Copycat Businesses

[Razzler1973]

His wife has done nothing wrong, if someone is so silly to give away information for no benefit them good for her. It's not like she's opened up next door either, she's back in her village doing it and rightly not telling anyone any info.

The copycat businesses tend to be ones that don't require a great deal of thought to open so it's easily understandable. Noodle shop beats dot.com start up anyday!

Also, if people are in a particular area to buy mobile phones and various add ons then give them the option to go to a different place nearby to do the same thing. Shop A is in a mall with people strolling about everywhere, dam_n right I am getting in on that!

It's like Burger King used to open up right in the areas where McDonalds were. If people are thinking of buying a burger then give them an option.

Not sure just how many game shops are needed in some streets though but how much do fruit sellers need to sell to really make it worth while, hardly huge overheads so an easy business to get into I would imagine

[mca]

With the plethora of copycat businesses in Thailand there must be room for a facility where you can go and xerox a dog. I've never seen one. Now there's an opening.

[farang000999]

The only thing surprising is that the copycats don't get shot.

[Thinkingofachange]

I think some people in this thread should listen to this podcast: http://www.npr.org/templates/story/story.php?storyId=121304873

[Mosha]

It's not the fact they copycat, but they do it right next door. Sell the exact same items/brands and at the same prices.

[brit1984]

It's not the fact they copycat, but they do it right next door. Sell the exact same items/brands and at the same prices.

Setting up next door is often a rational economic decision as the entrepreneur already knows the demand is there, and being next door maximises the share of that demand that they can take (without having to risk making any untested changes to a business model that has already been proved to work by the first mover).

For example imagine there is a guy selling ice creams on the beach from a kiosk. If he is the first to set up he should set up his kiosk in the middle of the beach, giving him the best chance of servicing 100% of the beach (assuming the beach goers are evenly spread across the beach). If a second ice cream vendor decides to sell ice creams on the beach, he should set up right next to the first guy in the middle of the beach, so he can take 50% of the customers. If, on the other hand, he set up at one end of the beach, 75% of beach goers would still be closer to the first guy and the second guy will only take a 25% share.

[Heng]

Easy, if someone opens up the same business next to you, tell them you already called 'dibbs.' If you can't compete and go out of business because they handle their cash flow, overhead, marketing, etc. better than you.... just call a 'do over.'

Sorted.

[jackinbkk]

I think the fact many fail to grasp is that copying is a natural behaviour in all parts of life.

It's actually a survival instict. It is far easier to let another individual take a risk and then to copy them if the risk pays off. It is for this reason that 'trends' exist. Fashion, food, computers, the internet. You name it. There are certain things that become popular and it is due to human nature.

Early on it would have involved copying others for things like trying new foods. Babies watching what their parents do for survival. Its a way of teaching and learning.

It can of course be self defeating. It's widely studied in the animal kingdom. In fact there are some animals that also use deception. Like the Jay bird which will pretend to bury food in front of others but later hide it somewhere else.

http://news.bbc.co.uk/1/hi/sci/tech/8035950.stm

[wana]

It's not the fact they copycat, but they do it right next door. Sell the exact same items/brands and at the same prices.

Setting up next door is often a rational economic decision as the entrepreneur already knows the demand is there, and being next door maximises the share of that demand that they can take (without having to risk making any untested changes to a business model that has already been proved to work by the first mover).

For example imagine there is a guy selling ice creams on the beach from a kiosk. If he is the first to set up he should set up his kiosk in the middle of the beach, giving him the best chance of servicing 100% of the beach (assuming the beach goers are evenly spread across the beach). If a second ice cream vendor decides to sell ice creams on the beach, he should set up right next to the first guy in the middle of the beach, so he can take 50% of the customers. If, on the other hand, he set up at one end of the beach, 75% of beach goers would still be closer to the first guy and the second guy will only take a 25% share.

that may have some merit ,but many people approach a beach from 1 end or the other ,i think being at the end would get closer to 33% of customers than 25% because people arriving at the beach and leaving from that direction can get an ice cream without going all the up to the middle where the busiest ice cream seller shall be

i suppose if you can set up next door to another business and do the exact same thing they "seem" to be making lots of money doing then why not ......

there doesnt seem to be any law against it and nobody seems to complain if theres 20 bars in a row or 60 shops to buy bus tickets on khao san rd etc

[DavidSL]

I don't know if anyone has mentioned this, but I've noticed a couple of times at least the direct rivalry between Big C and Tesco Lotus. Where I live we had a Tesco Lotus go up in the perfect location, right in the middle of a no-shop zone. A few months later, a Mini Big C went up right next door. I've seen this happen with a Tesco Lotus and 7/11 near the airport, too, and I predicted that one happening as soon as the first building went up. It's easy to see the reasoning behind it, I think in the West we've come to learn more and more about fair business practice and being original, it's not something they get taught here, it seems. I wouldn't risk opening any business here if it wasn't something I knew only I could do, or at least something I could make enough money from to move on to a new location down the line.

