MANILA -- Over coffee at his shopping mall that faces Manila Bay, the late billionaire Henry Sy told the would-be president of his retail empire to focus on the behavior of shoppers.
A few days into his new role, SM Supermalls President Steven Tan said being observant of how shoppers behave could help him run the business, taking inspiration from the founder of shopping mall culture, called "Tatang" by those close to him.
"Tatang, he has always asked us to be very observant of the shoppers and what’s happening around you… that would definitely affect how you run your business," Tan said in an exclusive interview with ANC's The Boss at SM Megamall, which recently got a major facelift.
Plucked from his hotelier job in Shanghai, Tan joined the SM Group in 2004 and shared regular afternoon coffee with the Sy patriarch in SM Mall of Asia.
Lessons from the daily hour-long coffee sessions with the late SM founder was "more than an MBA," Tan said.
"We would talk for an hour to tell me how he opened Mall of Asia, how he envisions it, how he opened Megamall and North Edsa and how’s the behavior of the shoppers. Those are all things I feel that are valuable in how I could and with how I’m running this company nowadays," Tan said.
Clad in classy suit jacket, shirt and shoes, Tan led the SM Group's expansion into luxury, with SM Aura Premiere in Taguig City and the Fashion Hall that revitalized Megamall.
Tan misses Tatang "a lot" as the retail empire deals with the effects of the new coronavirus outbreak in China. For the late Sy, the safety of shoppers and suppliers takes precedence over business especially in times of calamities, Tan said.
“Safety first. Safety of our employees and our suppliers. Tatang, he feels that by protecting your own employees and protecting your suppliers, this will naturally go back to you…He would always remind us to take care of our business partners and not just business, business, business,” Tan said.
Even before the Sy patriarch's death in January 2019, SM had set a succession plan that saw non-relatives take leadership positions. It's a move aimed at professionalizing the ranks.
The patriarch's long-time CFO, Jose Sio, took over as chairman of the SM holding firm, SM Investments. Sy siblings Teresita Sy-Coson, Henry Sy Jr and Harley Sy serve as vice chairperson of the board, vice chairman of the board and executive director, respectively.
SM has 74 malls in the Philippines, with Megamall and Mall of Asia among the biggest. It also has 7 malls in China, with plans to build an eighth.
Malls are a constant fixture in the Philippines, giant air-conditioned refuges from traffic gridlocks, humid weather and monsoon rains. Many malls, including SM, offer church and government transactions on top of food and shopping.
Strengthening its e-commerce presence while expanding physical retail space will prepare SM for the future, he said.
"Online business is still a very small portion of the whole retail [industry]. It’s even less than 5 percent. We’re doing that in preparation for, in times when online shopping is very prevalent so that we’re ready, Tan said.
The company plans to open 17 new shopping malls in the next 2 years, 4 this year, 6 in 2021 and 7 in 2022, most of them outside Metro Manila.
Reaching the 100-mall mark by 2024 is "very possible" with the rate of brick and mortar retail sales growth today, he said.
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