The six-week-long coronavirus lockdown is expected to slash Malaysian retail sales by 60.7 percent this month as non-essential stores are forced to close.
Retail Group Malaysia, which calculates data on behalf of the Malaysia Retailers Association, estimates that retail sales for the full year will drop by 5.5 percent, should the government’s Movement Control Order be lifted at the end of this month. It has already been extended from March 18 until April 28
RGM’s MD Tan Hai Hsin told The Edge that the majority of the nation’s retailers are recording zero sales this month. “This has never happened before in history”.
While online sales have surged in Malaysia since the coronavirus struck the nation, and consumers are spending more on food and groceries, categories like jewelry, furniture and luxury goods have been decimated.
Last year, Malaysian retail sales grew by 3.7 percent to RM107.5 billion (US$24.8 billion), but RGM is now forecasting RM101.6 billion ($23.45 billion) for the full year, a figure which must take into account a rebound once the lockdown order is lifted.
The MRA estimates 209,000 stores have been forced to close during the lockdown and 90 percent of stalls and markets have been affected, which previously accounted for 63 percent of the nation’s total retail sales. The remaining 126,000 stores classified as essential include supermarkets, hypermarkets, convenience stores and pharmacies.
Meanwhile, RGM has estimated that operating costs, including staff and store overheads, are likely to reach RM20.48 billion (US$4.7 billion) during the lockdown which retailers will have to carry in the absence of sales.
It is, as yet, unclear the volume of online sales during the period and whether these will help mitigate in part the sales decline of any non-essential retailers.