[mca]

I've always found Big C to be a bit "pikey" compared to Tesco Lotus.

[jackinbkk]

This should be of interest. I have copied the link below:

http://www.economist.com/node/21554500

[Payboy]

Wife put in a milk shake stand in front of the house, within a month there were 8 milk shake stands in the village [400 houses] Never hurt her profits as we make farang milk shakes,[ what ever they are] Kids come from miles around to have a farang milk shake. Jim

Jim, now you have me worried. Latex looks like milk

That might make them a bit chewy. Jim

Not to mention your shit bouncing back on you.

[wana]

I've always found Big C to be a bit "pikey" compared to Tesco Lotus.

theyre both a bit pikey if you compare them to villa or tops etc

[mca]

V, True. Sadly my local Villa is 450k away. Tops is nearer but I have to fight my way through a shopping mall of wandering locals a la Dawn Of The Dead which is a daunting prospect.

[wana]

V, True. Sadly my local Villa is 450k away. Tops is nearer but I have to fight my way through a shopping mall of wandering locals a la Dawn Of The Dead which is a daunting prospect.

Tops is not much better than lotus or big C i think ,it just looks more expensive so i think attracts less thais

prices and food quality are very similar

Villa seems to have some higher quality products but prices a bit higher to match

Theres other "premium" super markets around bkk ,cant remember all their names but imported products like

cheese ,meats ,beers ,wines and specialty items have a nice hefty price tag on them

i like german and belgian wheat beers personally and they are around triple the price of a thai beer and the biottle is half

the size too but its only money ,eh

[mca]

Villa seems to have some higher quality products but prices a bit higher to match

Theres other "premium" super markets around bkk ,cant remember all their names but imported products like

cheese ,meats ,beers ,wines and specialty items have a nice hefty price tag on them

Tell me about it. Last time I was in Bangkok there was a Villa just across the street from where I was staying. One evening I thought "I'll just pop over there and get some munchies for the drive home tomorrow"

Walked out 4000 baht lighter and no alcohol purchased.

[xthAi76s]

Villa seems to have some higher quality products but prices a bit higher to match

Theres other "premium" super markets around bkk ,cant remember all their names but imported products like

cheese ,meats ,beers ,wines and specialty items have a nice hefty price tag on them

Tell me about it. Last time I was in Bangkok there was a Villa just across the street from where I was staying. One evening I thought "I'll just pop over there and get some munchies for the drive home tomorrow"

Walked out 4000 baht lighter and no alcohol purchased.

I agree.

Thailand has done an EXCELLENT job of setting up the country's economy for export. They also have done a good job at protecting local industry with some of the highest import tariffs in the world.

However, where they've failed (at least from the perspective of most Westerners, Japanese, Koreans; people relatively wealthier) is that their local industry is mostly crap. Clothing is mostly crap. Food other than regular Thai food is mostly crap. Electronics are certainly crap -- think AJ, for example. This encourages us to purchase imported stuff which is often taxed at more than 100% of it's shipped cost.

IF Thailand had done a better job of being competitive and creating better products, we'd feel much less (although not zero) desire to buy imported goods.

Think of the US, for example -- I don't know much about the UK -- where imported goods are also often considered 'luxury' and taxed (albeit generally lower than imported goods in Thailand) and are often significantly more expensive. For example, think 'imported Italian leather'.

The major difference in the US and other economies is that those other, non-Thai economies generally have reasonably competitive products in just about every category. The US has pretty good quality everything. Same with Japan. Same with most Western European countries and even Australia. I mean, China is even getting there. You can find very nice quality clothing, traditionally Western food (like cheeses and sausages, just as examples) in Shanghai.

Thailand did a great job protecting the ability of their local industry to try to grow, but for whatever reasons (education, lack of support from the government, laziness, culture that does not encourage competition, etc) they have done a terrible job of creating any industries (aside from a handful) where they can satisfy quality needs of 1st world-ers. This is what is so frustrating. Most of us MUST look outside Thailand if we really desire a certain level of quality.

[BigJohnnyBKK]

Thailand did a great job protecting the ability of their local industry to try to grow, but for whatever reasons (education, lack of support from the government, laziness, culture that does not encourage competition, etc) they have done a terrible job of creating any industries (aside from a handful) where they can satisfy quality needs of 1st world-ers.

