Star Fashion Co, a distributor of lifestyle fashion shoe brands, expects slow sales this year as revenue is expected to decline to 2.5 billion baht, lower than its earlier projection of 3 billion.
Mr Vipop (left) poses with another executive in a store. The sluggish economy and political tensions are expected to take a toll on Star Fashion’s revenue this year, as the Bangkok protests have taken a toll on spending sentiment nationwide.
The sluggish economy and political tensions are major obstacles, said managing director Vipop Tatiyamaneekul.
Sales in the first half of 2013 were good but started to decline gradually in the second half, especially in the fourth quarter, the peak season for shoe sales.
"Our sales in 2013 increased by 1-2% from 2012 compared with at least 20% growth in the previous five years," Mr Vipop said.
Although political protests have been centred on Bangkok, they have destroyed consumers' spending sentiment all over the country, he said.
As it is not clear when the political turmoil will end, Mr Vipop said Star Fashion may have to halt its expansion plan, at least in the first half of this year.
It will also try to reduce business risks by adding only 2-3 new brands to its portfolio instead of 4-5.
It will be more cautious over product merchandising, enabling it to manage its inventory more efficiently.
Mr Vipop said Star Fashion has cut costs by negotiating with modern trade operators to reduce rental fees temporarily at locations where sales were lower than projected.
The company has stopped selling some imported fashion shoe brands, especially those that did not give good returns, in order to cut business risks in the long term.
Mr Vipop said plans to expand into the food sector and branch out to neighbouring countries will be suspended as the company concentrates on fashion.
It plans to sell products online in the second half of the year to access new customers in provinces where its products are not available.
It also plans to open a standalone shop called Bratpack to provide streetwear products for men.
"As the number of middle-income earners continues to increase upcountry, we'll explore more business opportunities in provinces," Mr Vipop said.
About the author
- Writer: Pitsinee Jitpleecheep
Position: Business Reporter