Too early to assess coronavirus impacts on retail sector, says PPK

By FARA AISYAH / Pic By MUHD AMIN NAHARUL

MORE time and data needed to assess the impact of Covid-19 on the retail sector as the sector is still coping with the uncertainty of the outbreak, said Malaysia Shopping Malls Association (PPK).

While the impact on retail remains undetermined, PPK believes it is premature to immediately accede to the request for rental rebate.

“We need more time to monitor sales turnover, perhaps over the next few months depending on further development of the current situation.

“Shopping mall members will need to analyse and monitor data and trends and to curate appropriate and targeted action plans, on a case-by-case basis,” the association said in a statement yesterday.

It said besides rigorous marketing activities to drive spending and sales, mall operators should consider to allow tenants to operate shorter business hours, mall wide or only for some of their tenants, as part of the measures to reduce operating cost.

As proven in the past, PPK said it is confident that shopping malls and retailers will remain resilient and overcome the hurdles of the coronavirus has weighed on the sector.

“Records show that shopping mall operators have always assisted tenants in the past during challenging times — for example the SARS outbreak and 1997 financial crisis — and shall meet up soon with the retailers’ representatives to discuss and work out a positive way forward for all of us to overcome and mitigate the current scenario,” said the association in the statement.

PPK had participated in several meetings with the government authorities to request for assistance on measures to preserve cashflow and maintain employment so that there are no lay-offs for both the retailers/tenants and mall operators.

“The association’s requests include subsidies for utilities charges, tax reliefs and temporary suspension of statutory contributions,” it added.

PPK said the shopping industry in the country is different from Singapore, which is heavily dependent on tourists especially from China and Hong Kong which has been badly affected since the anti-government protests in June 2019.

In addition, it said the post-festive season — including the Chinese New Year, Christmas and the 2019 year-end school holidays — is already known as a low season based on the past cyclical patterns.

As such, mall operators and retailers should have factored the dip in retail sales turnover and prepared strategies to rationalise their business operations for the next two to three months.