2018 RETAIL ASIA-PACIFIC TOP 500
and garden specialist retailers, which were seeing strong growth
as a result of aggressive expansion by leading retailers such as
MR DIY, Courts and Ikea. Categories such as mixed retailers
and health and beauty specialist retailers also saw improved value
sales growth in 2017 as a result of the increase in the number of
outlets operated by popular brands such as Watson’s, Daiso and
Miniso. In non-store-based retailing, Internet retailing growth
was a key driver. Consumers in Malaysia are becoming increas-
ingly accustomed to shopping online and see the channel as a
convenient way to browse and shop for products. In response to
strong demand for online stores, companies in both grocery and
non-grocery areas are focusing on increasing their outreach and
presence in Internet retailing by launching new online stores and
mobile applications, and offering exclusive online promotions
and improved delivery.
Consumers shift to smaller and more convenient
grocery formats
In 2017, consumers in Malaysia tended to prefer stores that
offer a more convenient experience when shopping for grocer-
ies. Stores with layouts that are easy to navigate and provide a
comprehensive product offering are popular in urban areas as
they allow consumers to spend less time browsing for goods and
therefore enable them to reduce time spent grocery shopping.
Time-starved consumers living in urban areas prefer to visit
neighbourhood supermarkets, convenience stores and online
grocery retailers when grocery shopping. Neighbourhood grocery
stores that allow consumers to quickly drop by to top up their
daily grocery needs are becoming more popular than weekly
grocery trips at large hypermarkets that require consumers to
park their vehicles.
Demand for convenience is also fuelling the popularity of
online grocery stores. Companies in the grocery retailer category
have therefore launched online stores to tap into this demand
from tech-savvy urban consumers. These companies appeal to
consumers as they continuously widening product portfolios to
include new products, offering online exclusive promotions and
expanding delivery coverage. Well-known grocery retailer brands
such as Tesco and Mydin have recently launched online stores
targeting urban consumers who lead busy lifestyles.
Retailing remains fragmented, strong presence of
small independent businesses
Both local and international retailing brands have a strong
presence in Malaysia’s fragmented retailing industry. In 2017,
GCH Retail, Tesco, Mydin Mohamed Holdings and AEON
led value sales. However, the area remains relatively fragmented
due to the strong presence of small independent retailers, which
are especially prevalent in traditional grocery retailers and non-
grocery retailers. In many areas such as food, drink and tobacco
specialists, health and beauty specialist retailers and apparel
and footwear specialist retailers, small independent businesses
account for the bulk of value sales. Small independent retailers
commonly cater to regular customers in their communities and
appeal to consumers through personalised customer service.
These retailers have a connection with their consumers
and are thus constantly aware of customers’ needs. As a result,
these retailers are able to quickly respond to consumers’ require-
ments, despite carrying a smaller selection of products. Over
the