The Malta Business Observer, 19th November 2020

NEWS Issue 116

| November 19, 2020

Distributed with Times of Malta

Retailers retain hope in the run-up to Christmas

Real estate companies are still feeling the impact of the COVID19 pandemic, some stakeholders say, despite recent figures published by the Malta Developers’ Association claiming buoyancy in the sector. see pages 5, 7 >

Rebecca Anastasi Businesses in the retail sector are looking ahead to the Christmas period with a sense of optimism, according to industry stakeholders, who said that the festive season might provide a desperately needed boost to a dismal year, though sales are still expected to remain markedly lower than usual for the festive season.

“2020 has been a hard year for all of the economy, no less the retail sector which has had to face some of the hardest challenges to date,” the President of the Malta Chamber of Commerce, Enterprise and Industry, Perit David Xuereb, said.

“From the feedback we have from members operating in this field, it is understood that, while they are optimistic about the upcoming Christmas period, which will hopefully bring about a much needed impetus into business, this is expected to be a very particular festive season as many operators expect sales to be significantly slower than the previous Decembers they are used to.”

Retention of appreciable sales “will have a lot to do with how safe

NEWS

Digitisation, e-commerce, epayments, business rebooting and, even, a gelato cup are some of the avenues creative entrepreneurs have sought to follow to deal with the devastation wrought by COVID-19. see pages 9, 10 >

their customers and visitors feel in their outlets and by how confidence will be brought about by the mature actions of all of us,” he continued, adding that “significant investment has been made by most retail outlets to enable a credible and solid recovery of losses endured since March.”

However, while “the public is still expected to make purchases

ahead of Christmas, as the country closes off one of the toughest years in experience, general expected reduction of consumer spending power will make its mark.”

To help boost sales, The Malta Chamber had proposed that businesses ought to extend their Black Friday offers over a longer period of time, the President reminded. This was to entice cus-

tomers to visit their outlets, while avoiding overcrowding.

“The Chamber’s recommendations have consistently relied on the basic principles that will keep customers healthy and that will remain its advice until such time as the term ‘COVID’ starts forming part of our history continued on page 3

BUSINESS OPINION

The COVID-19 pandemic has shown the need for the diversification of the Gozitan economy, says Daniel Borg, the CEO of the Gozo Business Chamber, who underscores the urgency for a long-term vision for the island. see page 11 >

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Retailers offering early discounts, online stores to prevent overcrowding continued from page 1 books. This same principle may very well apply to the Christmas season, as retailers are expected to address these challenges creatively, possibly turning them into an opportunity.”

Looking ahead, he said that the second batch of Government vouchers, expected to be rolled out in January, “is certainly expected to help businesses recuperate some lost ground at the start of the new year.”

Conveying their experience on the ground, Jackie Urpani and Theresa Bartolo Parnis, owners of India Ltd, the company behind Monsoon and Accessorize – which boasts shops across Malta and Gozo – said they were well stocked, and looking forward to a positive season. “Our stores are looking fabulous, so we are hoping to have a good Christmas, although, obviously, we cannot expect it to match up to previous years since customers are mindful of the everpresent COVID-19 problem.”

Indeed, they continued, “it would also be a tall order to expect a good Christmas to make up for the loss of sales that was sustained in the extreme circumstances of the previous months.” Furthermore, in recent months, and in response to the challenges the pandemic presented, the company has also moved online, offering a remote alternative for those based in Malta, and not willing to risk the vagaries of postage.

“This year, for the first time, we will have a fully functioning, brand new online platform showcasing the brands, so if people feel wary about venturing out, they can grab Monsoon and Accessorize from the comfort of their own home. We hope that we have been proactive in combating these extreme circumstances by being innovative and thinking of new ways to facilitate shopping to our customers,” they said, explaining that they are relaunching the site this week and have organised a fashion show to showcase the collection.

“We are confident that we have done all we can to ensure that our Christmas is as successful as it can be under the circumstance. This includes tweaking stock packages to ensure we have the right products that the customer is looking for, the set-up of online, and, of course, maintaining the standards of our stores that a Monsoon and Accessorize customer has become accustomed to,” they explained.

Looking into 2021, however, the numbers of active cases must come down, sooner rather than later, for retailers to be able to pick up their losses. “Things will be very bleak after Christmas if circumstances don’t improve. We will think, plan and stay positive, discuss our challenges and struggles with the powers that be, in the hope that together we can all find the best way to weather this storm.

With the right commitment, there is always a way,” they said.

Expressing an even more hopeful view, Stephania Buhagiar, Commercial Manager, who represents Juniors Toy Shop, said the firm believes that, “taking the latest trends in consideration and looking at our performance in November, sales running up to and over the Christmas period will make up for this year. Sales will be very close to last years’,” she insisted, adding that one of the key factors for the current upswing is that people are staying in, “so they need to keep the children busy.”

Moreover, she continued, “over the last six months, there have been problems with online shopping from abroad, so many people are not taking the risk. They are also not waiting. In fact, our Christmas sales started earlier than usual, with people even asking for wrapping paper as early as October. This is because there is a feeling of uncertainty. People are somewhat expecting a lockdown, and not everyone is confident enough to purchase online, from abroad, so they are pre-thinking their gifts.”

Closer to home, this is the first time Junior’s has launched on online store. “We cannot compare it to last year, since it’s our first year, but, in summer, the impact of online was limited, though as soon as children got back to school we started getting busier online. This is probably because customers are being more careful and would like to limit their interactions.”

“Significant investment has been made by most retail outlets to enable a credible and solid recovery of losses endured since March.” – Perit David Xuereb, e Malta Chamber President Indeed, online sales still make for a small fraction of the total, accounting for seven per cent of Juniors’ total sales. “More people are coming to the shops,” Ms Buhagiar asserted, adding that the company was incentivising earlier Christmas shopping through discounts and deals.

