RUNCIT MALAYSIA MAGAZINE ISSUE 19 PAGE 1 OF 36 TINJAUAN RUNCIT RUNCIT MALAYSIA MAGAZINE ISSUE 19 HAVE A GOOD START Let us start by wishing you a very happy New Year. Hopefully, 2010 will be a good year for us all. It is undeniable that 2009 was a tough one as we all had to face various challenges due to the economic downturn. Nonetheless, experts suggest that our country is recovering from it. Therefore, in this issue’s Rencana Runcit, we present to you a few “Reasons to Celebrate”. We paired several encouraging economic indicators with findings from our retailer survey to explain why you should look forward to the new year and more importantly, the festive sales. We hope it will help you prepare for the important period and make the most profit out of it. In line with the festive mood, we present a story on Yeo Hiap Seng (Malaysia) Berhad. Learn about its Asian Packet Drinks, in which Yeo’s holds the No 1 position in Malaysia. Also, read the double feature on MARIGOLD Evaporated Milk as well as MARIGOLD UHT Asian and Fruit Drinks. You will know why this brand is very popular with consumers, especially during the festive season. We have a special feature on noodles where we collaborated with MAMEE too. Read this interesting article to get some festive cooking ideas. In addition, we bring you closer to two very well known brands from Gentle Supreme Sdn Bhd: MI SEDAAP and DAIA. Another interesting section to turn to is the new Harga Runcit. From this issue onwards, we will discuss various topics on pricing, an area so important, it can make or break your business! We also feature an article on H1N1, a dangerous disease that is still going on in the country. Also, check out our regular columns like Urusniaga, Wang and Kedai for some very interesting and useful tips for yourself and your business. We hope you will enjoy reading this issue as much as we have enjoyed producing it. From all of us in RUNCIT MALAYSIA, we take this opportunity to wish “Gong Xi Fa Cai” to all our Chinese readers. May the Tiger year bring you a very successful business. For the rest of you, good luck in 2010! William Khoo Executive Director Infovantage Sdn Bhd [email protected] PAGE 2 OF 36 TINJAUAN RUNCIT RUNCIT MALAYSIA MAGAZINE ISSUE 19 FORECAST FOR 2010 Chinese New Year is coming on February 14, 2010. It also marks the beginning of the Year of the Tiger. For all our Chinese readers, here is a short forecast for this coming year. 2010 is the year of the Metal Tiger. This combination signifies the energy to begin an activity and the determination to follow it through to the end. It also represents the kind of force needed to accomplish the most difficult tasks. Hence, the impossible just might be possible this year. You may also find that things you did not manage to do before due to some problems will be done. Even if it doesn’t, you will see a significant progress in it. This is also the time to face the most difficult issues as you have the best chances to succeed. However, if you still have difficulties, consider postponing the attempt. In the year of the Metal Tiger, those who think will prosper but those who rush into action may experience serious setbacks. 2010 could be a thrilling and rewarding year for those who thirst for adventure and can handle their emotions. On the other hand, those who seek peace and harmony may find life to be a bit more difficult this year. ARE YOU A TIGER? You are considered one if you were born during a Year of the Tiger which are: 1902, 1914, 1926, 1938, 1950, 1962, 1974, 1986 and 1998. Source: www.proastro.com PAGE 3 OF 36 RENCANA RUNCIT RUNCIT MALAYSIA MAGAZINE ISSUE 19 REASONS TO CELEBRATE Have we passed the worst of the economic downturn? What can be expected of the coming year? Rencana Runcit helps you understand why you should keep your heads up in the new year. PAGE 4 OF 36 RENCANA RUNCIT RUNCIT MALAYSIA MAGAZINE ISSUE 19 WELCOME THE YEAR OF THE TIGER WITH OPTIMISM We are closing the curtain on 2009. As most would agree, it has been a challenging year. The economic downturn in the first half of the year posed real challenges to business. However, there seems to be some positive developments as we get closer to the year of the Tiger. Read on to find out why you should welcome the new year with a positive attitude. Global Economy is Better. The G-20 countries (G-20), whose economies comprise two thirds of the world population and 80% of world trade, spent $692 billion for fiscal stimulus (use of government spending and revenue collection to influence the economy) in 2009. By the third quarter of 2009, Gross Domestic Product, GDP (total market value of all goods and services produced