The game in Asia these days is domestic consumption, as millions of Chinese, Indian and Southeast Asian consumers continue to expand the ranks of the middle class. Internet company Travelzoo Asia Pacific, a licensee of Nasdaq-listed Travelzoo Inc., has been riding this wave with its ?This Week?s Top 20? product, a compilation of travel deals that is sent to 3.5 million subscribers across the region.
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Last year, the company launched a group buying product called ?Local Deals,? joining Groupon in working with merchants to offer discounted deals over the Internet in the region. ?The transaction volume is pretty good,? reports CFO Honnus Cheung, who puts the number of buyers at 5% to 10% of subscribers. A group buying voucher for a crab feast dinner at the Prince Restaurant in Hong Kong recently generated US$120,000 in revenue.
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Cheung spoke to CFO Innovation?s Cesar Bacani about financial management and talent development in the Internet space, Travelzoo?s fast-changing business model and other issues. Excerpts:
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You were with American Standard before becoming Regional Finance Director of Yahoo! in 1999 and now CFO of Travelzoo Asia Pacific since 2007. How different is financial management in the Internet space as opposed to a brick-and-mortar company like American Standard, which makes bath and kitchen products?
They are different. ?In the Internet/e-commerce industry, it is more dynamic, where you can?t see the product, and there?s no standard bill of materials or SKU [stock-keeping unit]. The control process for the Internet industry is quite different than in the manufacturing industry.
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When I was the CFO at a manufacturing business, I had to be more conscious about the bill of materials and standard procedures for every process. For example, let?s say, minimizing wastage is very important [so there are procedures on] how to cut metal sheets, and how many minutes it should take [for the product to move] from the 1st work station to the 15th work station. Increasing productivity and turnover speed and minimizing physical inventory are the keys to winning in manufacturing.
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This is very different compared with Yahoo! or Travelzoo. When your business partner says ?I want to launch this product? or ?I want to acquire that company,? you can?t think about it from the financial control perspective. You need to use your imagination to map out a process and ascertain whether this acquisition can maximize the future stream of profits or market share. You need to be very flexible, dynamic, and innovative. You will always have the chance to set precedent. The strategic partnership of Yahoo! China and Alibaba is an example of setting precedent in the industry.
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The product life cycle in some of the Internet industry can be very short. That?s why we need to hire people who are quick learners because they will understand the dynamic business model and products in a much faster pace.?
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So it would seem that the type of finance professionals Internet companies would be looking for would be different from those in other companies?
Firstly, they need to enjoy surfing the web. Let?s say, if I publish an online campaign, they need to assess at which point the revenue can be recognized. If this finance professional is computer phobic, he cannot collect the evidence in supporting the revenue recognition.
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Sometimes, we need to benchmark and gather industry practice online. That also takes a lot of research work on the web. In addition to being Internet savvy, they need to be adaptable to new products in order to effectively communicate with peers in the company, including the sales managers, product managers and engineers, in order to gain their respect.?
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Source: http://www.cfoinnovation.com/content/internet-cfo-insights-online-finance-pioneer
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উত্তরমুছুনWeb Design Bangalore For all of its importance and impact, the Internet of Things (IoT) enables, rather than determines an organization’s strategy.
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