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How the bike-share start-ups fell over

The Thaiger & The Nation

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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



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IKEA Thailand launches full online store

The Thaiger & The Nation

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IKEA Thailand launches full online store | The Thaiger

“…it took IKEA about two years to study the market demand, develop the infrastructure, and prepare everything before launching their e-commerce service in Southeast Asia.”

by Kwanchai Rungfapairsarn

IKEA Thailand has announced the official launch of its IKEA Online Store as it gets set to better provide for individual customers across the Kingdom.

IKEA Thailand say the seamless online shopping experience will offer the same journey and impression customers get when they visit a physical IKEA store.

“We see the potential – it is a potential in Thailand for IKEA. We have only been accessible within Bangkok so far, and now we will be accessible for people from across the country,” Lacia Sherlock, the deputy retail manager for Thailand, Singapore and the Philippines, said.

“The delivery prices need to be affordable and all the services need to be accessible for consumers living outside of Bangkok, so that they are able to get the assembly or whatever they need.”

IKEA has developed the full e-commerce platform for modern shoppers providing a convenient channel to access it products and inspirations, 24 hours a day and from anywhere in Thailand.

Sherlock said it took IKEA about two years to study the market demand, develop the infrastructure, and prepare everything before launching their e-commerce service in Southeast Asia.

“We aim to provide an impressive online shopping experience similar to the shopping experience customers get when visiting our physical stores. The online store has been available in Singapore and Malaysia within Southeast Asia.”

“We are pleased to now be able to provide this access to Thais. We have been wanting to do this for a long time, along with providing them with a superior experience and inspiration through both of our two Bangkok stores,” said Sherlock.

IEA soft-launched its e-commerce service in Thailand on March 26 in order to test the system and procedures and ensure they were fully functional before yesterday’s official launch.

“We are looking at achieving 17,000 online orders this year. We believe that the IKEA Online Store will help strengthen IKEA Thailand and drive sustainable growth, as our popular in-store shopping experience is complemented by our new online offering.”

IKEA Thailand launches full online store | News by The Thaiger

PHOTO: The Nation

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Business

Watch out Thailand, here comes Vietnam

The Thaiger & The Nation

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Watch out Thailand, here comes Vietnam | The Thaiger

“Vietnam is poised to take advantage of the next wave of digital technologies such as blockchain, AI (artificial intelligence), internet of things and cloud-based services to become Asia’s next high-performing economy and improve the living standards of its residents.”

Dr Lucy Cameron, from Australia, lead author of the report “Vietnam’s Future Digital Economy Towards 2030 and 2045”, says the country should carefully navigate a number of risks while undertaking digital transformation. She was presenting her findings in Ho Chi Minh City yesterday.

“Vietnam has been one of the world’s fastest-growing economies and has already become one of the most dynamic countries in East Asia,” she said.

“A boom in digital hardware and software exports has occurred, and Vietnam’s young population is rapidly taking up new mobile internet services,” according to the report.

But the report also noted some challenges.

“The population is ageing, while climate change and rapid development is straining the environment and food production as the country rapidly urbanises. The workforce needs to learn higher-level skills, especially as jobs are becoming automated in the agriculture and manufacturing sectors.”

Australian Ambassador Craig Chittick said the report was the first major output of the Aus4Innovation partnership between Australia and Vietnam.

“It will guide our work over the next three years as we deepen the collaborative linkages between our two countries and help strengthen the Vietnamese innovation system as it adapts to the challenges and opportunities of the digital economy,” he said.

SOURCE: The Nation

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Business

“Very dangerous” Huawei could be part of a US-China trade deal

Kritsada Mueanhawong

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“Very dangerous” Huawei could be part of a US-China trade deal | The Thaiger

President Donald Trump has reiterated his complaints against China’s Huawei Technologies but conceded that they could be resolved as part of a negotiated US-China trade deal. Without providing evidence, he went on to call the Chinese telecommunications giant “very dangerous.”

The US has virtually banned firms from conducting business with Huawei, the world’s largest telecom manufacturer, citing unspecified national security concerns.

Despite the rhetoric President Trump predicts a quick end to the trade war with China. His bold prediction is not supported by any high-level talks being scheduled between the two countries since talks stalled two weeks ago.

Earlier yesterday, the US Secretary of State Mike Pompeo accused the CEO of Huawei, Ren Zhengfei, of lying about his company’s lack of ties to the Beijing government. Pompeo claimed the alleged ties “represented a security risk” to the US without providing any details.

Meanwhile, again without providing any specific examples or evidence, President Tump said Huawei was “very dangerous”.

“You look at what they’ve done from a security standpoint, from a military standpoint, it’s very dangerous. If we made a deal, I could imagine Huawei being possibly included in some form or some part of it.”

“The company is deeply tied, not only to China, but to the Chinese Communist Party. And that connectivity, the existence of those connections puts American information that crosses those networks at risk,” he is quoted as saying in a Reuters report.

Huawei has repeatedly denied it is controlled by the Chinese government, military or intelligence services. But tech companies around the world continue to fall in line with US curbs on the company. Japanese conglomerate Panasonic says it had stopped shipments of some Huawei components, a day after British chip designer ARM did the same, potentially crippling the Chinese company’s ability to make new chips for smartphones.

Meanwhile the US government is aiming to provide about $700 million in grants to help telecom providers with the cost of removing Huawei equipment from their networks, and to block the use of equipment or services from Huawei and Chinese telecoms firm ZTE in next-generation 5G networks.

They’ve also announced a $16 billion aid program to help US farmers hurt by the ongoing spat. The Agriculture Department says some funds will be used to open markets outside China to US products. Farmers have been among those hardest hit by the trade war.

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