“Usually sales start increasing from the week of Black Friday to Christmas, itself. But the fact that we cannot have many people in store pushed us to encourage people to come earlier. At any rate, we start building our stock levels for Christmas from July, so we’ve tried to spread the sales coming in. After all, we are also afraid of a lockdown,” she added.

However, Christine Pace, the Managing Director of retail group, Dorkins Ltd, held a different view.

“With so many health warnings in the run-up to the Christmas period, expectations within the retail sector are low. I don’t believe that there will be a peak to make up for this year,” she said.

Dorkins Ltd operates various franchises on the Maltese islands, including Dorothy Perkins, Top-

shop, Topman, Wallis, Evans, Superdry, as well as Clarks and Marella, with stores located in the shopping hubs of Valletta and Sliema. However, despite the upswing in sales it usually experiences at this time of year, the company has had to rethink its strategy.

“Dorkins Ltd is working on pushing online sales and is launching various promotions to encourage consumers to spend and gain. Hopefully, consumers will use this to their advantage and buy items to also use next year,” Ms Pace said.

If sales remain low over Christmas, she continued, “COVID-19 will have a significant impact on the retail business,” in the longterm. In light of this, she advocated a proactive approach. “We need to think long-term, work differently and identify new opportunities for 2021. We need to make sure we have an easy seamless online business but, at the same time, focus on giving the best in store shopping experience to get customers wanting to come back in store,” once this is over.

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NEWS

Real estate players at odds regarding performance of the market Ray Bugeja Real estate companies are still feeling the impact of the COVID-19 pandemic, some stakeholders say, despite recent figures published by the Malta Developers’ Association claiming buoyancy in the sector.

According to figures released by the MDA recently, October was the best month so far this year and one of the best since 2017 in terms of the number and value of promises of sale agreements registered with the authorities. The MDA has said that 1,551 such agreements were registered, amounting to a total sales value of €371 million, up 21 per cent, in terms of numbers, and 36 per cent, or €100 million, in value, over October 2019. These figures could not be confirmed by stakeholders to whom The Malta Business Observer spoke.

However, also speaking to The Malta Business Observer, the MDA President, Sandro Chetcuti, insisted the preliminary data published is reliable and 100 per cent correct. He acknowledged that some real estate agents might doubt such figures because competition in the market meant that, while some were experiencing positive developments, others were encoutering problems.

Mr Chetcuti said that, according to his own observations, demand for low-end property – priced up to €250,000 – has grown while the number of buy-

ers looking for upmarket, highend units has dropped slightly.

In light of these figures, Mr Chetcuti claimed that the healthy performance by the real estate market should also be attributed, at least in part, to the proposals made by the MDA and which were adopted by the Government.

Another contributing factor, the MDA President continued, was the fact that putting one’s money in the bank was becoming a costly exercise, not to mention the many questions one is asked when doing so. This, he said, was leading many to invest their money in property.

Moreover, many are understanding the value of property as an excellent investment, he said.

By way of example, it appears that there is a surge in interest in garages and parking spaces, not only for one’s vehicle, but also for investment purposes. There is also a growing demand by private individuals for agricultural land to serve as a recreational area for their families and friends, he noted.

The MDA, Mr Chetcuti pledged, will continue to closely monitor developments over the next two to three months so it can make timely proposals to the Government to sustain the market if it deems it necessary.

However, in reaction, Benjamin Tabone Grech, Chief Executive Officer of Engel & Völkers, noted that, since he did not know

how the MDA data was generated, he could not comment about it, though he added that he would be very interested in having access to this data, which, he believes, was available to the Finance Ministry. Such information would be useful to produce specific market reports for validation purposes, he remarked.

Mr Grech pointed out that, judging by the experience of his own company, the past months were the worst in terms of promise of sale agreements. “We have not concluded a single promise of sale agreement for quite some time now,” he shared.

He acknowledged that the measures announced in Budget 2021 did lead to more enquiries being made and also affected demand positively. However, the perception remained that prices are still more or less the same, Mr Tabone Grech asserted. Agreeing that, in some instances, a drop of four or five per cent in asking prices was being made across the board, this was nowhere near the decrease expected by prospective buyers, Mr Grech said.

It was only the incentives launched by the Government that made a little difference and nothing else, he insisted.

Saying he would continue to be an optimist, Mr Tabone Grech felt this was an opportunity for one to rethink what one wants the market to look like. There is no doubt, he went on, that a very large stock of

property remains unsold and, since financial direct investment is not what it used to be, until just a short time ago, corrections can be made without risking a downturn.

The CEO noted that the practice of people buying property on plan is becoming less popular and prospective buyers are laying stress on quality.

There is also “an oversupply”, he noted, pointing out that between 60,000 and 70,000 new units were built in the span of 13 years and questioning whether all of them are inhabited. The

Planning Authority needs to revisit its policy on new dwellings, according to Mr Tabone Grech.

He insisted on the need for both the Government and the planning regulator to have a robust development strategy. “Of course, there is purpose in allowing development.

However, there must be a clear direction and objective,” he argued.

However, Michael Bonello, CEO of Alliance Real Estate People, has a different experience to report. Apart from the few continued on page 7

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NEWS

Budget 2021 property measures likely to lead to stability in real estate supply continued from page 5 months of partial lockdown – when everything was at a standstill – it seems the pandemic did not really dampen the market’s appetite for sound investments in real estate, he said.

“It is clear the measures announced by the Government in June have had the desired effects of stimulating the market and substantial interest generated during summer resulted in consistently increasing sales in the run-up to the beginning of the fourth quarter,” he noted.

Mr Bonello added that, since Alliance launched its new brand in July, its database grew with many new properties and the sales volume concluded was sufficient for Alliance to enable it to reach last year’s targets.

The company recruited about 30 new property advisors and was seeing “a great deal of interest” from other independent estate agencies to join Alliance Group. However, he pointed out, franchising growth is not within the company’s immediate plans.

