Central Retail Corporation plans to invest over 12 Billion THB on Local and Overseas Expansions

Business Press Releases Tuesday July 1, 2008 07:39

Thailand’s leading retail company, Central Retail Corporation has set aside 12 billion Baht for business expansions and renovations. New branches openings of Central Department Stores Changwattana and Pattaya, Robinson Department stores Cholburi, Khonkaen and Ubonrachathani. The launching of it’s new retail format ‘TOPS-stand-Alone’ at Udomsuk. Moreover, a new merchandising management system has been acquired to increase the company’s efficiency in merchandise management. Growth for 2008 at year end is expected at an increase of 9 % over last year, totaling 87 billion Baht in sales revenue.

“During first half of 2008, we gain 40.6 Billion Baht in sales revenue, a 7% increase over the same period last year. This year we have allocated 12 billion Baht for expansion investments in both domestic and international mega-projects in order to penetrate new market. For example, Central Retail’s new retail format ‘TOPS-Stand- Alone’ or Tops Market Place Udomsuk, will be opened in addition to 3 HomeWorks Mega store and 3 branches of Robinson Department Stores. Of late, we have taken over Siam Makro’s Office Centre, the office supplies business. Investment in improvement of merchandise management system is also been acquired to increase efficiency” says Chief Executive Officer of Central Retail Corporation, Tos Chirathivat.

Major Investments are focused on domestic business expansion which 8 department stores are expected to open in the next 3 years, 6.6 billion baht for Central Department Stores Chaengwattana and Pattaya, Robinson Chonburi Khonkaen and Ubonrachathani and three non-disclosed retail projects in Chiang Mai, Chiang Rai and Rama 9. ZEN Department Store has invested 80 million Baht for “ZENSE”, with its concept aligning with Earth – Water – Wind and Fire. Earth represents the cozy restaurant for Thai, Italian, Japanese and Indian cuisines. Water represents ZENZY Bar, featuring a full-service bar. Fire represents the modern fine grill menu served along premium wine and Wind represents the rooftop bar providing a view of central Bangkok. The first phase of the restaurant on level 17 will be opened in mid September 2008.

In regard to specialty store, Central Retail is expecting to launch HomeWorks Phuket in October, it is to become the largest mega-store for home improvements and D.I.Y. equipments in Thailand, with 25,000 square metres space to meet increasing demand of Thai and foreigners customers. Another two branches of HomeWorks, are designed as lifestyle malls located at Sri Nakarin Road and Rachapruek Road. Total investment is 2.5 billion Baht. Recently, Central Retail has taken over 16 Makro’s Office Centre stores to merge with Office Depot, increasing its store to 35 branches. The acquisition budget cost totals 400 million baht. Central Food Retail has invested 500 million baht for 13 stores renovation last year and for another 15 stores this year.

“Tops-Stand-Alone”, a new retail format will be launched this July under the name “Tops Market Place” at Udomsuk, project area total 5,000 square metres. The company expects to open 3 Tops-Stand-Alones per year with a budget of 150 million baht per site. Moreover, it has transformed 2 Central department stores to meet with customers’ need. Central Department Store Wangburapa has been rebranded “China World”, a wholesale centre for fashion clothes and accessories, now accepting tenants to reserve sale spaces while Central Silom Department Store has been renamed “Tops Market Place Silom” and includes an office building, retail shops and banks within. The change took place in February this year.

In 2009, Central Retail Corporation will make a move into the overseas market by opening it’s first department store under the brand of Central Department Store in the city of Hangzhou, Zhejiang Province, People’s Republic of China. The department store, occupying approximately 23,000 square metres of space on 4 stories will be located within MixC Shopping Center, the largest shopping center in Hangzhou City with overall investment of 500 million baht. The first phase is to introduce the company’s successful retail format to the Chinese market by opening with Central Department Store and Supersports with it’s unique visual merchandising display and store format applied to fit Chinese consumers. It also plans to introduce successful in-house brands such as Defry01, B+Basic and other “only@central” merchandises as well. In addition, Central Retail will be utilizing strong relationships with over 4,000 suppliers in Thailand, with whom we have built solid trust and recognition over several decades. Going to China will create opportunities for our retail partners and suppliers to distribute their products, helping to boost competitive edge and increase efficiency while indirectly helping the Thai economy.

