Here’s one article not too long ago. Closures ALWAYS point to ‘tough outlook’ Coming back to just days ago, my old friend is still insisting that the Malaysian economy is in trouble and that if the election result is not up to his expectation, Malaysia will go bankrupt within 5 years. Anyway, everyone’s entitled to their opinions and I just hope that he gets ready for his prediction. For example, identifying some other countries to invest in because he will have to quickly start selling his assets here and buying there. Since his business is based in Malaysia, he may have to move his business to other countries if the result is not up to his expectation within the next one week or so. In fact, if he is selling his property, he must also not try to price his properties too high and sell it 10 percent below the market so that it could be sold as soon as possible. Imagine if everyone else is also trying to sell at the same time , then perhaps even 10 percent down is not enough. Selling your home faster? Some tops (updated) – Usable for RENs too
Anyway, coming back to the current Malaysian retail scene. Remember the closures of Tous Les Jours Bakery, Nature Republic, Tim Ho Wan and Bubba Gump Shrimp Co. Actually there’s more. For example GAP closed all its stores this year. GIANT supermarket also announced some closures of stores which were not doing well. Plus, we should also remember that some banks did some rationalisation exercise? So, yeah, there were quite a number of negative news. Well, here are some good news. Reported in edgeprop.my Retail Group Malaysia managing director Tan Hai Hsin shared that some 95 new foreign brands have made their debut in the Malaysian retail market since 2017 to date. He shared that there were a total of 71 brands setting up shop in Malaysia in 2017. 75 percent of them were in the Klang Valley and 15 percent in Johor. (in other words, just these two accounted for 90 percent of all the new brands) For 2018, 24 foreign brands from 13 countries have set up their first outlets in Malaysia. These new stores were mainly located in the Klang Valley, Johor, Pahang and Seremban.
Tan shared this about the Johor retail scene, “It won’t lose out to the Klang Valley. Quite a number of foreign brands had actually set up business in Johor before they expanded to the Klang Valley.” He also said something I shared earlier in my article. He said, “Online shopping will not replace you [retail stores] but you have to learn how to capture your customers. Every circumstance and market change represent new business opportunities.” As for the percentage for the online stores, it accounts for around 2 percent of total retail sales in 2017. He also said that in 2017, the Malaysian retail industry’s turnover was RM99.8 million. It employed 1.2 million workers in more than 240,000 retail stores, excluding hawker centres. (By the way, it’s quite common that many of these retail stores are always looking for staffs. Perhaps turnover is high because the pay may not be attractive enough. I used to work for a retail outlet selling clothes. I was paid something like RM4 per hour and I think these days, it has gone up a little depending on the brand we join)
Happy shopping because I think 2018 will be a pretty busy year for these new brands. I believe none are coming here with higher priced items because if they do, I wish them the best. This is the time that many new brands can capture market share, especially with better products and lower prices. Price sensitivity will continue. Just look at even the property market to understand why I say so. Landed properties are no longer just competing against landed properties but also bigger sized and more innovative high-rise units. This is especially when the trade off is the neighbourhood which the property is in. More often than not, the landed would have to be pretty far away in order to remain competitively priced. I think this is a great year for buyers, regardless of the item or asset.
written on 29 April 2018
Next suggested article: 197 malls in Kuala Lumpur by 2021. Killing one another?