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Malaysia’s retail Future growth looks good Malaysia is in the third quartile in Entry Point Projects (EPPs) and

Malaysia is in the third quartile in Entry Point Projects (EPPs) and Business Opportunities (BOs) Common enablers must Executive Impact Summary
sector top 10 in Asia, ¥ Increasing GNI per capita to RM48,000 (USD15,000) terms of retail spend per capita be addressed
6% Compound ¥ Migration to urban areas (75% by 2020) Lab Scope Aspiration Malaysia has done well in retail sector

RM350 billion
Malaysia is in the 3rd quartile among 100 countries in terms of GNI per capita, with the retail spend per – Malaysia's retail sector was top 10 in
¥ A young population (54% below 30 in 2020) capita trailing Korea, Taiwan, Singapore and Hong Kong, despite parity in 1970s 1.Store-based retailing 2.Non-store Retailing 1 Asia and analysis show that the market

Annual Growth Rate ¥ Overall growing population will drive retail demand 1st Quartile 2nd Quartile 3rd Quartile 4th Quartile a.Grocery retailers b.Non-Grocery Retailers Transform distributive trade…… Financial
Liberalisation Supply Demand
has 6% CAGR growth potential for
2010-2020 period
(USD109.4 billion)
MODERNISE
Requirement

(CAGR) growth
Luxembourg 105 Greece 30 Lithuania 11 Suriname 6
Norway
Qatar 69
79 Cyprus
New Zealand 27
30 St Kitts Nevis
Eq Guinea
10
10
Saint Lucia
St Vincent 5
6
1. Hypermarkets1 /Superstore2 (Large format) 1. Mixed retailers /Duty free 1.Vending
Switzerland 68 Isreal 27 Libya 10 Dominican Rep 5 2. Supermarkets 2. Health and beauty specialist 2.Homeshopping
Future growth looks good - increasing
Revenue in 2020
Denmark 56 Brunei 26 Chile 10 Belarus 5
3. Discounters 3. Clothing and footwear specialist 3.Internet retailing

potential for GLOBALISE


Ireland 51 Slovenia 24 Uruguay 9 Colombia 5

Asia Pacific retail Netherlands


UAE
48
47
Bahamas
Portugal
22
21
Seychelles
Turkey
9
9
Dominica
Azerbaijan
5
5 4. Food/Drink/Tobacco specialists 4. Home and garden specialist 4.Direct selling GNI per capita to RM48,000, migration
5. Home furnishing and housewares to urban areas (75% by 2020), a young
2
US 46 Bahrain 19 Lebanon 9 Namibia 5
Austria 46 Malta 19 Russia 9 Macedonia 4
Australia 46 Czech Republic 19 Brazil 8 Iran 4
6. Electronics and appliance specialist Human Regulatory population (54% below 30 in 2020) and

2010-2020 REVOLUTIONALISE
Asia Pacific retail sales are forecast to reach RM14.66 trillion in 2014 Finland 44 Oman 18 Mexico 8 Jamaica 4
Infrastructure
South Korea 7. Leisure and personal good specialist overall growing population all drive retail
Capital Framework
Sweden 44 17 Argentina 8 Peru 4
Belgium 44 Taiwan 16 Romania 8 Bosnia 4
China will dominate the regional retail landscape 8. Convenience stores
demand.
France 43 Slovakia 16 Gabon 7 Ecuador 4
Germany 41 Trinidad and Tobago 16 Panama 7 Belize 4

Across Asia Pacific, Japan 40 Saudi Arabia 14 Kazakhstan 7 Algena 4 9. Forecourt retailers
Malaysia
Asia Pacific forecast growth 10. Automotive
Canada 40 Estonia 14 7 Angola 4

the retail sector is set Iceland


Singapore
38 Croatia 14 Mauntius 7 Thailand 4

But it could be better – despite being at


to grow by 72% over a +72% Italy 35
37 Antigua and Barbuda
Barbados
14
13
Botswana
Costa Rica
6
6
Maldives
Tunisia
4
4
11. Food and beverage …..and deliver additional GNI results
Hypermarket – floor space above 5000 square metres
parity with Singapore, Taiwan and Korea
1
UK 35 Hungary 13 Bulgaria 6 Jordan 4

five year period Superstore – floor space above 3000 square metres

3
4 2

PAKAR 1Malaysia mall Virtual mall


Spain 32 Venezuela 12 Grenada 6 Albania
Kuwait 31 Latvia 12 South Afica 6 China 4
in 1970s, Malaysia is now in third quartile
(2009-2014) RM14.66
Hong Kong 30 Poland 11 Serbia 6 El Salvador 4