In the meantime, Douglas Salt, Director, Frank Salt Real Estate Ltd, noted that, at the beginning of the year, the stable real estate market was experiencing a period of “slight correction” in both sales and letting after a period of overheating.

When Malta was affected by the COVID-19 outbreak, the market practically stood still for almost four months but, as the figures of people afflicted by the pandemic started to drop, the sales market got going once again, he noted.

Pricing patterns remained unchanged despite talk of a disproportionate drop in pricing, he said, adding that, as uncertainty continued to prevail, more people opted to invest in property, resulting in a record number of sales between July and October.

He acknowledged that the letting market experienced “some trying times”, with monthly rents being adjusted to a more reasonable level and becoming more affordable.

Mr Salt pointed out that this would have happened nonetheless as more units are put on the market.

Mr Salt expects to see a return “to a semblance of normality in the tail end of next year”.

Referring to the data released by the MDA, Keith Galdies, CTO at Djar, a real estate online listings platform, noted that, on the basis of the figures published, the average value of the properties for which a promise of sale agreement was signed stood at €240,000.

Djar’s own data, based on property listings, shows that both supply and pricing remained relatively stable, he pointed out, adding this could be partially attributed to the typical property transaction cycle and the time lag between listing,

negotiation and offer, promise of sale and final transaction.

“Having said that, we cannot exclude that a number of these promises of sale include other types of properties, such as graves or properties transferred

from parents to their children, taking advantage of the higher duty-free threshold introduced during the last Budget. Unfortunately, there is no public data available on this to back it up,” the CTO remarked.

However, going forward, he predicts that the Budget 2021 property measures are likely to result in more stability in supply, while the effect on pricing still needs to be gauged further down the line.

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NEWS

Companies re-invent themselves to survive pandemic Ray Bugeja Digitisation, e-commerce, e-payments, business rebooting and even a gelato cup were some of the avenues creative entrepreneurs have sought to follow to deal with the devastation wrought by COVID-19, according to comments received by The Malta Business Observer from various SMEs. In late 2018 and early 2019, the ice cream franchise, Sottozero, embarked on a project based on a business plan to grow from a family-run company to a European franchise. This required the consolidation and streamlining of operations, in line with the business strategy of increasing points of sale around Malta and Gozo. The second phase – entailing an operational overhaul – was

intended to launch a digitisation platform for the franchise, aimed at facilitating online sales and enhancing customer experience.

These plans were inevitably disrupted when the pandemic emerged and the expansion project had to be postponed to the beginning of 2021 due to the company’s re-engineered business plan that prioritised digitisation projects, Sottozero Group General Manager Edward Mizzi shared.

“We entrusted staff with ambitious projects and motivated them on crucial functions that determined our survival and also outlined a future focus for the franchise. For every cloud, there is a silver lining,” he said.

Sottozero invested in its human capital, which, the General Manager remarked, would be crucial when the software application solution will be

launched next year. Based on the 15 years of experience in the catering industry, Sottozero Group is thereby moving towards eliminating queuing at retail outlets and providing customers added value in terms of an efficient and a swift service.

The company also embraces new e-payment solutions, which will help it cut costs and provide a ‘safer’ service for frontline employees and customers alike, Mr Mizzi explained.

A drop in sales led to the closure of the company’s Sliema outlet but the other in Buġibba remains open. The initial signs of decline, due to the pandemic, were experienced in February, with an estimated loss shooting up to 70 per cent when compared to 2019.

As a result, the General Manager said the company re-engi-

“e COVID-19 reality exposed a number of fissures in the foundations on which the economy is built: an over-reliance on construction and tourism is simply not sustainable.” – Matthew Bezzina, eCabs CEO neered activity at the Buġibba outlet as it capitalised on its assets and resources to minimise losses. Sottozero even launched a take-away gelato cup product that was so popular, sales of the product amounted to 12 per cent of the total between June and September, he added.

Digitisation made up for the losses the company was forecasting for the Buġibba operations and, in fact, turnover grew by about 10 per cent due to the switch to digital methods, he noted. continued on page 10

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NEWS

Urgent need for consultation process leading to renewed economic plan – Chamber of SMEs continued from page 9 Mr Mizzi remained hopeful tourism will start catching up towards the end of the first quarter of 2021, especially if an effective vaccine is available, acknowledging, however, that, in terms of footfall and tourist numbers, it would be “nowhere close to 2019”.

He reaffirmed that Government aid measures were essential for survival. To him the Government’s commitment to support businesses even into the forthcoming months – in his view, the most severe of the pandemic – was an encouraging sign.

In the transport sector, Matthew Bezzina, Chief Executive Officer of eCabs Ltd, was asked whether it is necessary for enterprises to re-engineer their business model and in his view, ‘necessary’ is an understatement and ‘fundamental’ would be a better term.

“Geopolitical factors, market forces, natural disasters, pandemics – which we will probably get to experience again in our lifetime – as well as new technologies and the inevitable rise of AI will necessitate businesses to have enough foresight and organisational structures in place to pivot and adapt to change in this ever-changing landscape,” he remarked.

Mr Bezzina noted that he entered the ride-hailing industry at a time when the disruptive era was still in its embryonic stage.

In fact, it was his company that triggered the disruption, he pointed out, adding that such disruption delivered a lesson: to continuously challenge the status quo and drive change, depending on the needs of the market, irrespective of the internal and external forces that will inevitably resist such change.

Re-engineering is a never-ending process – it has no beginning and no end, he stressed. Adapting to the ever-changing needs of the commercial and digital environment ensures the operational and financial sustainability of any business, Mr Bezzina asserted. Resistance to change is inevitable, he said. However, stakeholders slowing down or opposing change need to be let go.

As to Government involvement in the evolving process, he feels the state must adopt a proactive approach, preparing and legislating for new technologies and concepts that will hit Malta’s shores in the very near future.

