangkok Hotel

The Thaiger

Published

on

Another Thai hotel management dispute flares up – The Peninsula Bangkok Hotel | The Thaiger

PHOTO: The Peninsula Bangkok Hotel

The Hongkong and Shanghai Hotels, which operates luxury brand The Peninsula Hotels, says it will “vigorously defend its rights” to manage The Peninsula Bangkok, following a legal win by the hotel’s Thai shareholder that paves the way for the management agreement to be terminated.

And so the open wounds of a business saga are now on full display between a international hotel management company and the local Thai owners. This time it’s involving one of Bangkok’s best known luxury hotels.

Thai business law prevents many of the international hotel brands actually owning the properties so wealthy Thai families acquire the properties and then contract international hotel expertise to manage the assets where two entities are trying to get a larger slice of the pie. And, for now, the pie is getting smaller with the contraction in the traditional hotel business and the challenges Thai tourism is currently facing.

Peninsula Hotel, the iconic 370 room Chao Phraya riverside hotel, is 50% owned by the Phataraprasit family and the other half by The Hongkong and Shanghai Hotels’ subsidiary in Bangkok.

The Peninsula Bangkok is a 5-star hotel in Bangkok, Thailand. The hotel opened in 1998, counting 37 floors and 367 rooms.

Skift.com reports that the Thai shareholder went to court after it failed to end the agreement in the boardroom on January 26, as it was blocked by the Hong Kong and Shanghai Hotels subsidiary, which has a voting majority in the board. But on September 10, the local Thonburi Civil Court ruled that the subsidiary should not have been allowed to vote on a resolution regarding the termination of the agreement.

The legal case between a Thai owner and hotel chain managers over non-performance, isn’t the first. Minor International is suing Marriott International is sueing the Marriott Group for a “highly disappointing” performance of the JW Marriott Phuket Resort & Spa in Mai Khoa. Minor fully owns the luxury beachside hotel and and Marriott manages. The lawsuit was filed on July 12. The case is ongoing.

The statement says…

“Any termination of Peninsula’s management would be tantamount to a breach of the shareholders agreement between Hongkong and Shanghai Hotels and the Phataraprasit shareholders, as well as the Peninsula’s management agreement. Hongkong and Shanghai Hotels will vigorously defend its rights. Pending the outcome of the appeal and other legal processes which are ongoing, The Peninsula Bangkok continues to be operated by The Peninsula under the hotel management agreement which continues to be legally binding.”

Some background, the Thai Phataraprasit family, who also have interests in The Mall Group (that manages the Siam Paragon and Emporium shopping centres in Bangkok), alleges that The Hongkong and Shanghai Hotels had not run the hotel profitably in the last 20 years.

In an article in the Bangkok-based Travel Impact Newswire, Pradit Phataraprasit, head of the Thai family’s investments, had strong words.

“In the last 20 years, there has not been a single year in which the Peninsula hotel group’s management company has run the hotel profitably for its shareholders.”

“The Peninsula sits on one of the most expensive riverside land plots in this city but, very curiously, it cannot yield a dividend for its shareholders. We have been very patient with the management company belonging to our partners from Hong Kong. However, the time has come for another management company to run this hotel.”

For their part the COO of Hong Kong and Shanghai Hotels, Peter Borer, says the group had always operated “with integrity” regarding the operation of the hotel.

“Over the past decade, the hotel’s financial performance has been affected by political uncertainties and a challenging luxury hotel market in Bangkok, but as a group with a long-term investment philosophy, we have always remained committed to Thailand.

Commenting on the ongoing legal fracas….

“The daily operations of the hotel are not currently affected pending the final outcome of the legal actions.”

The company’s Q1&2 results shows the hotel had a drop of 5% in revenue compared with January to June last year. The average room rate rose 8%, but the occupancy rate dipped 6%.”

Reporting on the results so dar this year….

“The Peninsula Bangkok reported a relatively soft start to the year, impacted by a slower economy and uncertainty over the country’s first elections since 2014. Our hotel was also negatively affected by extensive roadworks adjacent to our property which impacted our food and beverage and catering business.”