in terms of retail spend per capita

RM107.8
We require enhanced policy Government to negotiate for 10 Broadband penetration and quality
Key Markets: trillion Source: Euromonitor, Provectus analysis
framework, funding, location, prime locations ( between six to 30 of service which is already planned vis-à-vis these countries.
infrastructure and supply chain. acres), seek approval of all relevant for by Telekom Malaysia must be
China Retail spend per capita in Malaysia is about a quarter of Singapore and Taiwan; a third of Korea.
Ranked eight in retail study of 30 growth economies in 2007 India RM8.51
trillion
These are to be achieved
through coordination between
development licences for the
physical malls, umbrella retail
in place faster and wider.
Processes and system related to
There are specific opportunities that
could be monetised – We have

billion
SOUTH KOREA
Hong Kong
RM38.2 billion (USD14.13 billion) from 13 EPPs
Federal Agriculture Marketing licenses for all Malaysian retailers
online ordering and order fulfilment
Retail index (year 2007) USD111.9 billion
Authority (FAMA) and the local in these malls, work permits for identified Entry Point Projects and
Indonesia INDIA USD2295.1per capita to be developed to ensure that the
92 Malaysia
USD202.4 billion authorities. Malaysian management/
targeted customers have a high 4 Business Opportunities across the value

RM45.2 billion (USD11.94 billion) from BOs


Malaysia ranked eight in a global index for retail
India USD168.9 per capita JAPAN supervisory personnel, and chain worth RM83.4 billion (GNI),
CHINA USD10984.8 billion degree of confidence in the service
74
business opportunity Vietnam
Chile 69
Philippines USD844.8 billion USD8582 per capita
KLIA retail hub repatriation of profits.
quality. producing 364,686 jobs by 2020 for
The growth prospects of 30 leading economies
Singapore USD695 per capita
TAIWAN Land lease extention and convert
Government to initiate market implementation by the private sector

(USD33.69 billion)
were considered. Ukraine 69 (research) studies in the target
2010 2014 VIETNAM USD71.8 billion
the land usage from agriculture Wellness resort with government support .
The ranking criteria have four broad strategies: Russia 69 USD21.1 billion USD3115.2 per capita countries, covering location, mall
Three themes prioritised
• Country risk to commercial use. Ease the
China 68 USD240.1 per capita HONG KONG Spend per capita growth, size, target market appetite; cost MOTOUR to enhance visa
• Market attractiveness
• Market saturation, and
Latvia 68 Malaysia retail THAILAND
USD31.1 billion
USD4400.6 per capita
urbanisation,population
The Lab estimates that RM45.2 billion will be
from Business Opportunities and
The RM38.2 billion GNI will
in terms of impact to Rakyat
policy on terminal bound transit
passenger by issuing temporary
for this initial research can be processing for the target market
segment and promote the setting
Funding is largely private – This would
require RM66.7 billion private investment
additional GNI in 2020
Malaysia 68 USD56.2 billion growth and trend synergies accrue from 13 specific EPPs passes to visit these retail
recovered from mall developers
• Urgency for a new entrant to start retail
business Mexico 64 Malaysia is classified as an upper middle income country by the World Bank
USD868.8 per capita PHILIPPINES
USD53.4 billion will drive the BOs
RM38.2 billion will be from EPPs
and ease of implementation offerings.
taking up the EPP. up and delivery of medical
insurance schemes to cover 5 and RM2.4 billion in public investment.
This sector will play a major role in
Malaysia had an aggregated score of 68. Saudi Arabia 64 USD580.4 per capita
professional liability issues pre and
Malaysia’s total retail sales forecast is RM92.4 billion in 2010 and expected to be INDONESIA Big box boulevard United sales producing much of the required private
MALAYSIA
Tunisia 64 post treatment.
Bulgaria
RM123.5 billion in 2014 USD77.3 billion
SINGAPORE Trend 1 1 TUKAR Expansion of second link (Tuas) investment stated in 10th Malaysia Plan.
63 Malaysian retail USD326.2 per capita
USD12.4 billion USD24.9 billion Ministry Of Tourism (MOTOUR) to The Malaysian Medical Association
Average consumer spending was RM2,285 per month in urban areas and customs capacity.

MODERNISE
market is expected to USD3422.8 per capita USD886.2 per capita 2 PAKAR support via overseas advertising (MMA) and the Ministry of Health
grow by 34% in the RM1,301 per month in rural areas (2009) Retail spend Within 36 months Within 18 months Relaxation of skilled and promotions campaign. to enhance current medical Human capital development is critical
growth 22.2 3 Automotive workshop - The planned development requires

595,400
Source: Euromonitor from trade sources/ national statistic, Provectus analysis
2009-2014 period Urban population is predicted to account for 76% of total population by 2015 migrant/foreign worker rules. Ministry of Domestic Trade, regulations that limit foreign
modernisation

