How empty will shopping malls be after MCO is lifted?

by Sharina Ahmad 

SHOPPING malls are gearing to seeing fewer visitors after the movement control order (MCO) is lifted due to lingering fears of the Covid-19 pandemic.

However, getting Malaysian consumer spending back on track soon is seen as imperative for the health of the domestic economy and the many people whose livelihoods depend on the retail and restaurant sectors.

During the MCO most retailers in Malaysia experienced a sharp decline in sales and the situation does not seem to be improving in the near term.

According to the Malaysia Shopping Mall Association, it is estimated that the losses for the retail industry could be around RM5.2 bil to RM6.2 bil in lost sales this year.

Malaysia Retailers Association (MRA) president James Loke said once the MCO is lifted, people will still be visiting malls but the number is expected to decline by 30% to 50%.

“We are sure that the malls will not be totally empty, but social distancing will become a new normal since people would still fear being infected by the virus. However, we are not expecting to see a return in footfall at malls in the near term; maybe a full recovery of the industry will take up to a year,” he told FocusM.

Loke noted that the landlord needs to rebuild customers’ trust and confidence by providing a standard operating procedure (SOP) such as taking body temperature and providing hand sanitisers.

“Their (customer) safety must be taken care of so that they can shop peacefully without any fear,” he added.

Retail design firm Visata Creative Sdn Bhd co-founder Timothy Liew said malls will still see visitors but less of them even as people need to go out after being mostly cooped up at home for more than a month.

“As such, they will be wanting to go out somewhere and I think the easiest will be the malls. However, it is important for the malls to put in place necessary safety precautions to ensure that visitors feel safe, along the lines of limiting the number of people within the mall at any one time,” Liew told FocusM.

He foresees retail opening up in stages and as such, hardware and electrical stores will be among retailers that will first to open their business followed by non-essential retail stores. “Probably the last retail to open will be those that require large gatherings such as cinemas.”

Liew was sure there would be no “instant” recovery but felt that strong promotions with the emphasis on giving customers value for their purchases will help customers to be more willing to spend.

“It is important for retailers to remember that most customers will have had their earning capacity impacted from the MCO through pay cuts or some might even have lost their jobs.

“Hence, customers will favour spending with brands which are perceived to understand their current situation and those brands will stand to win immense brand loyalty coming out of this MCO,” said Liew. – April 22, 2020

Subscribe and get top news delivered to your Inbox everyday for FREE