Again, the Phuket boat tragedy, killing 47 Chinese tourists in July 2018, was presented as a key reason for current woes.

“Chinese mainland tourist arrivals declined year-on-year following a tragic boating accident in Phuket in 2018 which led to reduced group tourism to the country overall.”

Two years ago Pradit Phataraprasit was named as being involved in the Dhammakaya Temple scandal.

“Prominent Businessman Pradit Phataraprasit has denied any involvement in alleged embezzlement or the scandal-hit Dhammakaya Temple after records show he bought a land plot from a suspected money launderer.”

SOURCE: skift.com

Another Thai hotel management dispute flares up - The Peninsula Bangkok Hotel | News by The Thaiger

Keep in contact with The Thaiger by following our Facebook page.
Continue Reading

Business

500 people own 36% of equity in Thai companies

Greeley Pulitzer

Published

on

500 people own 36% of equity in Thai companies | The Thaiger

Roughly 36% of Thailand’s corporate equity is held by just 500 people, highlighting wealth inequality in the Kingdom, according to a study released by the Bank of Thailand’s research institute.

Each of these 500 amass some 3.1 billion baht (102 million USD) per year in company profits, according to the report from the Puey Ungphakorn Institute for Economic Research. In contrast, average yearly household income in Thailand is around 10,000 USD.

A report out this week from the Economic and Business Research Centre for Reform at Thailand’s Rangsit University also pointed to divisive and polarised politics being another root cause of the economic divide.

Thailand’s private sector is dominated by tycoons running sprawling conglomerates. According to the World Bank, the gap between the mega-wealthy and the rest of the Thai population of 69 million is among the many economic challenges for Thailand. According to Bloomberg, the perception of a divide, exacerbated by an economic slowdown, is a major political fault line.

“Magnates arise in Thailand from institutional factors that privilege certain businesses,” said the executive director of PIER, author of the study.

The institute said Thailand needs to promote competitiveness to reduce profits from monopoly power and bolster entrepreneurship to create a more equitable distribution of corporate wealth.

The research is based on analysis of 2017 Commerce Ministry data on the 2.1 million shareholders in Thai firms, and was funded by the University of California San Diego.

SOURCE: Bangkok Post

Keep in contact with The Thaiger by following our Facebook page.
Continue Reading

The Thaiger Newsletter

Keep up with all the day’s news. Subscribe here.

The latest news and information from Thailand.

* indicates required
สรุปดราม่า “หนังน้องเดียว ลูกทุ่งวัฒนธรรม” เล่นหนังตะลุง “ด่าพระสงฆ์” | The Thaiger
ข่าว1 day ago

สรุปดราม่า “หนังน้องเดียว ลูกทุ่งวัฒนธรรม” เล่นหนังตะลุง “ด่าพระสงฆ์”

ม็อบ “สมัชชาคนจน” เดินเท้าถึงทำเนียบ กดดันรัฐบาลไม่จริงใจ [Live] | The Thaiger
ข่าวการเมือง3 days ago

ม็อบ “สมัชชาคนจน” เดินเท้าถึงทำเนียบ กดดันรัฐบาลไม่จริงใจ [Live]

ชมวาทะเด็ดธนาธร ให้การศาลรัฐธรรมนูญ คดีวีลัค ทำงานการเมืองเพราะอยากเปลี่ยนแปลงสังคม | The Thaiger
ข่าวการเมือง5 days ago

ชมวาทะเด็ดธนาธร ให้การศาลรัฐธรรมนูญ คดีวีลัค ทำงานการเมืองเพราะอยากเปลี่ยนแปลงสังคม

ตรวจหวย 16/10/62 รางวัลที่ 1 เลขท้าย 2 ตัว 3 ตัว เลขหน้า 3 ตัว และรางวัลอื่น ๆ | The Thaiger
ตรวจหวย1 week ago

