Traditional Thai retail businesses are expected to stay afloat, but their market share is likely to drop over the next five years as e-commerce proliferates.
Aat Pisanwanich, director of the Thai Chamber of Commerce's Center for International Trade Studies, yesterday said traditional retail businesses would manage to survive even after regional economic integration late this year.
"Not all Thais are rich and can afford goods only from department stores and modern trade outlets or travel to buy them," he said.
"Traditional retail outlets will remain the main resource for your average consumer."
However, Mr Aat admits proliferating e-commerce will unavoidably affect traditional Thai shops, whose market share is expected to fall to 30% in five years from 40% now.
Modern trade outlets, department stores and convenience stores are expected to compete more fiercely with each other over the next five years, he said.
One area of healthy growth will be online shopping, rising to an expected 2.9% from 0.8% now.
Mr Aat forecasts 4-5% retail growth this year, driven mainly by the economic recovery and government spending.
Thailand's retail market is worth an estimated 4.9 trillion baht this year, with modern trade outlets accounting for 50.2% (2.46 trillion), traditional outlets 40% (1.96 trillion), convenience stores 9% (441 billion) and e-commerce 0.8% (39.2 billion baht).
Market value is forecast to reach 6.84 trillion baht in 2020, with modern trade outlets at 44.7%, convenience stores 22.4%, traditional outlets 30% and e-commerce 2.9%.