As digital transformation across the world becomes impossible to ignore and necessary to remain competitive, both small and big businesses are increasingly adopting emerging technologies to enhance their value to their customers while ramping up productivity and efficiency, according to a recent report.
However, the Malaysian restaurant industry (one of the leading industries in the country) is apparently lagging in its digital journey, prompting several companies to form a collaboration to remedy the situation.
The initiative, known as Growth Malaysia, is spearheaded by the leading mobile O2O platform in Southeast Asia. It is aimed at helping 100,000 offline food outlets across the country adopt digital solutions in all aspects of the business; including payments, marketing, data, and financial services.
Encouraging restaurants to get on board
The founder and CEO of the platform noted that consumers in Malaysia are growing increasing digitally savvy. In fact, 22 million out of the 32 million people in Malaysia have smartphones. Thus, the penetration rate is quite high.
Moreover, since the Malaysian public is sufficiently digitized, businesses should be brought up to speed especially the small and medium enterprises (SMEs) that contributes up to 37 per cent of the country’s GDP.
To do so, the CEO noted that the front end of a restaurant would be a great starting point for a business to adopt a technological solution such as electronic payment platform or modern POS system, where the consumers are already able to pay and order using their mobile phones.
Moreover, restaurants could reward their customers using a digital loyalty card app, distribute coupons and promotional items and reach greater market access.
Following this, businesses can then begin to implement technology to their backend operations, as well as sourcing for produce.
However, the company realises that it cannot take on the project alone. Thus, while the firm has promised to help with some part of the digitization’s journey, the process necessitates the involvement of other companies and government agencies. Nonetheless, the company is recruiting others to help them out in their digitalization mission.
Growth Malaysia’s other strategic digital partners include the leading ride-hailing firm in the region, Maybank, Malaysia Digital Economy Corporation (MDEC), and others.
Data-driven initiatives
By going digital and signing up with digital partners that process mobile payments and loyalty programs, restaurants would be able to collect important data on customers and general performance of the business.
According to the CEO, this is what could help restaurants get credit from banks. He noted that in order to obtain a loan, applicants require three years of financial records, but most businesses in the food and beverage industry fold within three to five years.
Restaurant owners require a few years to build a good brand image. However, within those years, they can’t get any access to funds or financial services and this triggers the vicious cycle of banks being averse to lending to restaurants due to high risks and restaurants failing due lack of funding.
This is where data will be invaluable for the restaurant industry whereby within the first few months a restaurant’s digital partners (like the O2O platform or the ride-hailing app) would be able to generate data and gather insights on the restaurant’s performance to obtain a line of financing.
With financial providers and government agencies present within the Growth Malaysia initiatives, the potential for a revolutionary breakthrough is endless.
Beyond that data would also businesses to always stay relevant to the current trends and market signals, especially when in the food industry.
On the whole, digitisation appears, initially, to be a luxury to many businesses. In other cases, enterprises who are thinking about digital transformation may not know where to start.
However, thanks to initiatives like Growth Malaysia, businesses seeking to fulfil their business potential and serve their customers better or just to ensure their very survival can easily access help and advice.