This country, he continued, must learn from the eye-opening

experience and avoid past mistakes, thus steering clear of adopting an ultra-reactive approach when dealing with new technologies. In his view, the Government should also intensify its efforts to encourage companies to go for digitisation and reward those that invest in tech R&D. “The COVID-19 reality exposed a number of fissures in the foundations on which the economy is built: an over-reliance on construction and tourism is simply not sustainable and it is fundamental that the country immediately kick-starts a weaning process from these two specific industries,” the eCabs CEO insisted.

What lies ahead? His reply is ominous: it will have to get worse before it gets better.

Operating in the events sector, Gianni Zammit, Director and Chief Executive Officer, Jugs Malta, echoed many of these thoughts. “Unfortunately, when something as unexpected and game-changing like a pandemic hits your business, re-engineering and rethinking your business model is essential and not just necessary,” he said.

He explained that, when COVID-19 hit, “it wiped us out 100 per cent”. Nothing the company offered could be done: no team-building activities, no events and no conferences.

“We quickly put on our ‘out-ofthe-box thinking hats’, which we are well known for wearing, and looked at potential and immediate changes and diversification to our business,” Mr Zammit added.

“Has this saved and salvaged the entire company? Far from it, but I believe it helped us weather the storm and retain as many of our team as possible and ‘survive’ for as long as we have till today,” he acknowledged, adding that the management rebooted the company with a few major updates.

As a result, the Director asserted, Jugs Malta is now in a stronger position to build “a tomorrow, a tomorrow that has the potential to be better and bigger than yesterday, and a tomorrow that has the company more aware of the ‘business dangers’ that can sneak upon it,” he said.

The months ahead, he said, will be challenging “in a rebirth manner”. Thus, “we are re-imagining the way we bring people together, rebuilding what needed to be changed and using our past to inform the future of our business, our people and our clients,” Mr Zammit asserted.

Regular re-engineering is critical, according to Jo Caruana, who

founded the Finesse Group, which helps global enterprises to curate their customers’ experiences – from effective communication to excellence in customer care.

“The business world is changing at an unprecedented pace and last decade’s rules no longer apply. This is where an outside eye can be truly valuable in helping to assess what is working and what is not. Again, just because your communications, systems, processes and teams were effective just after you set up, or when you last had a growth spurt, this does not mean they are still reflecting you at your best now,” she remarked.

She pointed out that, over the past few years, the Finesse Group helped countless organisations, ranging from micro start-ups to global chains, to take a long, hard look at themselves, evaluate what is working and what is not, and then re-engineer change.

Speaking more generally, Abigail Mamo, Chief Executive Officer of the Chamber of SMEs, explained that, after COVID-19 hit Malta, businesses went through a process of digesting the new situation they were facing, and understanding what was happening to assess how best to proceed.

“e Government must come up with aggressive schemes to attract businesses to the sectors deemed necessary for the future.” – Abigail Mamo, Chamber of SMEs CEO

The SMEs Chamber urged members to use time wisely. In their own way, many of them responded to its appeals and recommendations in varying degrees, she continued.

There were those that did not waste time and changed the market in which they operated – drastically, in some cases. Others tweaked operations, considerably improving the manner in which they worked. Most had to adapt to the new situation of working remotely, she added.

Ms Mamo pointed out that such changes would usually take months and even years to implement but, in view of the prevailing circumstances, they had to be executed within weeks or just a few months.

She now sees the urgent need for Government to embark on a consultation process leading to the drafting of an economic plan that will also list those new sectors the country should be focusing on.

At present, she continued, businesses are using conjecture to establish a way forward, but it would help immensely if they were to have clear direction from the Government in order to work together for a sustainable economy.

“The Government must come up with aggressive schemes to attract businesses to the sectors deemed necessary for the future and to, also, launch more incentives to assist sectors facing difficulties but which can become part of the country’s new economic plan,” Ms Mamo asserted.

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EDITORIAL

Holding out for hope This week’s news of two vaccination trials, those for Pfizer/BioNTech and Moderna, exhibiting high efficacy levels in protecting people from transmission of COVID-19, was, understandably, trumpeted across the globe. You could almost hear the collective sigh of relief as governments, businesses and citizens started to stake their hopes on a swift, and full, confirmation of the results and a roll-out announcement.

Yet, while, it is likely that Malta will receive the approved vaccines shortly after distribution starts – with the European Union having said it is very close to signing a contract with Pfizer for 300 million doses while it is also in talks to purchase millions of doses from Moderna – a number of challenges still lie ahead before we are all in the clear. Production and logistical hurdles are but two of the issues, and Governments will also have to address any health concerns populations may have with taking the shots.

Indeed, it will be many months before life will get back to normal. So, what can businesses, who are still reeling from this year’s performance, do? In this month’s edition of The Malta Business Observer we ask several local firms for their insight on how they’ve adapted to the situation, and how they’ve had to transform their business as a result of the exigencies of the crisis. The feedback has been positive, with companies thinking outside the box, though how many of their new practices and innovations will be kept in the longterm remains to be seen.

In the short-term, with Christmas just around the corner, we ask retailers whether, on looking at current trends, this festive season can make up for a dismal year. Opinions vary, though it has been heartening to hear the pragmatic and sober assessments these businesses have for the next few weeks. For, while many admit that this year will be like no other, they are attempting to make the best of the

situation and, for some, sales might almost reach those of last year.

However, despite the constructive business plans being put into motion, one thing is clear. Virus numbers need to go down if we’re going to be able to have a safe and prosperous Christmas with some good cheer - and, if we are to avoid locking down again. For, this is what businesses are very concerned with: the uncertainty of not knowing whether they can remain open for the festivities. If the numbers stay high, will the authorities decide to shut shops to prevent overwhelming the health system? So far, indications are that they will not. But, as one retailer put it, ‘we just don’t know’.

