Vision needed to overcome tough times

VICHA POOLVARALUCK

By WORANUJ MANEERUNGSEE

Vicha Poolvaraluck, chairman of Major Cineplex Group Plc, the country's largest cinema chain, knows bad news is on the way. But he is optimistic that 2009 prospects will be better than 2008.

Like many businessmen, Mr Vicha hates uncertainty. Last year, he was aware of the beginning of the financial crisis on Wall Street but unsure of how bad it would be.

After the dust settled, more than a dozen of the world's leading financial institutions collapsed. But their governments rushed to bail them out, severely limiting the impact. World leaders agreed to work together to respond to a once-in-a-lifetime problem.

Fortunately, there are some good news that would benefit Thailand as well such as interest-rate cuts and falling oil prices that eroded consumer confidence in spending worldwide last year.

It is important for leaders to have vision when things are irregular, said Mr Vicha, who guided his cinema chain through the 1997 crisis.

In 2006, he was named by Money and Banking magazine as one of the richest men in Thailand measured by his shareholdings on the Stock Exchange of Thailand.

"It is always important to have vision from brainstorming and gathering information when a crisis awaits. We always keep in mind our strengths, weaknesses and risks,'' Mr Vicha said.

"For instance, we frequently talk with studios in Hollywood about the situation in America.''.

Keeping in touch with Hollywood studios and McDonald's relieved him. Prospects for cinemas and fast-food business there are bright, showing no effects of the lower purchasing power of Americans. He hopes that positive trend will carry to Thailand and his businesses including McThai Co, the local McDonald's operator.

Affordable goods and entertainment usually survive during hard times. When current economic troubles started hitting the American economy in 2007, Hollywood scored record-high revenue, selling US$9.6 billion in tickets in the US alone.

He believes cinema can entertain audiences in both good and bad times. In bad times, people find entertainment to be a diversion. "Watching movies makes people happier than anything,'' he said. "But they must be cheap and convenient as well.''

Mr Vicha keeps the Thai economic situation in mind when describing how to cope during this period.

He sets a "guest count'' target as a goal for staff to accomplish this year. Increasing moviegoers by 20% to 36 million would increase not only ticket sales revenues, but also refreshment incomes, he said. He expects 20% growth in sales revenues in 2009.

Aggressive marketing and promotion will be a key tool as well as price strategy. Ticket prices will not increase, and in some instances branches will cut prices.

New cinemas are another method. The capital investment for 2009 is set at one billion baht, up from 600 million baht last year. It will add six screens and 10 bowling lanes in Nakhon Pathom, west of Bangkok. It also just laid the foundation of its new Esplanade flagship stand-alone cinema with 16 screens and 22 bowling lanes on Rattanathibet Road in Nonthaburi.

Ong Bak 3 is expected to be one of the biggest box-office films in 2009.

Major Cineplex Group operates 46 movie branches under four brands: Major Cineplex, EGV, Paragon Cineplex and Esplanade. The brands have 344 screens and 84,155 seats.

He said more cinema locations provided convenience for consumers.

"I have told employees that we must be part of consumers' lives and their community. It's a lifestyle. We should create a movie culture that suits Thais.''

Mr Vicha, in his forties, comes to the office at 9 am and leaves the workplace late. He takes his work seriously, is able to show his vision and translate it into action for the employees. This makes his staff respect and believe in him. People skills are important during a crisis, according to Mr Vicha. Leaders must teach by doing.

"I like to show my staff how to do something when I assign it to them. Like when I teach golf to my son, if I don't show him how to play, how can he learn?'' he said.

Mr Vicha also believes in luck. He admits he does not worry because there are many box-office movies this year generating ticket revenues of more than a hundred million baht.

Upcoming movies include the third episode of King Naresuan, Harry Potter and the Half-Blood Prince, Transformers 2 and Ong Bak 3.

But Mr Vicha is still worried about political uncertainty for his cinema business. Local politics have led to a negative sentiment affecting confidence.

"2009 is a year of caution, but not panic,'' said Mr Vicha.