Magazines Archives - 2009 January

Can Malaysian retailers weather the global slump?
Story 4 - Focus

The writing is on the wall. There is no averting the difficult year ahead. But not all retailers in
Malaysia expect to be badly hit. Eu Hooi Khaw reveals why.'

Most Malaysian retailers concur that 2009 will be a difficult year for business. The sector, which has been grappling with retail-space glut for the past two years, is also factoring in the impact of the current global slump on the economy — and consumers’ budgets.

The scenario is grim, with retailers expecting to suffer double-digit declines this year.

“It will definitely be difficult for the retail market . With the financial crunch, there will be less disposable income for many and, therefore, spending will be reduced,” says Nelson Kwok Teng Toong, secretary-general of the Malaysian Retailer-Chains Association (MRCA), and founder and managing director of the Nelson’s snack chain that popularised the corn-in-the-cup concept.

“Retailers are already experiencing the impact, and we have heard reports of 20%-50% reduction in monthly sales. This is in comparison with [2007].”

As consumers trade down to stretch limited funds, Kwok foresees retailers offering products in the mid-tier to high-end of the price spectrum to be worse hit than those in the lower end.

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