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Central plans Asean stores

By on Jul 11, 2012 in Property News

Central Department Store, a subsidiary of Central Retail Corp, has drawn up a five-year strategic expansion programme, the first part of which involves opening at least three stores elsewhere in Southeast Asia at a combined cost of more than Bt1.5 billion.

Yuwadee Chirathivat, president of Central Department Store, yesterday said the company would in the next few months reach a final leasing agreement with a local mall operator to open its first department store outside Thailand in the region.

The company is not, however, at this stage prepared to name the countries in which it wants to invest, saying only that is open for joint ventures with local partners.

The regional expansion is in line with the company’s overall strategy aimed at cashing in on the Asean Economic Com-munity’s (AEC) coming into effect in 2015.

The company has set its ambition to become a leading department-store player in Asia within the next 10 years in terms of sales. It has appointed a new executive as head of the international market, Southeast Asia, to look after regional expansion.

Central Department Store, which celebrates its 65th anniversary this year, also plans to open four or five new stores domestically within the next five years.

Each store will require a capital investment of between Bt500 million and Bt800 million, and up to Bt1.2 billion for those also requiring construction.

“Regarding the AEC, the Thai government has yet to put in place any urgent measures or framework to help the private sector to prepare itself to meet the new open-market environment, when the AEC comes fully into effect in the next three years,” said Yuwadee. “The local retail sector, however, is quite strong and competitive, particularly in department stores and discount stores.”

She added that the AEC should be relatively positive for all Asean member states. Much will, however, depend on how sincere they are on trade and other kinds of collaboration, as Asean members will have to compete against each other at the same time.

“My only concern at this time is the political issue, as it is a crucial factor that makes Thailand lag behind the others in Asean. In my opinion, all stakeholders [in Thai politics] should play a fair game and follow the rules and regulations of the country,” said the executive.

She said that throughout |the past 65 years, the company had been determined to be |committed to the determination its founding father, Samrit Chirathivat, namely, “Our success grew out of our determination to bring Thailand into the modern world. We are committed to contributing to the country’s prosperity and enhancing the quality of life of the Thai people.”

“This is the Central team’s ultimate working goal, to which we always keep. We are inspired to continue this determination and develop our current vision for the organisation, which is that we will be always be committed to be Thailand’s leading department store and introduce products in new ways, full of quality and variety as well as exciting displays and excellent services that are beyond customers’ expectations,” said Yuwadee.

The company operates 15 department stores in Thailand and three in China, in Hangzhou. A fourth Chinese store will be opened in Chengdu by the end of the year.

The company expects to grow by 16.2 per cent to about Bt35 billion in overall sales this year.

For new domestic operations, Yuwadee said two more branches would be opened next year, Central Festival Hat Yai in October and Central Festival Chiang Mai in November.

Each branch will have an area of more than 25,000 square metres and cost about Bt1.2 billion.

Source : the Nation 11 July 2012

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