Apparel and Footwear Specialist Retailers in Malaysia

PROSPECTS

Local players struggle in the face of competition from online and international rivals

Apparel and footwear specialist retailers experienced slow sales growth in 2019. Among the numerous factors holding back growth in the category was the recent surge seen in the popularity of online shopping.

Retailers respond to rising costs by revamping stores and refreshing brands

One particularly notable trend in apparel and footwear specialist retailers in 2019 was that growth in the number of outlets and the amount of retail selling space in the channel slowed down appreciably. The main reason for this noticeable slowdown is that operational overheads are increasing, notably the cost of renting retail space in shopping centres.

Government initiatives seek to unlock consumer spending power

Apparel and footwear specialist retailers is expected to continue registering steady growth over the forecast period and one major reason for this is that the Malaysian government has announced initiatives to help alleviate the financial burden faced by the country’s bottom 40% income group. This is set to be achieved through fuel subsidies, the Bantuan Sara Hidup financial aid scheme and adjustments to the minimum wage.

COMPETITIVE LANDSCAPE

Padini Holdings performs well due to local supply and store rationalisation strategy

At the end of the review period, Padini Holdings remained the leading player in apparel and footwear specialist retailers in Malaysia. The company is able to rely on the established reputation of its Padini retail brand and the wide range of products it offers, which are very much in keeping with the tastes of local consumers.

Storytelling of brand history becomes more influential for capturing luxury consumers

One area of apparel and footwear specialist retailers which remained unaffected by the slowdown in sales registered in the category towards the end of the review period was the designer apparel and footwear. This forms part of the wider positive sales trend being seen in luxury goods.

Digital players expand brand awareness, driving growth in store-based retailing also

Several of Malaysia’s leading online fashion retailers have recently expanded from e-commerce to launch bricks-and-mortar shops in a bid to establish a strong position as multi-channel retailers. These players include dUCk and Love and Bonito, with the latter of these operating seven outlets across Malaysia by the end of the review period.

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