Businesses here don't need to focus on quality because it's not required by their market, only when designed for export is the extra cost justified.

Thai customers only care about appearance, reputation and (usually most of all) cost. Most are not qualified to make any judgment on inherent quality, and of course the restrictive libel/slander laws wouldn't allow for any consumer-reports style service giving objective evaluations.

I'd personally much rather have cheap clothes and shoes than pay extra for quality.

Things that are only in demand by expats aren't usually worth a decent-sized company paying attention, but e.g. foodland's locally-sourced butchery/deli products aren't bad.

[DowntownAl]

There is a street corner in Toronto (Queen and Broadview I think) that has a Starbucks, a Tim Horton;s (a Canadian icon coffee/donut shop), a Timothy's (a knock off Starbucks/Tim Horton's hybrid) by yet another Starbucks. I was taking a market research course a number of years ago when the question, "how does Burger King do their market research when they choose a new location?", was asked. After a few minutes of guessing and creative ideas by the course participants, the instructor answered, with deadpan sincerity, "they look for the local McDonald's and open up across the street." Simple and cheap.

It happens everywhere.

[xthAi76s]

Thailand did a great job protecting the ability of their local industry to try to grow, but for whatever reasons (education, lack of support from the government, laziness, culture that does not encourage competition, etc) they have done a terrible job of creating any industries (aside from a handful) where they can satisfy quality needs of 1st world-ers.

Businesses here don't need to focus on quality because it's not required by their market, only when designed for export is the extra cost justified.

Thai customers only care about appearance, reputation and (usually most of all) cost. Most are not qualified to make any judgment on inherent quality, and of course the restrictive libel/slander laws wouldn't allow for any consumer-reports style service giving objective evaluations.

I'd personally much rather have cheap clothes and shoes than pay extra for quality.

Things that are only in demand by expats aren't usually worth a decent-sized company paying attention, but e.g. foodland's locally-sourced butchery/deli products aren't bad.

Funny, after posting this, I thought the same thing. The market here (Thai market, anyway) doesn't demand it. Although, to be fair, most wouldn't know any difference because they've rarely, if ever, had exposure to the better quality. However, those Thais who are fortunate enough to live abroad, in my experience, usually do tend to gravitate towards and desire better quality products. Not always, but of the many I know, most do complain about this very issue of Thai quality vs many of their foreign competitors.

But, yes, I do agree that the vast majority of Thais care mostly about appearance. There's a particular Thai expression for this -- it means creating a picture -- but I cannot 'put my finger on it right now'. Too bad for us foreigners who desire the extra quality as we'll continue to 'pay through the nose' for it as long as the Thai market stays where it is. In other words, we'll be paying what we consider exorbitant prices for the foreseeable future.

EDIT

One thing neither of mentioned is that in most countries economies demand for quality has seemed to rise in lockstep with the populations wealth/purchasing power. In Thailand, perhaps, that is not the case partially because the rise in wealth over the last couple decades is centered in the hands of so few (read: one of the largest wealth gaps in the world). Even in China, consumers are starting to demand quality in their products. And, there are frequent stories of Chinese companies being publicly berated by Chinese consumers for poor quality goods. That does not seem to happen in Thailand at all.

Edited May 24, 2012 by xthAi76s

[xthAi76s]

There is a street corner in Toronto (Queen and Broadview I think) that has a Starbucks, a Tim Horton;s (a Canadian icon coffee/donut shop), a Timothy's (a knock off Starbucks/Tim Horton's hybrid) by yet another Starbucks. I was taking a market research course a number of years ago when the question, "how does Burger King do their market research when they choose a new location?", was asked. After a few minutes of guessing and creative ideas by the course participants, the instructor answered, with deadpan sincerity, "they look for the local McDonald's and open up across the street." Simple and cheap.

It happens everywhere.

Yes, it does happen everywhere, but, again, the issue that we are identifying with these Thai mom and pop shops in particular, is that they often don't do well at all. Also, they are not multinational rich, heavyweight companies with brand images and brand recognition to worry about, so your example is really not all that relevant here. If these Thai businesses did well, then their copycat practice would be valid in that regard. But, the simple truth is that most don't do well at all and end up closing in short order.

