Sunday, 18 September 2011

Will 1 Malaysia shop ruin the Malaysian retail scene?

Chinese businessman Tan Sri William Cheng's comment that the Government's low-price retail outlets named 1-Malaysia shop may cause hardship to other retailers sounds hollow because the 1-Malaysia shop will attract only a certain type of buyers.

Just because Perodua and Proton sells low-priced cars it doesn't mean that Mercedes-Benz, honda, Toyota or Kia would go bust because there are those who want something of a different category than the lowest-priced items.

Clearly Cheng is voicing the concern of holesalers and retailer who want to maintain their fat margins and despise any kind of healthy competition.

Some say his threat of  taking his steel business to Indonesia is part of an effort to snub the current Government and threaten them frm expandng the 1-Malaysia shop network.

The fact is, Malaysia is a far more desirable location for business than Indonesia and if he really wants to go across the straits then I say we should encourage him.

The 1-Malaysia shop is an intelligent way of supporting the low income group without creating unnecessary dependency on Government subsidies and grants. As a low-price outlet the 1-Malaysia shop will not offer luxury items at a discount and this is something that all Malaysians should bear in mind.

If greedy wholesalers and retailers have a problem with this, they should all migrate to Indonesia.

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