Malaysian jewellery designer and manufacturer Tomei Consolidated is closing non-performing stores to stay profitable.

It has shut four outlets already this year while realigning its business strategy, reports The Edge Financial Daily. Other than closing non-performing stores, Tomei will also focus on efficiency, introducing new products and repositioning its brand.

“We closed some stores in hypermarkets because the positioning is not how Tomei wants to be perceived,” says MD Ng Yih Pyng.

While other stores were upgraded, he says the company is being cautious about launching further outlets, though it has opened two stores this year.

Ng says the group has decided new outlets should be larger to allow for better product displays and to create ambience.

For its second quarter to the end of June 30, Tomei’s net profit ballooned more than 11 times to RM5.64 million (US$1.3 million) on a 57.9 per cent jump in revenue to RM169.17 million.

Exports up

Ng says the rise in earnings was partly a result of the group’s investment in gold bars and higher export returns as a result of the weaker ringgit.

Tomei had a net loss of RM1.72 million for 2015, bouncing back into the black last year with a first-half 156.4 per cent net profit surge to RM9.96 million.

In the first half of this year, revenue rose 45.35 per cent to RM334.85 million.

Interestingly, rather than comparing Tomei with other jewellery retailers, Ng says he sees more competition from smartphones.

“New models are being launched every year, and the younger generations prefer smartphones to jewellery. That’s why we have to come out with different products.”

Meanwhile, after closing its two remaining outlets in Vietnam, Tomei is left with just its manufacturing business there. However, Ng says the group is keen to stay in the market and seeking store locations.

Tomei may also look at building up its production force in Vietnam as the recruitment of foreign workers is becoming difficult in Malaysia.