Shoes fit for growth

  • Smebiz
  • Monday, 25 Mar 2019

Technology aid: To says the company is looking to incorporate more tech elements into its operations.

WHEN Ginny To asked her friend Jack Wong for a place to clean her sneakers, she didn’t know that she would end up cleaning other people’s sneakers too.

To had come to Malaysia from Vietnam to take up a digital marketing job at a tech startup. Starting a brick and mortar business was not on her agenda.

But when Wong couldn’t quite point To to any particular service provider, both of them — founders of local shoe-cleaning startup ShoeMo — thought this could be something worth exploring.

They tested the market by offering shoe cleaning services online. They charged RM10 per pair and offered free delivery once the shoes were cleaned.

To is a little regretful that they charged so low back then. It was a lot of effort, she laughs.

They brought home about six pairs of shoes a day, which they had to clean in their own toilets after their day jobs. Wong’s home even started smelling of shoes!

Within six months, they opened up a physical store to accommodate the growing demand for shoe cleaning services and To quit her job to focus on growing ShoeMo full time.

People see value in this service, says To.

But she admits to ruining a few pairs of shoes in the early days, which they had to compensate for.

Trial and error: The team picked up most of their shoe-cleaning knowledge through trial and error.
Trial and error: The team picked up most of their shoe-cleaning knowledge through trial and error.

“There’s a lot of urban legend on cleaning,” she notes.

They tried all sorts of shoe-cleaning methods they came across — including putting a pair of sneakers in the freezer.

“A shoe is made up of a lot of different materials. You have cloth or leather at the top and the soles are rubber. And each material has different needs. We experimented with a lot of products and methods before we came up with our standard cleaning methods,” she shares.

After cleaning some 15,000 pairs of shoes over the last two years, To would like to think that they can call themselves experts in the field. They’ve found a way to standardise some of the products, tools and procedures used by their staff to clean shoes.

But the team has room to experiment with different cleaning methods.

“We hire people who love shoes. So they are passionate about what they do. And it’s a young team, the average age of our employees is 22-25 years old,” says human resource and operations manager Wong Xian Jin.

In recent months, ShoeMo has also expanded into Singapore, Brunei and Indonesia.

Unlike the local market, To observes that consumers in Singapore have higher spending power with a preference for higher-end shoes. They are willing to pay for a good service, which means better margins for ShoeMo there.

To says its outlet in Singapore is already bursting at the seams and they are looking for a location for another outlet.

Brunei, on the other hand, is a mid-tier market, similar to Malaysia, while Indonesia proves to be a promising market.

“Indonesia is a service-driven market. You can get services for almost anything. But it’s a very competitive market. The biggest competitor in Jakarta has about 30 outlets. But they are mostly local brands.

“We are a regional brand. And we try to stand out in the market by offering a variety of services to cater to more needs,” she says.

To explains that shoes in the Indonesian market are mostly of the lower-end range, making it a volume-driven game.

She also sees potential for ShoeMo to expand to other countries like Thailand and the Philippines.

Big market: The sneaker reselling market is a big industry.
Big market: The sneaker reselling market is a big industry.

But at this point in time, To says ShoeMo is growing a lot faster than the team had planned. There are 11 outlets in total currently, including five licensed outlets.

While this may be good news for a tech startup, it’s a little different for a physical-type business. The set-up cost for each outlet is quite significant.

Perhaps, they may slow down on expansion plans this year and take a harder look at stabilising its existing operations, she says.

That is, unless they secure funding to expand.

it is also looking to expand its offerings.

“We’ve made a lot of mistakes along the way, so we’ve also managed to find new ways to restore shoes. We want to eventually be a one-stop shoe service provider,” she says.

Cleaning services currently contribute 90% to its revenue, with the rest from other services such as repairs. The latter, says To, offers the company a lot of room to grow.

“Resell sneakers is a big industry. Some secondhand sneakers are sold for higher than the original. So repair services for sneakers can grow big as well,” she notes.

ShoeMo is also partnering with other companies to expand, such as shoe retailers. If it can secure deals to be the official maintenance provider for shoe retailers, this would bring in steady business for the company.

To says the local market may eventually see more one-stop shoe solution providers like ShoeMo as other players come into the market. For now, it still has first mover advantage.

The company is also innovating in terms of using technology to enhance its business. ShoeMo uses its own proprietary management system that enables the team to check on the progress of every pair of shoes that comes through its doors.

“The potential for the business is big. Everything that we build, we try to commercialise and supply them to other businesses. We have four pillars to our business, which are technology, licensing, retail and products.

“We have a company that is subscribing to the use of our management system. And we are developing some of our own products like cleaning chemicals. These have potential for us to grow apart from just us expanding into more outlets,” says To.

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