Positive growth rate of 3.4% in retail sales, as compared to the same period in 2020. - MARKETING Magazine Asia


Positive growth rate of 3.4% in retail sales, as compared to the same period in 2020.

retail report malaysia

Members of Malaysia Retailers Association (MRA) and Malaysia Retail Chain Association (MRCA) were interviewed on their retail sales performances for the second quarter as well as the rest of 2021.

For the second quarter of 2021, Malaysia retail industry recorded a positive growth rate of 3.4% in retail sales, as compared to the same period in 2020.

During the second quarter of 2020, Malaysia retail industry suffered a year-on-year decline of 30.9% because of business closures.

Shopping traffic recovered when Movement Control Order (MCO) 2.0 ended in March 2021. Although Malaysia was under Conditional Movement Control Order (CMCO) during the first month of the second quarter, shopping malls in all major cities received large crowds on the first weekend after MCO 2.0 was lifted. Some tourist areas had also received good crowd during the weekends.

After surging daily confirmed cases, MCO 3.0 had been re-imposed from 3 May 2021 and ended on 31 May 2021. During this period, majority of retailers suffered from poor sales when Malaysian shoppers avoided enclosed places.

Started from 1 June 2021, Phase 1 of Full Movement Control Order (FMCO) ran for a period of 2 weeks. During this time, non-essential retailers had been ordered to shut down. Malaysians nationwide were asked to stay at home.

RETAIL SUB-SECTORS’ SALES COMPARISON

The performances of retail sub-sectors during the second quarter of 2021 were mixed. Numerous retail sub-sectors were severely affected during this period because their physical stores stayed shut for a long period of time.

Department Store cum Supermarket sub-sector recorded a negative growth rate of 7.5% during the second quarter of 2021, as compared to the same period a year ago.

On the other hand, retail business of Department Store sub-sector rebounded during second 3-month period of this year. After a huge dip in business during the first quarter, it grew by 18.2% during the subsequent quarter.

The Department Store sub-sector had been suffering from double-digit sale declines on quarterly basis since the virus pandemic started. It was the best performing retail sub-sector during the second quarter of this year.

Despite being allowed to open throughout the virus pandemic, the Supermarket and Hypermarket sub-sector was still faced with declining retail sales as compared to pre-covid-19 period. Its business contracted by 12.3% during the second quarter of 2021.

On the contrary, the Mini-Market, Convenience Store & Cooperative enjoyed a moderate growth rate of 2.6% in retail sales during the second quarter of this year.

During the second quarter of 2021, the Fashion and Fashion Accessories sub-sector managed to turn around with a growth rate of 17.6%. Similar to Department Store sub-sector, it was the first time this sub-sector registered a positive growth rate since the advent of the covid-19 pandemic in Malaysia.

The Children and Baby Products sub-sector recorded a decline of 17.4% in retail sale during the second 3 months of this year.

National Recovery Plan (NRP) in 4 phases was implemented from 15 June 2021. Similar to FMCO, non-essential retailers remained close and Malaysian consumers were asked to remain at home.

For the first 6 months of this year, the retail sale growth rate contracted by 4.4%, as compared to the same period a year ago.

For the second quarter of 2021, Malaysia national economy expanded by 16.1% as compared to 3.4% for retail sales (at current prices).

This high growth rate was mainly due to the low base from the significant decline in economic activities a year ago. During the second quarter of 2020, Malaysia GDP growth rate was -17.1%.

Private consumption expanded by 11.6% during the second quarter of 2021. A year ago, it declined by 18.5% due mainly to movement control order.

During the second 3-month period, the Consumer Sentiment Index (by MIER) dropped drastically by 34.6 points. Tight household budget, rising prices and limited job prospects were the main concerns. It had remained below the 100-point threshold level of optimism for 11 consecutive quarters.

Unemployment rate during the second quarter of 2021 remained unchanged at 4.8%.

During the second quarter of this year, Pharmacy sub-sector reported a positive growth rate of 10.0%, as compared to the same period a year ago. This sub-sector was one of the few retail trades that remained open throughout the covid-19 crisis.

The Personal Care sub-sector registered another poor retail result with -36.1% in growth rate during the second 3-month period of this year. Its physical stores stayed shut for most part of the second quarter.

The Furniture & Furnishing, Home Improvement as well as Electrical & Electronics sub-sector reported a decline in growth rate of 1.1% during the second quarter of 2021.

The Other Specialty Stores sub-sector (including photo shop, fitness equipment store, sporting goods’ store, store retailing musical instrument, optical store, shop selling baking ingredient as well as direct selling firm) suffered a large drop in retail sale (-41.4%) during the second quarter of 2021, as compared to the same period last year. This was the worst performing retail sub-sector during the second quarter.

NEXT 3 MONTHS FORECAST

Members of the two retailers’ association project an average growth rate of -15.1 during the third quarter of 2021. Physical stores of majority of retail trades were shut during the first half of third quarter. Except for operators of mini-market, convenience store and cooperative, retailers in all retail sub-sectors foresee downward movement in their sales for the next 3 months.

retail forecast 3 years

The department store cum supermarket operators are expecting their sales to worsen with a negative growth of 25.5% for the third quarter of this year.

After a temporary rebound, the department store operators are expecting their businesses to decline with a negative growth rate of 11.2% for the third 3-month period of this year.

REST OF 2021

In June this year, Retail Group Malaysia (RGM) estimated a 4.0% growth rate in retail sale for 2021. However, this projection needs to revise downwards again taking into consideration the lower growth in second quarter result and the revision of third quarter estimate. RGM revises Malaysia annual retail industry growth rate for 2021 from 4.0% to 0.8%.

retail sales percentage 2020-21


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