KUALA LUMPUR (Feb 7): Hypermarket sales cannot be viewed as the only benchmark to gauge the economic condition of Malaysia and the people, Minister in the Prime Minister’s Department Datuk Seri Abdul Rahman Dahlan said in response to a hypermarket chain owner’s comment saying sales are slowing as Malaysians do not have enough money to spend on groceries.

In a statement today, Abdul Rahman said the share of hypermarket sales to retail sales is only 8%, based on numbers from the Statistics Department.

“Even so, retail trade in Malaysia has been recording strong growth, both in terms of value and volume. In terms of value, retail trade registered double-digit growth for three consecutive quarters in 2017, and in terms of volume, retail trade grew by 7.8%, 11.5% and 10.4% in the first, second and third quarter of 2017 respectively.

“Retail trade in the first 11 months of 2017 increased to RM410.5 billion from RM367.7 billion in the same period for 2016, a growth of 11.6%,” Rahman Dahlan said.

Mydin Mohamed Holdings Bhd managing director Datuk Wira Ameer Ali Mydin had said in a radio interview recently that hypermarket sales have been seeing continued contraction, which he said may be due to the people not having enough money, despite Malaysia recording high gross domestic product (GDP) growth. 

Abdul Rahman also said in his statement that the number of non-specialised stores which include hypermarkets, increased from 66,920 establishments in 2016 to 73,848 in 2017, which could be one of the factors behind slowing sales in some hypermarkets, as customers have more choices to shop.

The minister also cited growth of e-commerce transactions. He said business-to-consumer transactions totalled RM73.7 billion in 2016 and continues to grow year after year, as more people make their purchases — including for basic groceries — through the internet.

He said other indicators showed Malaysians in general have more money to spend, highlighting the 10.2% increase in domestic tourists’ expenditure to RM74.8 billion in 2016, with shopping making up the biggest component of domestic tourists’ expenditure at 35.5%.

Malaysian tourists’ expenditure abroad increased to RM33.5 billion in 2016 from RM31.1 billion in 2015, despite weakness in the ringgit, the minister added.

“All these figures are in tandem with rising median monthly household income of 6.2% per annum from RM4,585 in 2014 to RM5,228 in 2016, and soaring average monthly household expenditure of 5.9% per annum from RM3,578 in 2014 to RM4,033 in 2016, as reported in the Household Income and Expenditure Surveys by DOSM,” Rahman Dahlan said.

“While GDP has its own limitations and may not be the perfect indicator of welfare and wellbeing of the people, it does seem to correlate pretty well with broader qualitative measures of prosperity. As GDP grows, more jobs are created, household income increases and people have more money to spend,” the minister added.