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ENGLISH

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We have come to the end of 2015. Looking back, we saw how the GST was finally implemented on 1 April. As expected, many consumers reacted by spending cautiously. Later in the year, the economy also faced some challenges. So in this issue, we talk about how retailers can succeed even in uncertain times. No matter the situation, there are always opportunities to consolidate and improve one’s business. Over in ‘Motivasi’, we share with you a few tips on how to stay confident when times are challenging. Next, we travel to Sungai Siput to speak to a retailer who faced his competition head on. What’s interesting in Sungai Siput? Turn to ‘Jalan-jalan Runcit’ to find out. Of course, 2015 was also our 10th anniversary. Yes, we have been bringing tips, stories and news to you for 10 years! On that note, we look forward to bringing you more from Runcit Malaysia and would like to wish you a happy 2016!

MOVING FORWARD TO A GOOD 2016

EDITORIAL TEAM

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THRIVING IN UNCERTAIN TIMES In times of uncertainty, take the opportunity to make positive shifts that will benefit your business later.

2015 has been an interesting year for many businesses. There was the implementation of the GST, a regional economic slowdown, and our Ringgit’s value fell against the US dollar. As a result, the cost of imports may rise and many foresee the retail sector react with price increases. When this happens, we can expect consumers to become cautious with their spending. Nevertheless, our businesses must go on. While 2016 may pave for an uncertain road ahead, there are opportunities you can take to cope with a slower economy and position your business for future success. Here are 7 useful tips:

1. Manage your cash flow Cash is important in times like these. You need cash to keep your business going as you have suppliers, employees and overheads to pay. It is wise to cut your expenses and spend your cash wisely (see tip no 2). You can maximise your suppliers’ payment terms and pay them on time. Conversely, reduce giving credit to your shoppers. Defer your expansion plans provided you can manage cash flow and do not overly depend on business loans. Any expansion plans should be considered carefully against calculated risks.

2. Use your capital wisely Spend your cash in hand wisely. Your biggest capital outlay is most likely stock. Buy from reputable sources that can offer the best terms and the right prices (avoiding counterfeit and contraband products). Hunt for bargains and always be on the look out for special offers by reputable brands.

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3. Observe your consumers’ purchases When consumers are cautious, they will prioritise their spending on essential items such as food, household necessities and personal care products. Review not only the range of SKUs that you carry but also the pack sizes. For example, did you know that in uncertain times, parents tend to buy smaller packs of growing up milk powder rather than larger packs? This is because they don’t want to outlay so much cash.

4. Rationalise your stocks and categories Do not be tempted by long credit terms and overstock unnecessarily. What if the stocks cannot move? Take this opportunity to review your payment terms with suppliers. Negotiate with them for better service levels so that you can buy more often but in smaller quantities and with shorter payment terms. This way, you are more flexible to react when shoppers switch brands or pack sizes. Also, stock items suitable for the general trade rather than items tailored for the modern trade. For example, go for refill packs. You don’t want to end up with slow-moving stocks. You want stocks that have a faster turnover. Also, look for brands who run advertising and promotions for you.

5. Strengthen relationships with existing customers Do your best to keep your customers happy. Add value to your services like offering home delivery, taking orders and informing them when new stocks have arrived. Stay in touch – by phone, SMS announcements, flyers or email. Reach out to them through other means, eg social media such as Facebook (see RMM42, page 10). You want your customers to continue buying from you.

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6. Improve your productivity Get more from your employees and existing assets. Look for ways to do things better and faster. There is always room for improvement. If you have a new system, take this opportunity to learn and use it fully. It may be able to give you reports on fast moving or unprofitable stocks.

7. Put your extra cash in the bank During uncertain times, many small businesses tend to withdraw funds from banks as they need the cash. To counter this, many banks will offer small-to-medium businesses attractive incentives to deposit funds into their banks. If you have the extra cash, take advantage of these incentives and invest in fixed deposits, Amanah Saham or mutual funds that offer good interest rates. Earn short term interest rather than letting your cash stay idle.

Remember, that every uncertain or slow period is only part of an economic cycle. While we may be going through a slowing retail landscape, do not turn a blind eye to opportunities to sustain or thrive. Finally, do not let too much ‘negative talk’ bother you. Stay positive and focussed (see pg 6, Motivasi) and ride through these challenging times with success.

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3 WAYS TO STAY CONFIDENT IN UNCERTAIN TIMES As we go through an uncertain economic period, our friends, peers and customers tend to share with us their challenges. “Sales are slow”, “costs are high” and so on. But let’s face it, we are all human. People just want to vent their problems on a good listener. However, being constantly reminded about uncertain times isn’t helping. It becomes “noise” and hearing too much of it can get you down also. Successful people know how to turn this “noise” into “music”. They know how to stay powerful and confident when times are tough. Here are 3 tips:

1. Stay Rationally Optimistic Sometimes, being miserable is a bad habit. If you feel this way, it’s time you change. When we stay positive, our minds perform better. We become more creative, productive and confident. When our minds are happy, we can plan a rational solution for many problems. 2. Define Your Plans You may have a goal. But during these uncertain times, you need several plans to reach your goal. It may be to cut costs, to spend wisely, or even to look for opportunities. You may feel anxious – what if a plan fails? Hence, having a few plans instead of one can give you the confidence that you’ve mapped out other paths to reach your goal. 3. Do Your Best – Don’t Stress The Rest Do your best when things are under your responsibility but let go of the things you cannot control. Why stress over something that is beyond your control? When you are stressed, you will create that unpleasant “noise” and people around you will also feel stressed.

Finally, think back. Has something ever looked “bad” at the time but turn out good in the end? The answer is “yes” for many of us. So stay positive and confident. Challenging times are just a cycle.

