PETALING JAYA: Independent retail research firm Retail Group Malaysia has revised upwards its projected retail sale growth of the Malaysian retail industry for this year to 4.9%, from 4.5% estimated in March 2019.
This is based on the latest results for the first half of 2019, where the Malaysian retail industry achieved a better-than-expected growth rate of 3.8% in retail sales, as compared to the same period in 2018. Members of the Malaysia Retailers Association had projected retail sale growth of 3.1% in March 2019.
“Despite the weak economic environment from both internally and externally, the higher growth expected during the second quarter of 2019 is mainly due to the Hari Raya period. This largest festival in Malaysia is celebrated earlier this year as compared to 2018,“ it said.
The retail sale growth rate for third quarter is maintained at 3.9%. After a major festival celebration, slower growth in retail sale is expected during this period.
Similarly, the estimated growth rate for the last quarter of this year is maintained at 5.8%. School holiday, year-end festival and expected higher economic activities should stimulate consumers’ spending during this period.
Members of the retailers’ association are hopeful that their businesses will improve further during the second quarter of 2019. They projected an average growth rate of 5.5%.
The department store cum supermarket operators are expecting to maintain their average growth at 6.9% for the second quarter of this year.
The department store operators are expecting to recover strongly with a growth rate of 7.2% for the second three-month period of this year.
On the other hand, supermarket and hypermarket operators will not see improvement in their business in the coming months. They expect to remain in the red zone with a -7.4% growth rate for the second quarter of 2019.
Retailers in the fashion and fashion accessories sector expect their businesses to pick up again with a positive growth of 4.2% during the second quarter of 2019.
Retailers in the pharmacy and personal care sub-sector remains optimistic of their businesses with a strong growth rate of 15.2% for the second quarter of 2019.
Similarly, retailers in other specialty stores sub-sector (including retailers selling photographic equipment with photo processing services, optical, sporting goods, fitness equipment, second-hand goods, toys, baking ingredients as well as TV shopping) are hopeful that their businesses will climb higher with a growth rate of 10.8% during the second three-month period of this year.
Except for department store sub-sector, all retail sub-sectors recorded improvement in their retail businesses during the first quarter of 2019. In addition, the department store sub-sector performed below the estimate made by the members in March this year.