And, as people become more afraid with the rise in COVID cases, they will start looking at where the heart is, at protecting their families, and staying home. Without clear leadership and direction, it’s every man and woman for themselves. And that’s anathema to the Christmas spirit.

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BUSINESS OPINION

Planning ahead for Gozo’s long-term future

Daniel Borg The COVID-19 pandemic has shown the need for the diversification of the Gozitan economy. During the past months, the Gozo Business Chamber published two important documents: Post COVID-19 – Strategic and Policy Document, and Rethinking our Economy – GBC Budgetary Proposals. The Strategic and Policy Document outlined the Chamber’s vision for the diversification of the Gozitan economy – a vision based on the necessity of planning for the long term in order to have a sustainable economy which can benefit Gozitan society as a whole. In its budgetary document, the Chamber focused again on this aspect which, however, did not exclude important short-term measures that will ensure the survival of many businesses on the island.

The effects of COVID-19 on Gozitan businesses This year, the Gozo Business Chamber conducted two surveys.

The first was conducted in March 2020, when the Government had not yet introduced important measures, such as the COVID-19 Wage Supplement. When asked, on a scale from 1 to 5, how the outbreak of the COVID-19 had affected their business – with 5 being very negative, and 1 having no effect – 72.5 per cent of the respondents highlighted that it had affected them very negatively.

In the second survey, conducted between 9th and 14th September 2020, businesses were again asked from a scale of 1 to 5, how the COVID-19 pandemic affected their business, with 5 being very negative, and 1 having no effect. The majority (46.7 per cent) outlined that they were affected in a very negative way. The fact that the Government had introduced a number of measures, which sought to alleviate the impact of the COVID-19 on businesses, may have led to this decrease.

To this end, the Chamber noted positively both the continuation of the COVID-19 Wage Supplement till March of next year, as well as the reissuing of the vouchers which have positively impacted the local Gozitan economy, especially during the summer months.

During the last survey conducted by the Chamber, 75.6 per cent had agreed that the COVID-19 Wage Supplement should be extended beyond the month of October, while 64.4 per cent had agreed with the statement that the Government should issue another round of vouchers to stimulate the economy.

The long-term vision Budget 2021 held some important items in terms of the Government’s long-term vision in the area of transport and connectivity.

In this direction, Government renewed its commitment on the permanent link between Gozo and Malta. It also highlighted that the fourth ferry will be established on a permanent basis, and that the fast ferry service between the two islands will be implemented.

The Chamber was, and still is, in favour of multi-modal forms of accessibility which would ensure Gozo’s long-term social and economic development.

The Government’s overall emphasis on digitisation and the Green Economy were also welcome. These were also the pillars on which the Chamber built its budgetary proposals. In the area of digitisation much has been done, mainly the establishment of the digital innovation hub in Xewkija and the fibre optic link between the two islands, which is to become operational in the

coming months. The next step should be a holistic incentive package specifically formulated for the island of Gozo. This would incentivise the creation of an eco-system of companies in the digital sector on the island.

In the area of the Green Economy, the Chamber believes that Gozo can really set the pace. However, in this case, specific incentives for the island need to be drawn up such as a higher refund for electric vehicles to Gozo residents, and reduced ferry tickets on these type of vehicles. In this area, however, protection of what we already have is of utmost importance. The incessant development currently taking place in Gozo cannot continue as is. A specific development policy for Gozo – which would protect its villages and green belts – is necessary.

In terms of infrastructure, attention should be given to the

new breakwater in Marsalforn, a multi- level storey car park in Victoria, and a new hospital for Gozo which should complement the investment already made in the Barts Medical School.

Concluding remarks The Chamber believes that the right ingredients are there. Gozo now needs a long-term vision.

The establishment of the Gozo Regional Development Authority is a step in the right direction and will play an important part in bringing all the entities together in the present multi-level governance scenario. Apart from the establishment of a long-term strategic plan, this Authority will also ensure that Gozo is included in all the national strategic plans issued.

Daniel Borg is the CEO of the Gozo Business Chamber

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EDUCATION

e European Skills Agenda raises the bar in digital skills acquisition Carmel Cachia

There is no doubt that skills have always been the most important component for a society’s economy and culture to thrive. Businesses need people with the proper skills to compete, and it is crucial for Europe, as a continent, to retain its competitiveness through its human resources potential, when compared to other geopolitical regions. But to achieve this aim, Europeans must receive the right education and training to be able to progress in their jobs and be valuable contributors to their societies.

The COVID-19 pandemic has revealed the truth about the state of skills and their acquisition.

The pandemic has accentuated the fact that Europe lags behind when it comes to digital skills.

COVID-19 crucially needed digital skills for teleworking and distance learning. Indeed, virtual methods and needs have now become the new reality for millions of people across the EU. The European Skills Agenda is a major European instrument, set up by the EU, following feedback from member states. The

plan is reviewed every five years, with the current version applicable until 2025.

As planned in the Agenda, the European Commission launched the Pact for Skills on 10th November this year. It is a new engagement model for skills which will help meet COVID-19 challenges and deliver on the ambitions of the recovery pathway, and this is linked with various other initiatives, including the EU SME Industrial, the EU Digital Strategy and the Digital Education Action Plan.

Skills are key to the future.

There is a growing need to learn in order to progress in progress in terms of employment, career, and place in society. Only through collaboration, can we bring about the scale of change required to foster an economic recovery that is socially inclusive.

Under the Pact, industry, public and private employers, social partners, education and training providers as well as employment agencies will work together on a shared vision and on definitive actions. The Pact aims to mobilise and incentivise all relevant stakeholders to take concrete actions for the upskilling and reskilling of people of working age using relevant pooling efforts through sustainable partnerships.

The European Skills Agenda calls for collective action by mobilising business, social partners and stakeholders, to commit to working together.