Malaysia is an attractive investment option, overall retail


according to United Nations (UN) data. In absolute terms, Malaysia has declined from eight position in the retail market ranking
in 2007 to 13 in 2008 and 17 in 2010.
4 Makan bazaar
11
10 MRT/LRT extension for
Nusajaya.
Cooperative and Consumerism
(MDTCC) to pull all sectors
medical talent movements, and be
more open to advanced medical 6 7,739 senior management jobs, 11,608
managerial positions supported by
This is likely to have positive impact on retail sales Trend 2 38.2
market far from saturation
together and streamline the practices which are available in the 18,932 technical and professional and
Market attractiveness vis-à-vis other global and regional markets. 5 Large format growth
2 United States (Mayo Clinic),
Large format growth implementation of ‘Unified 326,408 staff.
Malaysia’s total retail Consumer spend RM per household Urbanisation 12 1 Malaysia Sale’. Switzerland and Korea.
additional jobs created

Impact Rakyat
Retail market attractiveness assessment (year 2009) per month 9 5 Allocation of funding in the form

GLOBALISE
Retail Market Ranking 6 1Malaysia mall 3 of commercial loans, asset Duty free Malaysia Jabatan Kemajuan Agama Islam Common enablers must be addressed (2020 total)
45.2 Malaysia (JAKIM) is to provide
Global economic crisis has not affected Market attractiveness
2007 2008 2009 2010
145.4 7 Virtual mall 7 4 buy-out and leasing or as equity
Government to implement the duty Halal certification for the
– Identified categories of enablers are
7
2007 2010 partner via government linked
investment opportunities in the retail sector of 70 rank Country rank Country
Trend 3 removal for the selected goods procedures and locations. financial support requirement, market
Chile 50 2010 investment companies will assist
emerging economies. 88 1 India 1 China 8 Foreign brand acquisition and promote Malaysia as a duty liberalisation, supply and demand
Brazil, Russia, India And China (BRIC) 60 Russia 49 32 Brazil UAE 2020 2 Russia 2 Kuwait Population 6 the local players to catch up
free destination to the locals and management, infrastructure, regulatory
49 +34%
RM254 RM370
3 India
economiesare expected to be robust (OECD
Malaysia
Slovenia 3 China 4 Saudi Arabia increase 8 tourists. framework, human capital.

REVOLUTIONALISE
estimates) and we have seen 10.2% GDP growth 50 4 Vietnam 9 Wellness resort Makan bazaar
for Q1 in Malaysia. 52 32 4,428 5 Ukraine
5 Brazil
TUKAR

billion million
40
China
53 Saudi RM123.5
6 Chile 62.1 10 Duty free Malaysia 13 Assistance in securing Implementation governance and follow
Emerging markets remain attractive to retail billion 6 Chile 7 United Arab Emirates
Arabia 8 Uruguay Trend synergies strategically located land. The government is expected to through is vital – we see a major role for
India 14 2,521 7 Latvia
investment, especially the BRIC markets. RM92.3 2,427 9 Peru 11 Unified Malaysia sales
30 billion 8 Malaysia Assistance for financing is also promote the modernisation effort MDTCC in ensuring the enablers are
8
Malaysia, despite governance and policy issues, 10 Russia Med High
9 Mexico through the funding requirement
remains an attractive investment target vis-à-visthe 1,382 10 Saudi Arabia
11 Tunisia 12 Big box boulevard Else of Implementation required for the Makan Bazaar
that the Lead Ministry (MDTCC)
streamlined effectively; measuring and (USD79.38 billion) (USD115.63 million)
20 26 Vietnam 12 Albama construction.
other emerging markets, especially seen in terms Bubble size defines how much 11 Tunisia 13 Egypt
Less overlaps Base BOs Lab EPPs Multiplier 2020 has submitted for approval in 10th
reporting the EPP progress; facilitating the Private Investment Private Investment
of market saturation which is comparable to China of the retail market is available 12 Bulgaria China 14 Vietnam from EPP 13 KLIA retail hub Legend Modernise Further assistance via micro funding activities and continuously for 2010-2020 period for 2010-2020 period
10 (i.e. unsaturated)
Malaysia Plan.
India
In 2020 (RM billion) Globalise financing is also needed to be
and better than India and Russia. 13 Turkey Vietnam 15 Morocco improving business processes.
16 Indonesia Revolutionalise made available to the street
2010 2014 Urban Spend Rural spend 14 Egypt Malaysia
17 Malaysia
0 10 20 30 40 50 60 70 80 90 100 hawkers wanting to upgrade
Source: A.T. Kearney report, Provectus analysis Country risk Source: BMI, World Bank Report, Provectus Analysis Source: A.T. Kearney Global retail Development Index, Provectus analysis Source: Lab output, Provectus analysis and improve their business.
Source: A.T. Kearney report, World Bank Provectus analysis

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