Furthermore, the company will install new merchandising management system, with over 1 billion baht investment budget. This will benefit the company by helping to manage inventory, vendors, deals, pricing and promotion which will result to increase in sale revenue since inventory and customers demand is accurately forecasted. Further more, staff productivity is higher due to more automation and shift towards management by exceptions e.g. invoice matching. The new merchandising management system will be implemented at the end of 2008 starting with Central Food Retail then in phases with other brands over the next 4 years.

Supply Chain Management is also adjusted to cope with 70% increase in petrol price by improving systems and collaboration with customers to reduce cost. For example backhauling process, using plastic box instead of paper boxes increasing durability by 30% and improve time slot of truck usage for better efficiency in traveling both in Bangkok and upcountry so as to maintain truck condition and depreciation is lowered.

Busaba Chirathivat, Central Retail Corporation’s Senior Vice President for Corporate Communications who is responsible for Corporate Social Responsibility activities stated “ We are aware that Central Retail is successful today because of supports from society, therefore, we are giving back by committing to raise awareness, promote rethinking and encourage all parts of the society we come in contact with to join us in the effort. Central Retail’s CSR are concentrated on 5 programs: to better education, historical sites, community, sports & health and the environment. All programs are run at the same time but education and environment are the main focus.” This year 2008, Central Retail Corporation provides funding for 750 scholarships to 87 schools in the north and northeastern region of Thailand deem in most need by the Ministry of Education. For internal CSR, there are education programmes: scholarship for staff children is continued and Central Retail Academy gives employee a chance to earn up to a graduate degree in retail business management. Moreover, Central Retail Corporation in collaboration with affiliated companies has conducted environment preservation campaign called “Love the World, Live the World with Care” to encourage staff and people to reduce the use of plastic bags and use alternative cloth bags. Moreover, Central Retail’s stores will use bio-degradable plastic bags. Electrical equipment are also changed for energy saving purpose. 21 million baht budget is set aside for corporate social responsibility activities this year.

In conclusion, during the first 6 months Central Retail has 7% growth compared to last year, with total sales of 40.6 Billion Baht. Major business investment is set at 12 billion Baht and 21 million Baht for corporate social responsibility programs. Growth for 2008 at year end is expected at an increase of 9 % over last year, totaling 87 billion Baht in sales revenue.

About Central Retail Corporation

Central Retail has successfully operates nine "department store" brands and category-killer specialty stores in Thailand and has received numerous domestic and international awards, including “Best of the Best” from Retail Asia magazine, Euromonitor and KPMG. The company has introduced well–known retail brands among Thais and foreigners : Central, Robinson, Power Buy, B2S, Supersports, Tops, HomeWorks, Office Depot and ZEN

Today, Central Retail has around 400 stores nationwide and plan to open its first overseas department store in Hangzhou, China on September 9th, 2009.
Awards in 2008
  • Thailand’s Most Admired Brand from BrandAge 2008 in category of Top 10 Most Trusted Modern Retail Stores : No 1. Central, No. 5 Robinson and No. 10 Tops.
  • EuroShop Retail Design Award 2008 for ZEN at EuroShop, The Global Retail Trade Fair 2008, Germany. ZEN won the best-designed retail store in Asia.
  • Reader’s Digest Most Trusted Brand in supermarket category in 2008 to Tops
  • Excellent Safety Sanitation and Working Environment Establishment Awards from Ministry of Labour and Social Welfare
Department Store Country Class Provincial Class
Central 10 awards 3 awards
Robinson 2 awards 8 awards
  • Robinson won ASO Gold for Best AIDS Prevention in Work Place from Ministry of Labour and Social Welfare

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