The Agenda defines a clear strategy to ensure that people continue building their skills throughout their careers, using lifelong learning systems. It also identifies the significant financial funds required to invest in skills, while also setting ambitious objectives for the upsklling and reskilling of staff over the next five years. To achieve these goals, the European Commission has identified 12 important actions: 1. Mobilising countries and their industries to agree to the Pact, launched on 10th November, in order to mobilise partnerships and invest in creating opportunities for people through proper training and education.

Under the Pact, the Commission will offer a single entry point of reference, at the European level, where everyone can access information on EU funding and programmes for skills development for those of working age; 2. Improve on providing the right skills intelligence from all sectors in a timely manner, making use of data analysis

“Only through collaboration, can we bring about the scale of change required to foster an economic recovery that is socially inclusive.” technology, which should be made widely available; 3. EU support to member states for the development of modern national skills strategies, including the strengthening of collaborations with national employment agencies; 4. Energising and modernising vocational education and training to make them more attractive, flexible, and appropriate for the digital age, as well as for the continent’s green transition; 5. Rolling out the European Universities initiative and upskilling scientists to build transnational collaborations between higher education institutions throughout Europe, including the developing of a core set of skills for researchers; 6. Boosting digital skills through a digital education action plan and ICT to increase

training courses and develop a set of core green skills; 7. Increasing the number of STEM graduates, fostering entrepreneurial and transversal skills; 8. Implementing further lifelong learning for youth and adults on important societal issues such as media literacy, civic competences, financial, environmental and health literacy; 9. Exploring an initiative on individual lifelong learning accounts, so that people are stimulated to keep abreast with the skills needed during all phases of life; 10. Implementing European standards for accredited short training courses to help in the recognition of the results of such training; 11. Revamping the Europass platform to offer online tools and guidance on CV-writing, focused information for jobs and learn-

e Malta Business OBSERVER |

November 19, 2020

EDUCATION

“The European Digital Strategy identifies four areas of important implementation and involves an inclusive and sustainable society with a strong competing digital economy, positioning Europe as a global player.” ing opportunities, which should be available in all 29 languages; 12. Boosting the EU budget to increase digital skills as a right to every citizen at any stage of life, thus improving transparency, and exploring modern methods of financing such initiatives.

It is also pertinent to mention two important European initiatives that link up with the European Skills Agenda. a) The Digital Education Plan 2021-2027 (DEAP). This resets education and training for the digital age, and two strategic priorities have come out of this plan: • Fostering the development of a high-performing digital education ecosystem. This will be done through the improvement of infrastructure, connectivity and digital equipment, as well as effective digital planning; the fostering of organisational capacities; increasing the digital competence of educators and their supporting staff; developing high-quality learning content with user-friendly tools; and securing platforms to safeguard privacy and ethics; • The enhancement of digital skills and competencies needed for digital transformation. This needs the right digital skills, competencies and literacy from a very early age. It includes skills to identify disinformation, computing education, and a good understanding of emerging technologies. It also requires the acquisition of advanced digital skills to create more digital specialists by providing a genderneutral platform so that girls and women are equally represented in these careers. b) The European Digital Strategy identifies four areas of important implementation and involves an inclusive and sustainable society with a strong competing digital economy, positioning Europe as a global player. Specifically: • Technology must work for people and must make a difference in their daily lives. European values must be fostered and balanced with a skilled society to boost the digital economy; • The digital economy must be fair and competitive, working within a single digital market to reap all the benefits. Companies of all sizes will have an opportunity to develop, and compete on equal

terms by using the digital technologies products and services to boost their global competitiveness; • An open, democratic and sustainable digital society where citizens are empowered in how they act and interact, and have control over the data they provide both online and offline. This is a fundamental right for citizens, and contributes to a sustainable, green economy; • Europe must be competitive and advanced enough to be a global digital player and compete with the other continents.

Europe already lags behind the US and Asia in some technologies, however it is ahead in others. It remains committed to become the most open region for trade and investment.

The European Skills Agenda is definitely one of the most important instruments for digital skills acquisition. It plays a central and essential role in Education for European workers and employers, and encourages the economic recovery from the COVID-19 pandemic. It will foster economic growth and the well-being of society through the enhancement of skills.

Carmel Cachia is the Chief Administrator of eSkills Malta Foundation

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e Malta Business OBSERVER |

November 19, 2020

CASE STUDY

Maypole goes green, reduces plastic output by 439,000 bags over three months Rebecca Anastasi Maypole Group reduced its plastic output by 439,000 bags over July, August and September, as part of its strategy to adopt more green initiatives in the packaging of its products, the firm’s Director, Sebastian Debono, said.

“Our production data shows that, in the months of July, August and September, Maypole, with the support of our loyal customers, has managed to reduce its plastic output by no less than 439,000 bags. Multiply that by four, to extrapolate to a year, and we will be using over 1.7 million bags less,” he said, explaining that this is well-over the

Group’s target of a 1.5 million reduction in plastic bag usage over 12 months by switching to custom-made paper bags, emblazoned with the Group’s corporate logo.

“Three months ago, Maypole launched yet another of its green initiatives, and promised to use at least 1.5 million paper bags a year, solely from our flagship product, the traditional Maltese loaf – il-ħobża talMalti,” he explained.

Indeed, the firm has continuously kept tabs on the situation, in order to ensure that this goal would be met. “We were closely following the numbers. Our target of a reduction of 1.5 million plastic bags in the first year was,

by all measures, ambitious, but was no way a wild shot in the dark. We had not just bandied a figure in order to feature in a headline or two, but rather, had engaged in a strategic measure based on calculations and projections,” he asserted.

The Group’s Director outlined the aims of this project which, he said, were driven by a number of different motivations.

“First and foremost was our awareness of the natural environment, and the need to protect it. We want to be leaders in efforts being made by all players to safeguard the environment in our country,” he said.