over a period of time) in G-20 such as the USA, China, Japan, Canada, Australia and Indonesia have increased. The Government is Helping. In March 2009, the government announced a RM60 billion stimulus package. The money was used to counter the effects of the global financial crisis on Malaysia: loss of jobs and the reduction in credit flow to businesses and private investments. Our GDP Has Gone Up. The reading was -7 from January to March 2009 but rose to -4 in the following quarter. This shows that we are recovering from the economic downturn. The BCI Has Increase. The Business Condition Index (BCI), an indication of manufacturing activities in Malaysia, increased tremendously in the second quarter and continued to increase in the third quarter of 2009. Employment Rate is Increasing. Our employment index was very low in the last quarter of 2008 but it has been increasing since the start of 2009. Our labour market is recovering and the current and expected incomes are steady. Consumers are Optimistic. Our Consumer Sentiment Index (CSI), an indicator of consumer confidence on the state of the economy, has increased tremendously and passed its 100-point threshold in the second quarter of 2009. It remains the same till the third quarter. PAGE 5 OF 36 RENCANA RUNCIT RUNCIT MALAYSIA MAGAZINE ISSUE 19 GEARING UP FOR CHINESE NEW YEAR Having known the reasons to celebrate the coming of the year of the Tiger, you must now make sure that you are well prepared for the much awaited festive sales. To find out your expectations and preparations for it, Runcit Media Sdn Bhd ran a survey from October 6 till November 7, 2009 where 584 retailers from Peninsular Malaysia were involved. The following are the findings of the survey. Sales Will Increase • Most respondents are optimistic about the festive sales. • Side the majority because consumers no longer seem to be tightening their wallets. • Plan your promotional activities carefully to make the most out of the situation. Cheaper, Smaller, Later • Knowing your shoppers’ purchasing habits during the festive season will help you plan better promotional activities. • While shoppers are still spending, they are becoming more cautious and try not to overspend. PAGE 6 OF 36 RENCANA RUNCIT RUNCIT MALAYSIA MAGAZINE ISSUE 19 Plan Ahead, Stock Ahead • Most retailers start stocking a month before the festive season but this does not allow for thorough preparation. • Start stocking two months prior to the festive season. This will give you enough time to plan which products to stock on, avoid delivery problems and even get better deals from suppliers. • If you never plan to stock earlier, start now as this will help you gain more festive sales. Help from Suppliers • You should try to get help from suppliers as stated above as they will help drive your festive sales and manage your cash flow and space better. PAGE 7 OF 36 RENCANA RUNCIT RUNCIT MALAYSIA MAGAZINE ISSUE 19 WHAT’S NEW IN THE MARKET? Chart 5 shows that while most are optimistic about the increase in sales, they are only expecting moderate increase in the popular categories. Apart from stocking up on them, these are some interesting insights into several categories to help you drive better festive sales. Carbonated Soft Drinks (CSD) While consumers still like popular flavours like cola, orange and strawberry, many of them also opt for isotonic drinks which fall under this category. Apart from providing energy and keeping them hydrated, injection of flavours like lemon and orange also attract consumers to choose isotonic drinks. You may also consider stocking up on CSD with less or no sugar and caffeine to cater to the more health conscious shoppers. Asian Packet Drinks (APD) Convenience, taste familiarity and suitability with local climate are what drive this category. Manufacturers are taking a lot of initiatives to drive sales of APD especially during the festive season. For example, consumers can now enjoy soya with addition of corn, rose and cincau. Other more traditional drinks like cheng bou leong and lou han guo are also available now in this convenient format. Biscuits Biscuits are no longer enjoyed only during teatime or breakfast. Since they are now available in so many formats, flavours and pack sizes, consumers are opting for biscuits as festive snacks. In addition, so many health propositions are being made by biscuits manufacturers in the attempt to appeal more to the older and health conscious consumers. Juices & Fruit Drinks A lot of new flavours like mangosteen, soursop, ciku and mata kucing are being introduced to this category, making it more appealing to consumers during the festive season.