OH RIGHTY! Here’s part 2 of ‘Seasonality & Public Holidays – How it Affects Business in Cambodia.’
By Christine Cheung & Tim Liu
In part 1 of this series we dealt with some of the potential issues that you would come across when dealing with seasonal cycles and holiday effects. You were given general insight into Cambodia regarding statistics, culture and some recent trends in local development. Part 1 was bleak, depressing, left your head banging against a brick wall and of course caution for would-be investors. It would probably get most people to think 'is Cambodia really for you in terms of investment.'
Rest assured, it's not as bad as it sounds.
Despite the doom and gloom from Part 1 of this article series, the question is knowing how seasonality and public holidays will affect business and how do we deal with it?
It just happens, you came to the right article XD
Well…At least Part 2, will have some solutions for the issues discussed.
It’s All About Long-Term Planning:
This might seem common sense to the most practical business owners, but I can assure you even some of the more established companies here do not actually have a long-term plan. Of course, some businesses are where they are due to a company’s agility to react to changes, but the larger your ship, the harder it is to change course. Now, put into consideration seasonality and public holidays are annual phenomenon, it is not going to disappear anytime soon so why are we not planning long-term?
Before starting your business year, Google is your best friend. As mentioned, in Part 1, May-Sept is considered to be low season. If you want the full list of public holidays and when they are going to happen, that's available online as well.
"...put into consideration seasonality and public holidays are annual phenomenon, it is not going to disappear anytime soon so why are we not planning long-term?"
Just because low season comes in, does not mean there is nothing to do. When dealing with low season, the idea is to plan well ahead...at least 1 year pre-planning, so that you fill this slow period with bookings or promote patronage.
If you are in hospitality or hotels industry that would be working with local or international tour agencies to pre-book and secure business. This of course is only one way. What about private bookings, what about events, what about loyalty programs, what about low season specials…the list goes on. Low season is not the time to be complacent but preparing yourself for next year.
Business development is what most business should be doing during low season. Figure out your core product/service offerings. Find ways to generate income that are complimentary to what you offer. Can I take on private catering events? Are we able to do delivery? Is there a way that I can consistently sell my products on a day to day basis through contract schemes? Is there a way to encourage greater patronage from local consumers?
Planning coupled with how well you know your own product and service can come a long way to get your business out of the negatives and into better shape for the peak season ahead.
Staff Are Core to Your Business:
Just because the basic minimum wage is low in Cambodia, does not mean that your staff are expendable. For every time you lay off staff that you have spent time and effort training is ‘time cost,’ added in training someone new.
We need to balance between satisfying the needs of the staff and the business. Unfortunately, in Cambodia, workplace relations standards, education and professionalism are some factors that still have room for improvement.
"For every time you lay off staff that you have spent time and effort training is ‘time cost,’ added in training someone new. "
But this goes both ways; it also has to do with the expectations. If you as the employer are coming from a developed country, with extensive labour laws, professional standards and systematic ways of doing things, why not spend the time and train your staff?
Staff themselves need to recognise that if they look after the business then the business will look after the staff. If the business shuts down, it’s not good for anyone. Conversely businesses need to recognise their employees and reward those that are performing exceptionally in a workplace environment. It can be some sort of monetary reward or internal recognition. If you do not have such a system in place there is also the Cambodia Outstanding Employee Awards (COEA), which recognises employee excellence at a national level.
Localising for Your Clientele:
Ignoring the local market, and only selling to a specific demographic of consumers is an unsustainable strategy, that is subjected to the whims of geopolitics, the world economy and the issues discussed in Part 1. YOU’RE IN CAMBODIA, ADAPT LOCALLY…
Adapting locally means understanding the culture, the needs, trends and language of the country you are working in. You cannot expect to open a business and not have printed collateral in the local language. Do the research! Find out what channels of promotion works for you.
"Focus on the channels that are consistent with your products or service. Marketing does not have to cost you an arm or a leg."
Using a shotgun approach in marketing can give you some brand visibility, but in Cambodia social media platforms such as Twitter do not have the same importance as it does in developed countries. Focus on the channels that are consistent with your products or service. Marketing does not have to cost you an arm or a leg.
When communicating, do not assume that everyone is well versed in English. Finding good local staff that can communicate in the language that you work in is one thing but asking them to translate professionally is another. The problem lies with that fact that there is a possibility that the staff may not understand industry specific terminology. This is when you may need to consider a professional translation company like Simili Translation Services.
Simili carefully screens their translators to ensure that translations are at a professional level. Each translator is specialised with specific fields, which means medical industry translators would not be handling anything to do with finance. Furthermore, after a translation is done a second translator will do the proofreading to ensure accurate translations each time.
Knowing When to Diversify
A general rule of thumb to follow is that depending on the product/service, local consumption is consistent, foreign consumers are inconsistent. A good bulk of your business should rely on domestic demand. If you have already built a loyal group of consumers that frequent your establishment a few times throughout the month, then diversification will bring you the extra numbers.
"Ask yourself: do my products appeal to their consumption behaviour? Is what I offer now applicable or do I need to make changes? What can I do to make spending experience easier for these new consumers?"
Diversification is a term that is applicable to products/services, communication, target market and more. It’s a full package and integrated approach when dealing with a new consumer demographic that you are planning to sell to. When planning to diversify your consumer scope, research and preparation is key. Examine what your new markets consumption behaviour is.
Ask yourself: do my products appeal to their consumption behaviour? Is what I offer now applicable or do I need to make changes? What can I do to make spending experience easier for these new consumers? Now consider how can we plan to attract these customers.
If they are foreign consumers, then you would need collateral in their language. Brochures, restaurant menus, instructions, signage and more…All these elements need to be visible to the consumers that you are targeting. Take it a step further, consider how China is now a near cashless country, then it would make sense to have a payment system that supports Alipay, Wechat pay or at least the bare minimum a card machine that accepts Unionpay.
Let’s think about promotion. REALISE...not everyone uses Facebook or WhatsApp. Japanese consumers prefer to use Line as the app for communication. The Chinese uses Weibo or Wechat. You might be thinking "THANKS FOR THE TIP!" Then proceed to make a strategy to promote on these various channels. However, it's a waste of money for Cambodian SMEs to build a dedicated company page on these platforms.
First off, you're increasing your marketing costs, by investing into these platforms. Secondly, you would probably need full-time personnel to deal with the clients in these additional language environments. Furthermore, how do you gauge the quality of service and communications. What about the content that you generate for social media or promotion?
All this takes time...
Wouldn’t you rather be spending more effort in providing genuine service and exceptional quality offerings to your clients than worry about these matters?
The Bottom Line
At times like these you need some help, and consultancy’s like CAMBC definitely have the specialists to deal with the type of issues mentioned in this article series. It’s about maximising your ROI so that you can effectively budget and reach the relevant consumer groups so that you have time to ensure the quality and service of your core offering.
Furthermore, other services we provide include business start-up services, special licensing applications, legal, accounting, investment and more...
This is what Collective Asian Markets Business Consultancy (CAMBC) can do for you.