The Key problem of adm@rt's failure, i don't believe that's because Hongkongness's shopping habit.

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The Key problem of adm@rt's failure, i don't believe that's because Hongkongness's shopping habit.

Post  ChenYun on Fri Sep 23, 2011 12:01 am

I am rethinking the adm@rt's problem. As we concluded in the classroom that maybe the EC model is not suitable for HongKong therefore even Jimmy Lai invested billions of money into the adm@rt, it was still a lacking of condition business..

However, i noticed when adm@rt was still operating at that time, the phone orders were abundant and call center cannot satisfy the demand. If Hongkong is too small and convenient so that there's a no need of EC but just by shopping outside of home is ok, why did the phone orders turn to be continuous? Actually in Hongkong, the internet services are as convenient and universal as the phone call services, if you feel easy to phone shopping, why not electronic shopping too, for that the EC might get some more advantages in product display and classification.

So i am a little bit doubting about the key problem is not the Hongkongnese's shopping habit but the operation of adm@rt and the implementation of its core strategy in the real business world. As Jimmy Lai is famous for his past success in many traditional industry while however, there's a lack of experience in EC and he was also aiming too high. Even now after several years the EC model is still exploring, so at that time it took great risk to start the adm@rt business. Lai expanded adm@rt at a too high speed and too big scale, this is not only make the adm@rt facing a shortage of resource to operate but also annoying a lot of traditional FMCG retailers like wellcome, even Lai cannot handle all these situations, and which eventually led to the failure of adm@rt.


Chen Yun (Peter Cool 11250690123)

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Hi, maybe the reason for existing EC order in adM@ is the cheap price

Post  zhangmingmin on Sun Sep 25, 2011 1:16 am

In my assumption, the existing orders of adM@ are mainly sent by low-income people in Hongkong. adM@rt's products are labeled at lower price than the same kind product in other shops. And low-income people would be price-sensitive, so they would like to order products from adM@rt. But the low-income popolation in Hongkong is just 10% of total population in hongkong, about 70-80 thousands. Such a small purchasing power could not support adM@rt's business development.

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problems about low price

Post  pengyaoGB on Mon Sep 26, 2011 12:39 am

adM@rt could not only strived for lower price blindly. Unfortunately it involved in fake good issues because of the lower price,which affected its fame.
Having strong competitors like Park’n Shop stores and Wellcome, adM@rt was at a disadvantage of market share. The big two of the market could easily offer lower price than adM@rt . And in the retailing market, competitors offered almost the same products and services. If you offered goods at higher price, customers would not choose you and go after cheaper ones.
So offering lower price could not be the strategy of adM@rt because it did not have the ability. If you can’t be cheaper, you should offer something new or different.

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Re: The Key problem of adm@rt's failure, i don't believe that's because Hongkongness's shopping habit.

Post  YeYing2011960944 on Thu Oct 06, 2011 11:07 pm

I partly agree on your opinion. From the case I don't think Lai was a good CEO. But he still is sensitive to the trend of market and a great explorer.
Although there were abundant telephone orders to Adm@rt at that time, there were still not enough to makeup its investement and said nothing of its poor call center service quality and shortage of staff that could not meet the market demand.

Anyway it truly maybe a good chance for Lai if he explored its potential market to Shenzhen, and to other mailand cities as well by using strategy of product differentiation, such as the high-quality, duty-free imported products.

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Re: The Key problem of adm@rt's failure, i don't believe that's because Hongkongness's shopping habit.

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