The Times Australia
News From Asia

.

A.S. Watson’s Move to Invest USD400M in Supply Chain Transformation Has Strengthened its O+O Capabilities and Competitive Position During the Pandemic

HONG KONG SAR - Media OutReach - 25 August 2022 - A.S. Watson Group has gained widespread and overwhelming recognition in the retail industry in Asia, winning eight regional and local accolades, including Health & Beauty Retailer of the Year - Asia Award and Omnichannel Strategy of the Year Asia Award, by Retail Asia.

The Group's flagship brand Watsons has also been voted Asia's No.1 Pharmacy/Drugstore Brand by Campaign Asia for 13th consecutive year. Meanwhile, it is recognised as Digital Transformation Pioneer Company by WeChat in Mainland China last year. At the recent interim results announcement of CK Hutchison, parent company of A.S. Watson, the world's largest international health and beauty retailer reported 22% increase in revenue in its Asia operation and 13% in Europe. What's behind the resilience of A.S. Watson in tackling the pandemic challenges in retail in the past two years while gaining in competitive position?




React to Challenges with Laser Focus on People

Malina Ngai, CEO of A.S. Watson (Asia & Europe), reflected on the key lessons learned, "There is no instruction manual for how to lead at a time like the COVID-19 pandemic. We are fortunate that what we believe in - loving our people and customers, and the offline and online (O+O) platform strategy we have been building - plays its most critical role during the crisis."

"We believe in loving and caring for our people. We have 130,000 colleagues globally with majority of them work in our physical stores. From the beginning of the crisis for over 30 months now, we assured them we prioritized our efforts on their health and safety, proactive communications, and provided financial security even during market lockdowns. This has helped to keep our people together to fight the pandemic in high spirits."

As part of the company's focus on people amid the ongoing pandemic challenges, A.S. Watson has strengthened its commitment to inclusion and diversity and sought to expand its understanding of women's needs, so as to improve the lives of its people as well as customers. It has also recently announced its plan to offer 200,000 job opportunities worldwide for young people by 2030, enabling them to gain valuable experience to develop their career in retail.

USD400m Investment in Supply Chain Transformation Pays Off

Since 2012, A.S. Watson Group has been driving its digital transformation with anticipation of evolving customer needs in shopping for health and beauty products. Besides investment in digital technology, retail systems and automation, big data, cloud technology and cyber security, the transformation in building O+O retail supply chain pays off during the pandemic.

Ngai explains, "Supply chain is the backbone for us to deliver seamless O+O customer experience. During the pandemic, we were able to quickly adjust our global operations to handle the surge of online orders through activating fulfilment in over 50%, and pick-up in almost 100% of our 16,000 physical stores network, multiple delivery options with 30-mins delivery being the fastest standard."

"We do not have a crystal ball on a crisis outbreak like the pandemic. But we have a vision a decade ago to build our business into an integrated O+O platform to serve our customers hence we know we need to create a customer-centric supply chain network. We now have a network of close to 90 main warehouses and invested over USD400m in the past decade to transforming planning and demand forecasting tools, capabilities in real-time inventory visibility, improving supply chain productivity and capacities. It enables our agility to operate and pays off during the challenging pandemic period to keep us in business in a competitive way."

Customer Love is an Important KPI in O+O Strategy

In a retail business, how important is customer love, and how can this be measured?

"Like any business, measuring traffic, transactions, conversion, active shoppers, and ultimately sales and profit is a must. But there is more," Ngai continues.

"We've been working to build a lasting and close relationship with our billions of customers who shop with us every year, amongst which 142 million of them are loyalty members. Customers are more emotionally demanding for relevance, care, and personalization, so we need to show them that we understand, we care, and we want to stay connected to them."

