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RETAILING
PITSINEE JITPLEECHEEP & KRISSANA PARNSOONTHORN
Central Retail Corporation Co (CRC), the country's largest retail chain, has approved a budget of 20 billion baht to expand its business in China over two years, double the amount it had been planning earlier.
Tos Chirathivat, the company's CEO and president, said it was the first time that the group's board had formally approved the budget to invest in China's 15 top cities. The company has set up its representative branch in Shanghai and would add more in Hangzhou and Shenyang to select potential sites for Central department stores.
The 20-billion-baht investment budget includes 500 million baht that CRC is spending at Mix C, the largest shopping centre in Hangzhou city, Zhejiang province, next year. Another three projects are still the subject of talks with local and Hong Kong partners as well as government agencies including those in Zhenyang city.
Mr Tos said the company would continue to study business potential in other Asian countries. ''We have registered all Central trademarks for our business units in several potential countries to prevent any piracy,'' he said.
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| Mr Tos shows off a sketch of China World, the new identity for the company's Wang Burapha site. CRC will allocate 12 billion baht to expand its business locally. About 6.6 billion baht would be spent on developing eight department stores under the Central and Robinson brands. |
At home, the company will allocate 12 billion baht to expand its business. About 6.6 billion baht would be spent on developing eight department stores under the Central and Robinson brands in Bangkok, Pattaya, Chon Buri, Khon Kaen, Ubon Ratchathani, Chiang Mai and Chiang Rai. About 2.5 billion baht would be allocated for three HomeWorks outlets in Phuket, and on Srinakarin Road and Ratchapruek in Bangkok.
Another one billion baht would be for the installation of a new merchandising management system to manage inventory and suppliers. Another 500 million baht would go to renovating Tops supermarkets and 80 million baht for the Zense restaurant for Thai, Italian, Japanese and Indian cuisine.
The first phase of the restaurant located on the 17th floor of Zen Department Store will open in mid-September.
The remaining 1.32 billion baht would be for investments including the renovation of Central Department Store in Wang Burapha into China World, a wholesale centre for fashion and accessories.
''After expanding our department stores to cover all big cities, we will expand more to mid-sized cities through the Robinson brand in Chiang Rai, Nakhon Pathom and Phitsanulok,'' he said.
Mr Tos said CRC's sales in the first half of this year rose 7% over the same period last year to 40.6 billion baht. While the performance was better than in the same period last year, the pace of growth was lower than the performance in the past two to three years, when CRC sales expanded at 10-12% on average.
However, the company is confident that sales from all of its business units would reach 87 billion baht this year, up 9% from last year.
Mr Tos said the retail business in the second half would depend mainly on local politics as consumer confidence was sensitive to this issue.
''We're worried about consumer purchasing power, especially urban people, as they have higher expenses but their incomes haven't increased. In fact, the economy is not that bad. We could grow if we didn't have [political] conflict,.''
For the retail market, he said that at least inflation was better than deflation. A ''bearable'' inflation rate should stay below 10%, he added.
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