Lotus's expansion on track with B13bn to be invested
Up to 80 new shops to open in 2nd half
Ek-Chai Distribution System Co, the operator of Lotus's hypermarkets, is moving ahead with plans to allocate 12.5-13.5 billion baht this year to expand its business.
Sompong Rungnirattisai, the company's chief executive, said the spending will focus on opening new Lotus's stores, refreshing existing stores to become "Everyday Smart Community Centres" for customers, and upgrading IT infrastructure and online systems.
In the first half of this year, the company spent more than 6 billion baht opening 39 new stores and introducing new store concepts that cater to the lifestyles of customers in specific locations, including the Smart Urban Supermarket concept at Nuan Chan Road, Smart F&B Heaven at the Sutthisan location, and Open Air Mall at Liap Khlong Song Road, Klong Sam Wa District, in Bangkok.
The company also refreshed 629 existing stores in the first half of this year.
According to Mr Sompong, in the first six months the company rolled out Lotus's Smart App, an application that combines e-commerce with a personalised reward programme. The app has been downloaded more than 4.5 million times and has been instrumental in the company's online sales growth, he said.
As of July 31, the company had a total of 2,279 stores. Of the total, 224 are hypermarkets, 203 supermarkets, and 1,852 are mini-supermarkets. With the company's expansion plan, the total number of Lotus's stores is expected to top 2,350 by the end of this year.
"We've started to see positive signs of consumer spending since the second quarter of this year and anticipate an economic recovery in the second half of this year,'' Mr Sompong said. He said the recovery was driven by better tourism sentiment, higher consumer spending power boosted by the government's stimulus packages, more private investment, and rising public confidence in spending time outside of the home.
According to Mr Sompong, in the second half of this year the company aims to open 70-80 Lotus's stores, including Lotus's North Ratchapruek and a new Lotus's smart premium supermarket opposite the Iconsiam shopping complex. Lotus's smart premium supermarket is an urban supermarket for urban customers that has a new look and feel. The company will also refresh its existing 208 stores in the remaining half of the year.
Mr Sompong said the company will put more focus on opening small retail formats, notably under the "Lotus's go fresh" brand, thanks to its growth potential.
The company will open 200 "go fresh" stores next year.
According to Mr Sompong, the company also plans to upgrade its fresh food unit by selling imported products or premium products that fit the demand of consumers in each location.
A wider array of food and beverage tenants are also being added to Lotus's shopping malls.
In a related development, to cope with rising electricity costs the company plans to use more solar power at each store, and aims to install solar roofs at all big Lotus's branches in the third quarter of this year.
"By doing so, it will help reduce risks occurring from a hike in electricity bills," Mr Sompong said.