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KUALA LUMPUR, May 18 (Bernama) -- The purchasing power of Malaysians is expected to remain positive, which could lead to a strong recovery in the retail industry in 2022 with a projected 6.3 per cent growth for the year versus a 2.3 per cent contraction in 2021, said Retail Group Malaysia (RGM).
"The retail industry may see improved performance in the Q2 in light of the recent Aidilfitri period but concerns over the prospects linger due to external factors that would affect the consumers’ purchasing power,” said RGM managing director Tan Hai Hsin.
“Retail purchasing is positive at this moment, but my concern now is how long can it last?," he asked during a retail sector briefing and launch of Xilnex Voucher Network.
Tan said the industry is expected to grow at 4.2 per cent in the second quarter of 2022 (Q2 2022) as consumer purchasing power has rebounded after a gloomy two years, followed with an estimated 3.4 per cent and 3.6 per cent growth rate in third and fourth quarter, respectively.
Tan also listed a few factors that could encourage consumers to open their wallets, such as relaxation of standard operation procedures and MySejahtera check-in.
However, he said consumers purchasing power would be limited by higher living cost and accelerating inflation.
"Factors like higher interest rate, as well as the Ukraine war, although far away, affect us as well.
Global economic slowdown and ongoing lockdowns in China have also affected transmission and logistics cost resulting in imported goods to increase, he said.
Tan also noted that the COVID-19 pandemic has accelerated digital transformation among retailers in Malaysia with payments via e-wallets or orders through QR code scans widely accepted.
The pandemic has led to a new retail revolution in Malaysia with consumers moving online.
“Suprisingly, there are still many retail businesses in Malaysia that refuse to digitalise their operations. Now that consumers have returned to the physical outlets, many retailers may revert to their pre-pandemic operations,” he said.
Hence, he urged Malaysian consumers, financial institutions, technology companies and the government to play more active roles to ensure that the digital transformation continues.
Meanwhile, retail management software company Web Bytes Sdn Bhd today launched Xilnex Voucher Network to help boost sales and expand consumer base for its merchants.
The company is sponsoring RM300,000 worth e-vouchers from its merchants to be distributed to university students through student enrolmenrt platform Uni Enrol which is recognised by more than 80 private universities and colleges nationwide.
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