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Retailers hit as spending tightens

By on Jul 11, 2013 in Property News

Household Debt Limited Private Consumption in May

Rising household debt and falling prices of agricultural products are pinching the purchasing power of lower- to- middle- income consumers, while reduced demand has sapped sales at a wide variety of local businesses ranging from retail to property.

“We have seen a plunge in the purchasing power of people at the grassroots level due to the big slash in crop prices,” Chatchai Tuangrattanapan, Director of the Thai Retailers’ Association (TRA), said last week.

The Association has revised down its growth forecast for retail sales from 12% to only 8%-10%, in line with the signs of a bearish slowdown in spending, which has been witnessed since May, particularly in the grassroots segment. Retailers selling non-durable goods, such as convenience stores, hypermarkets and supermarkets, have suffered the most.

Thailand’s Development Research Institute (TDRI) recently revealed that sales at those store ‘likely to drop by 0.7% this year, he said.

“We, ourselves, have projected that, this year’ sales by modern retailers non-durable goods will increase by only 3-5%,” he added.

Just recently 7-Eleven cut its sales target to 5%-10% for this year from 15%.

However, the TDRI estimates that sales at department stores will increase by 2.7% this year and 2.7% next year, while the TRA sees department store sales surging by 5%-8%.
To continue reading, visit http://www.nationmultimedia.com/business/Retailers-hit-as-spending-tightens-30209413.html

Source : The Nation 1 July 2013

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