[Berkshire]

There is a street corner in Toronto (Queen and Broadview I think) that has a Starbucks, a Tim Horton;s (a Canadian icon coffee/donut shop), a Timothy's (a knock off Starbucks/Tim Horton's hybrid) by yet another Starbucks. I was taking a market research course a number of years ago when the question, "how does Burger King do their market research when they choose a new location?", was asked. After a few minutes of guessing and creative ideas by the course participants, the instructor answered, with deadpan sincerity, "they look for the local McDonald's and open up across the street." Simple and cheap.

It happens everywhere.

Yes, it does happen everywhere, but, again, the issue that we are identifying with these Thai mom and pop shops in particular, is that they often don't do well at all. Also, they are not multinational rich, heavyweight companies with brand images and brand recognition to worry about, so your example is really not all that relevant here. If these Thai businesses did well, then their copycat practice would be valid in that regard. But, the simple truth is that most don't do well at all and end up closing in short order.

How do you know this, exactly? Just from the mere fact that most new businesses generally fail? I think DowntownAl brought up a very valid example. Do you really think that these little Mom and Pop operations--many of whom are investing the precious little that they have--are just blindly copycating others without any real thought? If you can, say, open a coffee shop in a high-traffic area where there's already several coffee shops, or open one out in the boonies where there isn't one already (i.e., low traffic), where would you go? Simple example which excludes many variables, but I don't think the boonies is the right answer.

[BigJohnnyBKK]

I think the most hilarious thing is that we've not got two threads right next to each other that are discussing exactly the same thing just like the businesses we're commenting on!

[xthAi76s]

There is a street corner in Toronto (Queen and Broadview I think) that has a Starbucks, a Tim Horton;s (a Canadian icon coffee/donut shop), a Timothy's (a knock off Starbucks/Tim Horton's hybrid) by yet another Starbucks. I was taking a market research course a number of years ago when the question, "how does Burger King do their market research when they choose a new location?", was asked. After a few minutes of guessing and creative ideas by the course participants, the instructor answered, with deadpan sincerity, "they look for the local McDonald's and open up across the street." Simple and cheap.

It happens everywhere.

Yes, it does happen everywhere, but, again, the issue that we are identifying with these Thai mom and pop shops in particular, is that they often don't do well at all. Also, they are not multinational rich, heavyweight companies with brand images and brand recognition to worry about, so your example is really not all that relevant here. If these Thai businesses did well, then their copycat practice would be valid in that regard. But, the simple truth is that most don't do well at all and end up closing in short order.

How do you know this, exactly? Just from the mere fact that most new businesses generally fail? I think DowntownAl brought up a very valid example. Do you really think that these little Mom and Pop operations--many of whom are investing the precious little that they have--are just blindly copycating others without any real thought? If you can, say, open a coffee shop in a high-traffic area where there's already several coffee shops, or open one out in the boonies where there isn't one already (i.e., low traffic), where would you go? Simple example which excludes many variables, but I don't think the boonies is the right answer.

Fair question. My statement, of course, was not meant to be taken as an absolute. Like others have done here, it is more of an educated guess from personal observation, discussions with Thai family members -- many of whom run businesses -- and discussions with local vendor acquaintances.

To answer your question, yes, I do think many of

these little Mom and Pop operations--many of whom are investing the precious little that they have--are just blindly copycating others without any real thought

.

Anecdotally, again, I've seen this lack of critical thought given to similar small businesses in my wife's family, and they are generally upper class and well-educated by Thai standards. I'm talking Mahidol, Chula, Thammasat and Kasertsat (sp). So, to anticipate (or assume, if you don't mind) that this may happen throughout the even less educated populace is not such a stretch.

As far as the simple example you've listed goes, I think it's just too simple in this situation. I don't think that we are generally talking about locations lacking sufficient population density as this is Thailand/Asia. Of course, it wouldn't make sense to open a shop in a place where people are rarely found. But, again, that's not the issue. There are plenty of locations. My criticism, as I've stated prior, is that Thais seem rather disinterested, or, if given the benefit of the doubt so-to-speak, they seem unable (perhaps insufficiently educated) to 1) assess market demand in a given area and 2) differentiate their offerings to potentially be more competitive.

Edited May 24, 2012 by xthAi76s

[Berkshire]

Anecdotally, again, I've seen this lack of critical thought given to similar small businesses in my wife's family, and they are generally upper class and well-educated by Thai standards. I'm talking Mahidol, Chula, Thammasat and Kasertsat (sp). So, to anticipate (or assume, if you don't mind) that this may happen throughout the even less educated populace is not such a stretch.

