Wing Tai Malaysia Bhd will streamline its retail operations, on the back of the challenging retail landscape in the country.
Notably, the group owns 85 retail outlets in major cities and distributes 12 international fashion brands – Topman, Topshop, Miss Selfridge, Dorothy Perkins, Karen Millen, Warehouse, Wallies, Pumpkin Patch, Ben Sherman, BCBG, Furla and Burton – which are under British fashion retailer Arcadia Group Limited.
Wing Tai’s 45 percent joint venture with Fast Retailing Co Ltd of Japan, Uniqlo (Malaysia) Sdn Bhd has 24 Uniqlo outlets in the country and an online store.
According to Lee Kong Beng, general manager of finance at Wing Tai, Uniqlo will continue to expand in Malaysia since it caters to the mass market, such as the suburban markets in Ipoh, Malacca, Johor and Penang.
The group, however, will consolidate the Arcadia brands since it cannot enter suburban markets.
“We will not expand (the Arcadia brands). Currently there is no intention (to cut stores) but if there’s any store not generating positive cashflow or profit, we may consider (cutting),” said Lee after its EGM.
He noted that the retail space in Malaysia is doing much better compared with that in Singapore, wherein the retail margin has been squeezed.
“For retail, we’d just consolidate because it’s challenging. So no point being a hero, where you open outlets and the sale is not there.”
Nonetheless, Lee said the retail division will still contribute to the group’s earnings, buoyed by higher tourist arrival in Malaysia.
“We expect retail sales to pick up because of the weakening of the ringgit, so it’s cheaper to shop in Malaysia rather than in Singapore. It’s a matter of time people get used to GST. We see that it (retail sales) is more stabilised now.”
Farah Wahida, Editor of PropertyGuru, wrote this story. To contact her about this or other stories email farahwahida@propertyguru.com.my