Citing plastic bags as a key contributor to pollution, Mr

“We want to be leaders in efforts being made by all players to safeguard the environment in our country.”

Debono stressed the concern felt by the company in its use of the packaging material. “As we all know, once plastic bags are produced and used as packaging, there is no telling where

they might end up. Too often we have been regaled with images of plastic islands in the middle of the ocean, on the large scale, or a single plastic bag being responsible for damaging sea life,

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November 19, 2020

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CASE STUDY

“Paper bags respect your ħobża talMalti.”

such as in the case of turtles, who often mistake these bags for jellyfish, and end up the worse for it.”

In contrast, “the paper bags in which we are now handing and selling our loaves, besides offering myriad possibilities for reuse, are made from the most easily recyclable materials.

Paper bags respect the environment,” he underscored.

The decision to switch to paper bags also rested on the need to ensure quality is retained, even after the loaves leave Maypole’s stores. “We are also passionate about the quality of our product and great care is taken in preparing our ħobża tal-Malti for our customers’ enjoyment. From the selection of the ingredients, through the whole baking process – carried out six times a day – to the fresh delivery to our shops all over the islands, we strive to ensure that the ħobża that our clients take home adheres to the highest standards of health and goodness,” he asserted.

Indeed, he continued, “our research and ongoing quality control showed us that the traditional and characteristic crustiness of Maltese bread was being lost due to the poor aeration offered by plastic bags. The crust of the loaf retains this characteristic when comfortably packed in our loose-fitting paper bags,” he said, adding that “paper bags respect your ħobża tal-Malti.”

Elaborating on the motivation behind this initiative, Mr Debono said that “the absolute majority” of their customers, “with whom we retain constant contact through social media and all other channels at our disposal, have confirmed to us that they care about the excessive amounts of plastic, in many different forms, being released into the environment,” he said.

Moreover, the Group is “also aware of the yearning for a fresh ħobża tal-Malti, with a crunchy crust, for our customers to rel-

ish, either as an accompaniment to their main meal, to be dunked in sauces, used for scarpetta, or a sandwich with any one of the ingredients the Maltese love so much,” he said explaining that this change is evidence of the Group’s commitment to better customer service.

“We have our customers’ best interests at heart. We respect our customers.”

And, since the adoption of this new packaging, the firm has been “carefully monitoring the progress and development of its implementation.”

Customer feedback has been encouragingly positive, he explained, “with appreciative comments flowing in both about the environmental considerations that we have shown, and also about the better-retained crustiness of the loaf.”

Indeed, while “there was also a limited number of doubtful reactions due to the mistaken perception of the increased crunchiness of the crust as being lack of freshness, these did not last, as customer appreciation of the increased retention of the time-honoured contrast between the hard exterior and the soft interior increased from day to day,” he emphasised.

MAYPOLE GROUP DIRECTOR, SEBASTIAN DEBONO

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e Malta Business OBSERVER |

November 19, 2020

BUSINESS UPDATES

Cloud construction software can do the heavy lifting and transform your business Whereas in the past, a physical computer or server was necessary in order to run an application, cloud-based computing gives users access to software applications that run on the internet.

Businesses are increasingly moving to the cloud to increase efficiency, information flow, collaboration, and absolute flexibility. As exclusive resellers of Acumatica Cloud ERP in Malta, our team at Computime Software shares three key benefits of cloud-based accounting software built specifically for the construction industry.

1. Real-time access to your business applications Perhaps the major benefit cloud computing can offer is that it allows you to set up what is essentially a virtual office. This provides all back office and onsite construction workers the flexibility in their work practices by enabling immediate access to current data. So, as long as you have access to an internet connection, you can work efficiently.

Indeed, those working remotely or in the field can enter important data on their device and have it automatically synced within the ERP system, thus providing insights across an organisation without delay. When a team has full, up-to-date visibility and can access, share, and edit documents anytime, anywhere, it increases collaboration and improves decision making.

2. Mobility through a native app Modern cloud construction software such as the Acumatica Construction Edition provides secure remote access through a native mobile app. This empowers onsite workers in the construction industry with a single source of real-time data such as revenue and costs. It also gives them the ability to check intuitive dashboards from their mobile device, manage contracts, view change orders, and exchange information with customers, suppliers, and contractors.

3. Reduced IT costs Managing and maintaining IT systems can be costly, so many construction companies are moving towards a Software-asa-Service (SaaS) model instead of purchasing software outright, thus moving to a cloud-based construction accounting software which means paying much less upfront. Furthermore, rather than using a traditional per user pricing model, Acumatica has a unique, all-inclusive user licensing model which encourages usage of the system across the entire organisation.

Transform your construct ion business with remote access , real-time data, and streamlined processes From accounting, project and field management to CRM, the Acumatica Construction Edition offers a full set of construction management functionality, which coupled with the Acumatica mobile app, creates a seamless flow of data between the field and the back office. This allows you to run the entire construction

cycle more efficiently and provides your employees access to real-time insights for improved decision making.

For more information on how Computime Software can help your business improve margins and project control at all stages of home, multi-family, commercial, mixed-use, land development, and government projects, visit www.computimesoftware.com/acumatica-erp/construction-edition/ or email info@computimesoftware.com

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e Malta Business OBSERVER |

November 19, 2020

BUSINESS UPDATES

INBOUNDMUSE: launching AI digital marketing software via Europe As our society becomes more data-rich and interconnected, the way we do business is changing. Companies need to process massive amounts of data to better understand and access their markets. The Maltese tech company, InboundMus, has developed an AI digital marketing software. To maximise their reach and impact, the firm has turned to the Enterprise Europe Network, the largest global network supporting small and medium-sized enterprises (SMEs), cofinanced by the European Union.

