Reviving Retail: The Way Forward
Mr Firdaos Rosli, Chief Economist, Malaysian Rating Corp Bhd (MARC)
- Mr Shafie Shamsuddin, Chief Executive Officer and Managing Director, AEON Co.
- Mr Fong Wai Hong, Chief Executive Officer, and Co-Founder, StoreHub
- Mr Kenneth Chuah, President, Lotus’s Stores Sdn Bhd (Lotus’s Malaysia)
In this session, the moderator, Mr Firdaos Rosli of Malaysian Rating Corp Bhd, set the scene by highlighting the devastating impact of Covid-19 lockdowns: the retail sector contracted about 16% in 2020, its worst performance since the Asian financial crisis. In August 2021, retail sales fell by 7.5% yearon-year, compounding the previous month’s decline of around 8%. He also posed the question as to what would be the way forward? For good measure, he mentioned consumer rationality and pointed out that if consumers become more rational in their decisionmaking process, it would affect the economy, though the direction of impact may not be what was expected.
The panellists agreed that the lockdowns had been extremely bad for business but also spoke of how they forced a review of their business model and their approach to technology. As a technology provider, Mr Fong Wai Hong of StoreHub spoke passionately on the importance of utilising technology in the new normal, especially the importance of customer engagement. Traditionally, customers would visit physical stores, but in the new norm, business owners have to reach out to their customers, and technology provides ample opportunities for this engagement to be done virtually.
Mr Kenneth Chuah of Lotus’s Stores Sdn Bhd highlighted changing customer expectations and the difference in experience between physical and online stores, and how Lotus’s has balanced the two channels, while Mr Shafie Shamsuddin of AEON Co. mentioned “symbiotic collaboration” as one of the ways to move forward. New business models are not only needed in retail but in other industries as well, including banking, logistics, and media, requiring an overhaul in how “retail” is defined.
All speakers mentioned that the retail sector is ready to embrace change, but challenges remain with the capacity and speed of adaptation to technology.
“One of the most jarring effects of Covid-19 was that during the pandemic, we were all locked down; we were not even allowed to dine in at restaurants. Business owners were suddenly confronted with the reality that their strategy of physicality was not enough to build a sustainable business”.- Mr Fong Wai Hong
“While we at Lotus’s have had a positive experience, there are strengths unique to any (retail) channel, offline and online. What we need to do is to focus on what we want our customers to experience and deliver that expectation as best as we can.”- Mr Kenneth Chuah
“What does retail mean now and what will it mean in the future? Is conventional (brick and mortar) regarded as retail, and online (selling) not retail? This is a good opportunity for us to be looking at the retail sector as an eco-system than a linear distribution model. I believe that symbiotic collaboration is the way forward.” – Mr Shafie Shamsuddin
“The retail sector, including malls, is one of the worst hit sectors during the pandemic, and we know this for a fact. Due to the lockdowns, the retail sector contracted about 16% in 2020, its worst performance since the Asian financial crisis.”- Mr Firdaos Rosli