Malaysia Retail Report

Retail growth to exceed 9% in Q1

According to the Retail Group Malaysia’s (RGM) latest report, members of the two retailers’ associations project an average growth rate of 9.2% for the Malaysia retail industry during the first quarter of 2023.

This comes on the heels of an encouraging fourth quarter in 2022 when the Malaysia retail industry recorded a strong growth rate of 13.7% in retail sales, as compared to the same period in 2021.

On November 3, Bank Negara Malaysia raised the Overnight Policy Rate (OPR) by 25 basis points to 2.75%. This was the fourth revision in a year. Malaysian households had to deal with reduced spending power due to higher monthly loan repayment.

After two consecutive years of dismay due to Covid-19, Malaysia retail industry recorded a positive growth rate of 33.3% for the entire year of 2022 This final annual growth figure was based on seasonally adjusted volume sales on each quarter of last year.

This historical high annual growth rate is unprecedented and in terms of total sales value, Malaysia’s retail industry in 2022 recovered to 2019 level.


Type Period % Growth
Retail sales Oct-Dec 2021 26.5
Jan-Mar 2022 18.3
Apr-Jun 2022 62.5
Jul-Sep 2022 96.0
Oct-Dec 2022 13.7
Jan-Dec 2022 33.3

Source: MRA/ MRCA/ Retail Group Malaysia

9.2% growth



Retail Sub-Sector % Growth rate
Overall (weighted) 9.2
Department store cum supermarket 6.4
Department store 15.8
Supermarket and hypermarket 3.9
Mini-mart, convenience store & coop. 15.8
Fashion and fashion accessories 12.3
Children and baby products* 4.5
Pharmacy 13.3
Personal care 20.8
F&F, home improvement and E&E# 0.6
Other specialty retail stores 0.4
 *- include apparel, accessories, equipment, school uniform and toys
 #- furniture & furnishing, home improvement and electrical & electronics
 Source: MRA/ MRCA/ Retail Group Malaysia

For the first quarter of 2023, Malaysia’s  retail industry is expected to enjoy a strong growth of 9.2% due to Chinese New Year festival and new school holiday in February and March. Malaysia retail industry is anticipated to grow by 2.8% during the second quarter with contribution mainly from Hari Raya festival.

The third quarter growth rate is estimated at 2.0% only due to a high base in the same period a year ago. For the last quarter of 2023, Malaysia retail industry is hopeful of a 3.0% growth rate after a rosy performance a year ago.

The department store cum supermarket operators is hopeful of a sustainable growth rate of 6.4% for the first quarter of this year. After achieving steep growth rates last year, the department store operators will experience normalisation of its business with a growth rate of 15.8% for the first 3-month period of this year.

Operators of mini-markets, convenience stores and cooperatives are predicting its business to strengthen with a growth rate of 15.8% during the first 3 months of this year.

Retailers in the fashion and fashion accessories sub-sector are eyeing a healthy growth rate of 12.3% as compared to the same period a year ago.

Retail Group Malaysia has revised its annual growth rate in retail sale for 2023 to 4.0%, an upward adjustment of 0.5% point from its projection made in November last year.


Quarter Growth rate (%)
First (e) 9.2
Second (e) 2.8
Third (e) 2.0
Fourth (e) 3.0
Whole year (e) 4.0
      (e)- estimate
      Source: Retail Group Malaysia

Domestic tourism has recovered since the Hari Raya festival in 2022 and helped build up shopping traffic in retail stores and shopping centres. Although foreign tourists are coming back to Malaysia, it’s still far off from 2019 levels, it will only fully recover in 2024.

Luxury tax will be introduced from second half of this year. Nevertheless, the tax rate, the list of goods to be taxed, the area of coverage and date of implementation have not been finalised. It is too early to establish the impact on the Malaysian retail industry.

This report is excerpted from interviews with members of Malaysia Retailers Association (MRA) and Malaysia Retail Chain Association (MRCA) on their retail sales performances for the entire year of 2022 and the first quarter of 2023. For details, write to [email protected]

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