Today's Pick (09/01/13/06/930) Higher retail sales in Malaysia seen

Higher retail sales in Malaysia seen


FESTIVE SEASON A REASON: Sector expected to grow 5.8pc in 2012

THE retail industry is expected to expand by 5.7 per cent in the last quarter of 2012 while the growth for the year is estimated at 5.8 per cent, according to Retail Group Malaysia (RGM) managing director Tan Hai Hsin.

Tan said the fourth quarter growth forecast is slightly higher than RGM's earlier projection at 5.5 per cent, but lower than Malaysia Retailers Association (MRA) retailers' estimate at 6.2 per cent.

He said the last quarter growth rate is to be supported by the festive holidays, school holidays and year-end sales.

"Malaysian consumers will still remain cautious in their retail spending," Tan said in the Malaysia Retail Industry Report.

The report is based on the interviews with MRA members on their retail sales performances for the rest of 2012.

Tan said the third quarter of last year saw the industry grew at a lower-than-expected rate of 4.8 per cent in sales, compared to an earlier retailers' estimate of 5.3 per cent.

"Although the Hari Raya celebration took place during the third quarter, retail sales did not grow much higher than expected," he said.

He said retail sales in the third quarter slowed down despite civil servants and pensioners receiving cash payment during the period.

"During this quarter, retailers still needed to absorb the rising cost of goods and offer attractive discounts to attract shoppers to buy at the same time. Many retailers were still suffering from negative growth in their profit margins."

For 2013, RGM is maintaining its earlier growth forecast of the retail industry at 6 per cent in 2013.

Tan said many retailers will enjoy better sales during the first quarter of this year when the government hands out cash under the second round of Bantuan Rakyat 1Malaysia to Malaysians from this month.

Also, about five million students from Year One to Form Five will receive RM100 cash from January 15 2013.

The industry is also expecting electrical and electronics retailers to benefit from the RM200 rebate on smartphones for those aged between 21 and 30 years, with a monthly income of not more than RM3,000.

"Furthermore, bookstores will get a big boost in sales when the RM250 1Malaysia Book Voucher is distributed to all private and public university students from February 2013," he said.

RGM expects macro economic environment of Malaysia to remain weak for the first half of 2013, as major turnarounds are not expected on the eurozone debt crisis, the US sluggish economy and weak China exports.

Source : The Star
Date : 8 January 2013
Today's Pick (09/01/13/06/930)