Tyron Lloyd Baron founded InboundMuse in 2015. With a team of techies, the Maltese tech company set out to develop an AI optimisation software to help companies generate more reliable marketing insights and returns. After a lot of trial and error, InboundMuse’s software eventually evolved into a laser-focused pay-per-click optimisation tool – particularly of interest for dataheavy companies (e.g. gaming companies, AI companies, e-commerce retailers).

Assured of the commercial feasibility of their AI optimisation, InboundMuse still

HSBC Malta introduces innovative digital solutions for Malta businesses HSBC Malta has rolled out various digital solutions to the business community in Malta during the COVID-19 pandemic.

These solutions, designed to help businesses continue operating in these challenging times, together with the bank’s future plans for digitisation, were outlined during a recent webinar titled ‘Re-engineering for the future’, organised by The Malta Chamber as part of the SME Week.

The webinar was addressed by Emanuele Vignoli, Head of Global Liquidity and Cash Management, UK NonRing-fenced Bank and Europe International Markets at HSBC, who explained how the bank has introduced mobile authentication and the use of soft tokens, giving business owners easy and secure access to their accounts. The introduction of live online chat specifically for business customers has further enhanced the level of digital service being offered. Throughout this period, HSBC has been proactive in reaching out to its business customers to provide advice on how best to use the digital channels available.

The SME Week focused on efforts to raise digital awareness among business owners and to support enterprises who are planning to scale up their activities. In this context, HSBC Malta is committed to introducing Treasury application programming interfaces (APIs) to enable

ships with the other Maltese companies involved in the mission to Ireland.

needed to take steps to engage new partnerships and business endeavours. In need of direction, InboundMuse approached the Enterprise Europe Network local office in Valletta. The Network, with its 3,000 experts from more than 600 member organisations based in 60 countries worldwide, is a valuable source of support for SMEs in accessing EU funding and partnerships.

NEW PARTNERSHIPS ON THE HORIZON

MISSION POSSIBLE In December 2019, along with representatives of five other Maltese companies, Mr Baron arrived in Cork, Ireland, as part of an international company mission organised through the EEN. Mr Baron attended a series of meetings with some of Ireland’s most reputable cluster organisations, businesses and innovators. As Mr Baron recalls, “In Ireland, I knew the local scene, but we wouldn’t have had the opportunity to set meetings without the Network’s support.” During the Ireland mission, Mr Baron set up an official meet-

TYRON LLOYD BARON AND MARK MALLIA ing – and eventually signed a Partnership Agreement – with the CEO of the global privacy management firm, Beacon AI. As an offshoot, Mr Baron has also benefitted from cultivating professional relation-

The Network’s support for InboundMuse has extended beyond the successful mission to Ireland: tapping into Horizon 2020 SME funding, but also accessing coaching and mentoring. As a result, the company has been growing rapidly, with a team of client-facing officers, data scientists and administrators operating all over Europe and servicing a wide cadre of international clients. With the Network’s continued support, InboundMuse is highly motivated to continue EU-wide engagements, as a potential partner in future EUfunded projects or as a host with the Erasmus for Young Entrepreneurs programme.

Find out how your local Enterprise Europe Network can support your business. enterprise-europemalta.com

GO’s new Infinity Mobile plans can help you and your business discover unlimited flexibility

EMANUELE VIGNOLI, HEAD OF GLOBAL LIQUIDITY AND CASH MANAGEMENT, UK NON-RING-FENCED BANK AND EUROPE INTERNATIONAL MARKETS AT HSBC customers to initiate, track, request and receive payments in real time.

Furthermore, HSBC Malta has committed to work on innovations towards enhanced mitigation of cyber-crime risk and has embarked on education initiatives on cyber fraud by raising awareness via anti-fraud messages and on-screen warning alerts. The bank has also held refresher sessions on fraud reporting for internal teams to equip them with the skills to raise customers’ vigilance relating to fraud and to directly support Malta’s welfare, jobs, innovation, and competitiveness.

Mr Vignoli, said: “HSBC has delivered the capability for businesses in Malta to integrate their internal systems and infrastructure to HSBC via APIs. Business owners, Treasurers and Financial Controllers need real-time access to information, globally, to support liquidity management and cash flow forecasting.

As a consequence, customers are digitising payments and collections processes to leverage new opportunities and refine their business models, which is increasingly important as they navigate the current pandemic.”

Flexible working is increasingly reliant on mobile data. GO’s new, unlimited business mobile plans can help you meet your growing data demands head-on.

Remote working has helped many businesses weather the disruption caused by coronavirus. However, there’s no doubt that new remote working tools and policies can add complexity to our working lives. When you add data caps to the mix, it’s just another layer of complexity you and your employees need to manage.

That’s exactly why GO provide a business plan offering unlimited data, as well as unlimited calls and SMS messages. As part of the Infinity Voice add-on, you can choose who will benefit most from unlimited calls,

and deliver it as part of their individual plan.

You won’t have to worry about excess charges or the impact of lengthy phone calls – giving you flexible connectivity, value for money and one less thing for you and your people to worry about.

Find out more about GO’s Infinity Mobile plans at www.gobusiness.com.mt

Enemed’s rigorous tendering process Enemed purchases all its fuel requirements through a tendering process digitally hosted on the British company’s Delta e-Sourcing platform. Tenders are automatically sent to oil traders on a dedicated list.

Any queries and clarifications are done through the platform and visible to all. The platform keeps records of all events happening throughout the duration of the tender. No bids are visible before the closing time and date of the tender. Enemed publishes the tender two weeks before the closing date. On the closing date, the Fuel Procurement Committee, composed of the company’s Executive Chairman, Company Director, Chief Officer Operations, Chief Officer Finance, Enemed Financial Risk Officer, as well as a legal advisor and an independent observer, opens the tender and adjudicates the bids. The entities submitting the compliant bids are contacted to make any possible clarifications and requested to improve their bids. The tender is then awarded, once the committee is still convened, to the cheapest bidder.