Habitat Thailand thriving on return
A decade after its first aborted foray into Thailand, UK-founded furnishing and homewares retailer Habitat is thriving in Bangkok.
Habitat Thailand has just opened what – for the time being – it is describing as its flagship store under the management of local brand partner SB Furniture. The new store, taking up 1400 sqm on the third floor of the revamped Siam Discovery shopping mall is the fourth in Bangkok, and the first stand-alone store. The others are stores-in-stores within larger SB stores: a 1400 sqm space at Crystal Design Center, a 1300 sqm site in Bangna and a smaller 840 sqm space at The Crystal SB Ratchapruek.
“We wanted to stock exactly what a Thai person would see if they walked into a Habitat store in Paris,” Suthida Vijitkulwongsa, executive director of Habitat Thailand, told Inside Retail Asia.
She says a fifth store is planned by the end of this year and the company is evaluating opportunities in larger cities outside Bangkok.
Habitat Thailand is licensed by the French based company Cafom which bought Habitat Europe after the UK company was placed in administration in June 2011.
Despite a 10 year absence from the Thai market, a number of loyal local customers have emerged since it made its return in June 2015. When the brand was reintroduced, some 80 per cent of shoppers were “Habitat lovers” familiar from the brand’s previous foray here, says Vijitkulwongsa.
“They had known about Habitat in past years and were wondering what had happened to the brand and why it had disappeared. They think we have done well in terms of pricing.
“Ten years ago our prices were equal to what they are now.
Given the current stagnancy of Thailand’s retail sector – which has seen a number of shopping centre developments put on ice this year – is this really the time to reintroduce an overseas brand considered to be in the premium space?
“When you have a very strong brand [the market] doesn’t really have much impact. People who are in the market now, who have influence and social status, they’re not really impacted. Instead of buying 10 pieces they end up with eight. But they still make the purchase, probably based on price and design.”
Perhaps surprisingly, Habitat Thailand sources its stock from the French warehouse, rather than direct shipped from factories in Asia. About half the range is manufactured in Europe, mostly in the eastern nations. With a two month lead time for stock orders, Vijitkulwongsa maintains a large inventory in Bangkok to ensure the brand can meet customer demand without long waiting times.
Cafom is bullish about its prospects in Asia, especially in China where a rapidly-rising middle class is aspiring to own European-designed products, even if almost 50 per cent of them are made in China. Besides Thailand and China it is now also present in Hong Kong and Singapore. In the Philippines, Habitat has partnered with the same company operating SB furniture stores under license.
“The new French owners are very experienced in hypermarket operations and in French Polynesia. They have very strong sourcing skills and they have rejuvenated the design. The designers have done well. They have created products which are useful, beautiful and affordable.
“France has been doing a great job taking over the brand, building it back up and adding value to its offer,” says Vijitkulwongsa.
She believes her customers appreciate the simple yet functional design of the Habitat products. “If the product is good enough in terms of function, if the price is right, then fashion is probably a plus.”
For now, Habitat Thailand is not selling stock online, but it does maintain a website with its range and pricing information. If an eCommerce site is to come, it will most likely be developed by Cafom to serve all international markets.
Meanwhile, SB Furniture has a dozen stores across Thailand and in partnership with local entities has stores in Vietnam, the Philippines and Indonesia. It also has a presence in Cambodia, Laos under different brand names and is carefully looking at the opportunities in Myanmar.