PETALING JAYA: As household spending dips, business-to-consumer enterprises expect a year before seeing adequate profits again.
Malaysia Retail Chain Association (MRCA) president Datuk Seri Garry Chua (pix) said although shoppers had been trickling back to malls, it would be the end of the year before retailers saw a rise in profits.
“We don’t expect business to pick up until November or December. The usual peak period and festivals will give a bigger incentive to consumers to spend,” he told theSun yesterday.
“Malls will have to give good discounts as consumers, even the T20 (income group), will be looking for value buys. However, it might take up to the middle of next year for profits to return to pre-pandemic levels.”
Chua said retailers have to introduce measures to keep their businesses afloat in the meantime.
“At least 20 to 30% of retail staff have had to be laid off as there was no income and companies had no way to pay their workers. Others have had to take pay cuts.
“Online sales have also helped, especially those selling food and beverages such as bubble tea. But delivery services such as Grabfood and Foodpanda also take a 30% commission, which eats into their earnings,” he said.
Chua also urged malls and retail businesses to adhere strictly to government standard operating procedures (SOP) in the nation’s fight against the Covid-19 pandemic.
Malaysian Federation of Hawkers and Petty Traders Association president Datuk Seri Rosli Sulaiman said his members have been struggling.
“Many were living hand-to-mouth before the Covid-19 pandemic and do not have any savings. Even if they reopen their shops, no customer will come,” he said.
“Consumers are only spending on essential items. Buyers are leaning to meats and necessary vegetables but are staying away from fruits and greens that are pricier or spoil easily. It will take a year for these small businesses to get back on their feet.”
Malaysian Indian Restaurant Owners Association president T. Muthusamy said the loosening of restrictions to allow dine-in customers has brought relief to restaurants.
“More than half of them have started reopening their restaurants. However, the important thing is to follow the Health Ministry guidelines to keep the premises safe,” he said.
“We are seeing profits of between 10% and 40% of what we made before MCO. Some have even exceeded 50%.”
Muthusamy added that online sales and delivery services had been helpful but only covered about a third of pre-pandemic sales.
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