PETALING JAYA: Shoppers are back in full force going by the numbers from the Malaysia Retailers Association (MRA) and the Malaysia Retail Chain Association (MRCA).
Data from the MRA shows that the retail sector expanded 96% in the third quarter of this year (Q3 2022), a major turnaround from the 27.8% contraction in the same quarter of 2021.
The Covid-19 pandemic that began in 2020 and left most of the country at a standstill had a major negative impact on business operations, and retailers were among the hardest hit.
It was especially tough for them during the enhanced movement control order (EMCO) from July 3 to July 16, 2021.
Retailers were allowed to resume operations under the first phase of the national recovery plan that came into force on Aug 16, last year.
In the just published retail industry report for 2022/23, Retail Group Malaysia managing director Tan Hai Hsin noted that shopping received another boost five days later when the government relaxed the restrictions on the number of passengers in a vehicle as well as travel distance.
Eventually more restrictions were lifted. Restaurants were back in business when restrictions on dining-in were lifted in the third quarter, by which time most businesses were already allowed to operate at full capacity.
“Malaysians were also allowed to travel around the country again, after two years of mostly being confined at home. This helped to spur activity for retailers in tourist spots and small towns,” Tan said.
The retail sector saw a 45.9% improvement in the first nine months of this year compared with the same period in 2021.
The quarterly and nine-month growth rates are unprecedented and are unlikely to repeat themselves unless another forced closure takes place, Tan noted in the report.
Sales turnover by sub-sector also showed significant growth. The department store-cum-supermarket segment saw a 104% increase in Q3 2022 compared with the same period last year. Growth for department stores alone was 376.5%, making this the sub-sector with the highest growth rate.
However, both MRA and MRCA expect the growth rate to normalise at 4.8% for the full year.
Minimarkets, convenience stores and cooperatives saw a 26.1% growth in sales turnover but supermarkets and hypermarkets saw zero growth as Malaysians returned to the lifestyle they are more accustomed to.
Nonetheless, minimarkets, convenience stores and cooperatives can expect to sustain growth at about 19% for the fourth quarter.
Fashion and fashion accessories came in second with a 244.6% quarterly growth compared to a year ago. Child and baby products enjoyed robust growth of 133.8% but this is expected to drop substantially to 3.9% in Q4 2022.
Pharmacies reported a 33.9% growth while the personal care sub-sector grew 110.6%. Growth in the last quarter of the year for the two sub-sectors are expected to reach 13.7% and 19.5% respectively.
Furniture and furnishing as well as electrical and electronics reported a 55.15% growth in Q3 2022 but are likely to see a small growth of 18.5% in the last three months of the year.
However, sales growth for other specialty stores such as photo shops, optical stores as well as arts and craft stores was a moderate 25.3% in the third quarter and is projected to reach 6.6% in the fourth quarter.
Moving forward, MRA and MRCA project an overall average of 13.9% by end of 2022.
Source: https://www.freemalaysiatoday.com/category/business/2022/11/30/retail-sales-record-significant-rise-in-turnover/