"We no longer use traditional mystery shoppers. Why not ask our real customers! We conduct monthly customer survey in all operating markets, called Customer Love Score. The feedback on our O+O experience has improved from 87 to 90.5 out of 100 in the last 3 years. Last year alone we received over 4 million responses from customers who shopped with us offline and online. Over 60% of them rated us 100. We have added Customer Love Score as a KPI in all businesses to reinforce our company purpose to put a smile on our customers' faces today and tomorrow."

Looking ahead, online retailing will continue to stay as part of customers' shopping habit. At the same time, the pandemic underlines the desire among customers for human connection. Physical retail must evolve to serve customers with human touch, friendly services, and interactive experiences of products; while fully integrated with online and relevant digital experiences to provide relevant O+O choice for customers.

"Our focus on further strengthening the O+O platform strategy at A.S. Watson stays solid in the very volatile and complex world. We will further accelerate our supply chain transformation to support our growth, specifically in warehousing capacity and automation technologies, last mile delivery experience, AI in inventory management and demand forecasting. And we are keen to build international partnerships with companies who have expert experience, products and solutions in supply chain."

Hashtag: #ASWatson

Times Magazine

Headless CMS in Digital Twins and 3D Product Experiences

Image by freepik As the metaverse becomes more advanced and accessible, it's clear that multiple sectors will use digital twins and 3D product experiences to visualize, connect, and streamline efforts better. A digital twin is a virtual replica of ...

The Decline of Hyper-Casual: How Mid-Core Mobile Games Took Over in 2025

In recent years, the mobile gaming landscape has undergone a significant transformation, with mid-core mobile games emerging as the dominant force in app stores by 2025. This shift is underpinned by changing user habits and evolving monetization tr...

Understanding ITIL 4 and PRINCE2 Project Management Synergy

Key Highlights ITIL 4 focuses on IT service management, emphasising continual improvement and value creation through modern digital transformation approaches. PRINCE2 project management supports systematic planning and execution of projects wit...

What AI Adoption Means for the Future of Workplace Risk Management

Image by freepik As industrial operations become more complex and fast-paced, the risks faced by workers and employers alike continue to grow. Traditional safety models—reliant on manual oversight, reactive investigations, and standardised checklist...

From Beach Bops to Alpine Anthems: Your Sonos Survival Guide for a Long Weekend Escape

Alright, fellow adventurers and relaxation enthusiasts! So, you've packed your bags, charged your devices, and mentally prepared for that glorious King's Birthday long weekend. But hold on, are you really ready? Because a true long weekend warrior kn...

Effective Commercial Pest Control Solutions for a Safer Workplace

Keeping a workplace clean, safe, and free from pests is essential for maintaining productivity, protecting employee health, and upholding a company's reputation. Pests pose health risks, can cause structural damage, and can lead to serious legal an...

The Times Features

Exploring the Curriculum at a Modern Junior School in Melbourne

Key Highlights The curriculum at junior schools emphasises whole-person development, catering to children’s physical, emotional, and intellectual needs. It ensures early year...

Distressed by all the bad news? Here’s how to stay informed but still look after yourself

If you’re feeling like the news is particularly bad at the moment, you’re not alone. But many of us can’t look away – and don’t want to. Engaging with news can help us make ...

The Role of Your GP in Creating a Chronic Disease Management Plan That Works

Living with a long-term condition, whether that is diabetes, asthma, arthritis or heart disease, means making hundreds of small decisions every day. You plan your diet against m...

Troubleshooting Flickering Lights: A Comprehensive Guide for Homeowners

Image by rawpixel.com on Freepik Effectively addressing flickering lights in your home is more than just a matter of convenience; it's a pivotal aspect of both home safety and en...

My shins hurt after running. Could it be shin splints?

If you’ve started running for the first time, started again after a break, or your workout is more intense, you might have felt it. A dull, nagging ache down your shins after...

Metal Roof Replacement Cost Per Square Metre in 2025: A Comprehensive Guide for Australian Homeowners

In recent years, the trend of installing metal roofs has surged across Australia. With their reputation for being both robust and visually appealing, it's easy to understand thei...