ตรวจหวย 16/10/62 รางวัลที่ 1 เลขท้าย 2 ตัว 3 ตัว เลขหน้า 3 ตัว และรางวัลอื่น ๆ

ตรวจหวย 16 ตุลาคม 2562 ผลสลากกินแบ่งรัฐบาล 16/10/62 | The Thaiger
ตรวจหวย1 week ago

ตรวจหวย 16 ตุลาคม 2562 ผลสลากกินแบ่งรัฐบาล 16/10/62

ถ่ายทอดสด “สลากกินแบ่งรัฐบาล” 16 ตุลาคม 2562 ลุ้นรางวัลที่ 1 สด ๆ | The Thaiger
ตรวจหวย1 week ago

ถ่ายทอดสด “สลากกินแบ่งรัฐบาล” 16 ตุลาคม 2562 ลุ้นรางวัลที่ 1 สด ๆ

หนุ่มแท็กซี่ฉาว ท้าต่อยเจ้าของธุรกิจเต๊นท์ กลางงานสนามหลวง | The Thaiger
ข่าว1 week ago

หนุ่มแท็กซี่ฉาว ท้าต่อยเจ้าของธุรกิจเต๊นท์ กลางงานสนามหลวง

ไทยแชมป์วอลเลย์บอลอาเซียนกรังด์ปรีซ์สนาม 2 รางวัลรายบุคคล | The Thaiger
วอลเลย์บอล2 weeks ago

ไทยแชมป์วอลเลย์บอลอาเซียนกรังด์ปรีซ์สนาม 2 รางวัลรายบุคคล

ตรวจหวย1ตุลาคม2562 ผลรางวัลที่ 1 เลขท้าย 2 ตัว 3 ตัว เลขหน้า 3 ตัว และรางวัลอื่น ๆ | The Thaiger
ตรวจหวย3 weeks ago

ตรวจหวย1ตุลาคม2562 ผลรางวัลที่ 1 เลขท้าย 2 ตัว 3 ตัว เลขหน้า 3 ตัว และรางวัลอื่น ๆ

ถ่ายทอดสดหวย 1 ตุลาคม 2562 ลุ้นรางวัลที่ 1 สลากกินแบ่งรัฐบาล | The Thaiger
ตรวจหวย3 weeks ago

ถ่ายทอดสดหวย 1 ตุลาคม 2562 ลุ้นรางวัลที่ 1 สลากกินแบ่งรัฐบาล

สีจิ้นผิงกล่าวสุนทรพจน์ ครบรอบ 70 ปีก่อตั้งสาธารณรัฐประชาชนจีน -ลิงก์ถ่ายทอดสด | The Thaiger
ต่างประเทศ3 weeks ago

สีจิ้นผิงกล่าวสุนทรพจน์ ครบรอบ 70 ปีก่อตั้งสาธารณรัฐประชาชนจีน -ลิงก์ถ่ายทอดสด

คลิปไฮไลท์วอลเลย์บอลเวิลด์คัพ 2019 นัดที่ 5 | The Thaiger
วอลเลย์บอล1 month ago

คลิปไฮไลท์วอลเลย์บอลเวิลด์คัพ 2019 นัดที่ 5

คลิปไฮไลท์ วอลเลย์บอลเวิลด์คัพ 2019 นัดที่ 1 | The Thaiger
วอลเลย์บอล1 month ago

คลิปไฮไลท์ วอลเลย์บอลเวิลด์คัพ 2019 นัดที่ 1

Paramount เตรียมรีเมค FACE/OFF หนังบู๊ระดับตำนาน | The Thaiger
หนัง1 month ago

Paramount เตรียมรีเมค FACE/OFF หนังบู๊ระดับตำนาน

ประยุทธ์ โต้ รัฐบาลไหนก็มีตำหนิทั้งนั้น “ถึงเวลาก็อ้างอย่างที่ผมอ้าง” | The Thaiger
ข่าวการเมือง1 month ago

ประยุทธ์ โต้ รัฐบาลไหนก็มีตำหนิทั้งนั้น “ถึงเวลาก็อ้างอย่างที่ผมอ้าง”

Trending