As far as the simple example you've listed goes, I think it's just too simple in this situation. I don't think that we are generally talking about locations lacking sufficient population density as this is Thailand/Asia. Of course, it wouldn't make sense to open a shop in a place where people are rarely found. But, again, that's not the issue. There are plenty of locations. My criticism, as I've stated prior, is that Thais seem rather disinterested, or, if given the benefit of the doubt so-to-speak, they seem unable (perhaps insufficiently educated) to 1) assess market demand in a given area and 2) differentiate their offerings to potentially be more competitive.

I think you're being a little bit unfair when assessing the Thai business climate and I'll explain why. Firstly, it's easier to start a business in Thailand than the US. Lower cost (generally) and less regulations to deal with. Secondly, people are less compelled to start a business in the US because of the social welfare net, as well as higher pay and various benefits available simply by working for someone else (e.g., medical insurance, pension, etc.). In Thailand, Thais know that they're on their own and working for someone else simply will not achieve financial independence, let alone amass any sort of wealth. So most believe that the only way out is to start their own business.

In summary--and in my judgement--many entrepreneurs in the west start their own businesses because they're really good at what they're doing, they enjoy it, and they have the financial means. Many folks in Thailand start a business because they simply feel that they have no other choice. The results of both systems are clear.

[xthAi76s]

Anecdotally, again, I've seen this lack of critical thought given to similar small businesses in my wife's family, and they are generally upper class and well-educated by Thai standards. I'm talking Mahidol, Chula, Thammasat and Kasertsat (sp). So, to anticipate (or assume, if you don't mind) that this may happen throughout the even less educated populace is not such a stretch.

As far as the simple example you've listed goes, I think it's just too simple in this situation. I don't think that we are generally talking about locations lacking sufficient population density as this is Thailand/Asia. Of course, it wouldn't make sense to open a shop in a place where people are rarely found. But, again, that's not the issue. There are plenty of locations. My criticism, as I've stated prior, is that Thais seem rather disinterested, or, if given the benefit of the doubt so-to-speak, they seem unable (perhaps insufficiently educated) to 1) assess market demand in a given area and 2) differentiate their offerings to potentially be more competitive.

I think you're being a little bit unfair when assessing the Thai business climate and I'll explain why. Firstly, it's easier to start a business in Thailand than the US. Lower cost (generally) and less regulations to deal with. Secondly, people are less compelled to start a business in the US because of the social welfare net, as well as higher pay and various benefits available simply by working for someone else (e.g., medical insurance, pension, etc.). In Thailand, Thais know that they're on their own and working for someone else simply will not achieve financial independence, let alone amass any sort of wealth. So most believe that the only way out is to start their own business.

In summary--and in my judgement--many entrepreneurs in the west start their own businesses because they're really good at what they're doing, they enjoy it, and they have the financial means. Many folks in Thailand start a business because they simply feel that they have no other choice. The results of both systems are clear.

Hmm... That is something to think about. 'Two sides of the same coin'.

[egdirb]

Monkey see, Money do.

[brit1984]

Anecdotally, again, I've seen this lack of critical thought given to similar small businesses in my wife's family, and they are generally upper class and well-educated by Thai standards. I'm talking Mahidol, Chula, Thammasat and Kasertsat (sp). So, to anticipate (or assume, if you don't mind) that this may happen throughout the even less educated populace is not such a stretch.

As far as the simple example you've listed goes, I think it's just too simple in this situation. I don't think that we are generally talking about locations lacking sufficient population density as this is Thailand/Asia. Of course, it wouldn't make sense to open a shop in a place where people are rarely found. But, again, that's not the issue. There are plenty of locations. My criticism, as I've stated prior, is that Thais seem rather disinterested, or, if given the benefit of the doubt so-to-speak, they seem unable (perhaps insufficiently educated) to 1) assess market demand in a given area and 2) differentiate their offerings to potentially be more competitive.

I think you're being a little bit unfair when assessing the Thai business climate and I'll explain why. Firstly, it's easier to start a business in Thailand than the US. Lower cost (generally) and less regulations to deal with. Secondly, people are less compelled to start a business in the US because of the social welfare net, as well as higher pay and various benefits available simply by working for someone else (e.g., medical insurance, pension, etc.). In Thailand, Thais know that they're on their own and working for someone else simply will not achieve financial independence, let alone amass any sort of wealth. So most believe that the only way out is to start their own business.

In summary--and in my judgement--many entrepreneurs in the west start their own businesses because they're really good at what they're doing, they enjoy it, and they have the financial means. Many folks in Thailand start a business because they simply feel that they have no other choice. The results of both systems are clear.

Correct

[Jingthing]

Oh, please many people in the west start businesses because they have little or no choice as well. Namely -- IMMIGRANTS who don't speak the language well enough to be easily hired or members of minority groups who are discriminated against.