Thailand retail growth trails other destinations
While Thailand retail industry growth is up slightly and there have been more international tourists, more Thais are shopping abroad, and tourists are spending more in other regioanl destinations.
Thailand’s first-quarter growth in the retail industry was 2.6 per cent – failing to hit the Thai Retailers Association (TRA) projection of 3 per cent.
President Jariya Chirathivat says same-store sales growth for several retail formats declined year-on-year, particularly hypermarkets and convenience stores.
“This is the first time in two decades that Thailand’s retail industry has [shown] declining rates for several years,” says Jariya. Growth has fallen from 12 per cent in 2012 to 2.8 per cent last year.
She says retail consumption has weakened because of declining farm product prices hitting the purchasing power of middle- and low-income consumers.
While there were 12 per cent more foreign tourists in Thailand last year (29.5 million), there was no effect on the sales of semi-durable goods such as clothes, make-up, leather products, shoes and watches.
Tourists in Singapore and Hong Kong on average spent 1900 baht (US$54) and 5300 baht ($150)respectively per head per day, while the figure for Thailand was 1155 baht ($33).
Tourism Authority of Thailand figures show that the number of Thais shopping abroad grows by 9 per cent a year. Thais spent 170 billion baht on shopping overseas last year, with brand-name products accounting for 50.8 billion baht.
“We’re concerned the retail industry might not be able to maintain investment levels in the long run if consumer spending continues to decline,” says Jariya.