Retailers could face graver sale drop due to 2nd wave of Covid-19

The 2nd wave of the coronavirus is getting worse and has affected MRCA members, especially those working in shopping malls


WHILE people have been avoiding crowded places and other busy establishments since the outbreak of Covid-19, the second wave is expected to bring greater woes, particularly to the retail sector.

Malaysia Retail Chain Association (MRCA) VP Datuk Liew Bin said the second wave of the coronavirus is getting worse and has affected MRCA members, especially those working in shopping malls.

“I think sales have dropped to at least 50% to 70% or more. If mall owners do not give a stimulus package, I think most of them cannot survive,” he told The Malaysian Reserve (TMR) recently.

However, for retailers who operate at residential areas such as KK Super Mart and the likes, their sales are still stable as consumers are not going to hypermarkets to buy things, said Liew.

“I think sales of those convenient stores have increased about 10% to 15% because people are buying sundry goods from nearby stores, not shopping malls where there are too many people,” he added.

Retailers like Sunway Malls have been gearing up to address the threat posed by Covid-19 by introducing a group-wide marketing campaign worth RM5 million to stimulate consumer spending and drive sales to benefit both retailers and consumers.

Its associate director in branding and communication Darren Chear said the company is still monitoring the second wave impact as it happened just a week ago.

“We need a longer period to monitor the impact. For the first wave, Sunway Malls saw a slight dip in the initial week but recovered the weeks after that. We are already running a month-long sales-driven programme across our malls to stimulate sales,” he told TMR.

Local shopping malls have already undertaken precautionary measures to reduce chances for the virus to transmit by ensuring hygiene and cleanliness among shoppers and staff.

Among the notable steps taken are installing hand sanitisers at central spots in malls and frequent cleaning which involves the disinfection process by sanitising facilities and common areas that are mostly touched.

According to the Department of Statistics Malaysia, businesses are predicting slower performance in the first quarter of 2020 (1Q20). The confidence indicator further declines to -2.1% compared to -0.5% in the previous quarter.

The wholesale and retail trade sector expects its business performance to be less favourable in 1Q20 with its confidence indicator further declining to -5.3% from -4.9% in 4Q19.

However, businesses remain optimistic towards their performance for January till June 2020 with a smaller total net balance of +1.1% compared to +6.4% in the previous quarter, said chief statistician Datuk Seri Dr Mohd Uzir Mahidin.

“All sectors expect positive business performance except for the wholesale and retail trade sector. The industry and service sectors expect positive performance although smaller with +1.9% and +2.4% respectively,” he said in a statement.

The wholesale and retail trade sector continues to foresee its business performance to decline with a net balance of -2.9%, while the construction sector’s business performance remains unchanged