PERUNCIT PRAKTIKAL MOTIVASI

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Is A Card Terminal Right For You?

Credit and debit cards are increasingly being offered in many retail outlets today. Clearly, more and more retailers are beginning to see their advantages. If you have any doubts, consider the following before brushing off the idea:

Convenience for you and your

shoppers

• Credit and debit cards open up the idea of buying more to your shoppers. Your shoppers are not limited to buy with only the amount of cash in their wallet.

• Paying with just a card is something many shoppers prefer. It’s all about convenience.

• With card terminals, you will also have better record keeping of your sales, especially with GST.

Not as expensive as you think

• Search for best package from the banks. Some have a minimal fee for setup or none at all.

• The bank will only deduct between 1%-2% per value of the transaction. Note however, that there is a monthly rental fee for the terminal but this can be negotiated based on your turnover.

Let the bank handle the

processing, you focus on the businesses

• Your cash will be transferred to your bank account a day after you reconcile your transactions. This can reduce your trips to the bank.

• Studies found that the cost of handling cash is 3% of your sales. With less cash handling, you don’t have to worry about these costs such as robbery or pilferage.

Ultimately, most major retail stores already have card terminals. It saves them closing time and cash handling worries. To keep up with the competition, you should think about providing this facility to your shoppers today.

PERUNCIT PRAKTIKAL OPERASI

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FACING THE COMPETITION

Why did you decide to open Pasaraya Jimat Sg Siput so close to a hypermarket? Initially I was running Kedai Chop Swee Hin Chan, which I inherited from my father over 30 years ago. I expanded that shop and when business grew, I then opened Pasaraya Jimat Sg Siput. I picked that location despite being opposite to a competitor because I believe it is a good area and I was offered a good price. I’m not concern as customers from my first shop also go to Pasaraya Jimat Sg Siput to shop.

Mr Yap Mow Chai runs Pasaraya Jimat Sg Siput, a kedai runcit that opened over two years ago in the quiet and charming town of Sungai Siput, Perak. Interestingly, a big hypermarket is located opposite his shop and has been operating long before Mr Yap opened his shop there. We asked Mr Yap why he decided to open his shop so close to a competitor and how he managed to succeed.

This shop is big, occupying 4 shop lots. How do you manage this and your other shop? I look after Chop Swee Hin Chan with my wife while my brother takes care of Pasaraya Jimat Sg Siput. Initially it was difficult to manage because I couldn’t find good workers. Eventually, we found a few and trained them well which made business easier. It is also important to modernise by having a POS system for payment and stock keeping which makes business operation more efficient.

How did you face the competition? I surveyed the other shops to compare prices and see what they sell. Pricing is a very important factor, that’s why we sell at very low prices and have attractive promotions all the time. Our customers always compare prices before buying. We also provide a range

of items and popular brands so our customers can get everything they need here. Besides that, we also do wholesale for nearby businesses like restaurants.

WIRA RUNCIT

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As you might have guessed, the town of Sungai Siput got its name long ago when a huge number of snails were found in a nearby river. If you happen to visit this town, don’t miss the following attractions:

Lion’s Hill According to locals, this hill resembled a lion’s head long ago, hence its name. Today, it is a popular spot among hikers who are up for a challenging trek. The lush greenery around the hill is sure to calm any visitor.

Menglembu ‘Fisherman’ Groundnuts This groundnut brand is produced by one of the oldest factories in Sungai Siput. If you’re keen on groundnuts as souvenirs, be sure to drop by the Mee Hiong Yuen groundnut factory near the Jamek mosque.

Mahatma Ghandi Kalasalai Tamil School With over 1,000 students, this Tamil school is one of the largest in Perak. Interestingly, this school was built on donations contributed by teachers, plantation workers and residents of Sungai Siput, all of whom donated about a day’s wages for the school.

Did you know? Menglembu groundnuts were believed have been brought into Malaysia by early traders from China. The first crops were planted in the town of Menglembu, Perak. So, these famous groundnuts have got nothing to do with cows (lembu)!

Lion’s Hill

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DIFFERENT TYPES OF KUIH-MUIH To fulfill the request of customers, I started to sell kuih-muih a few years ago. At first, I only sold a few types of kuih-muih but with the increasing demand from my customers, I now sell a variety of kuih-muih which meets the expectations of my regular and even new customers. Mohd Bakhori Hassan MBH Jaya Enterprise Machang, Kelantan FS: Zulkifli

BILL PAYMENT SERVICES In a retail business that is getting more challenging, I began to offer additional services like handphone ‘top-ups’, bill payments, ‘touch n go’ reloads and Astro bill payment. Besides that, my retail merchandise can also profit from these new services. Zainul Abidin Pasar Mini N & Z Bangi, Selangor FS: Sim Keng Lee

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CAKAP-CAKAP RUNCIT

SPECIAL LAKSA SARAWAK I introduced a new product which is Laksa Sarawak paste to attract customers. It then became my shop’s specialty and a shopping place for customers from Sarawak. It has also attracted food stall operators and with that, I get to promote the tastiness of Laksa Sarawak. Grace Pijah Gracefidel Multistore Cheras, Selangor FS: David Teh

24 HOURS CONVINIENCE For my customers’ convenience, I open my shop 24 hours a day. My shop is also air-conditioned and I have low gondola shelves for children’s accessibility as there are many schools nearby. This will provide comfort to the customers who visit my shop. Kumar Hajris Retail Sdn Bhd Cheras, Kuala Lumpur FS: Sim Keng Lee

ATM SERVICE I installed an ATM at my shop which is located in a tourist area for the convenience of tourists and also the locals. With this machine, my revenue increased in a short time. I also installed a complete CCTV system to ensure the safety of my customers. Lim Teng Hoo Chulia Twenty Four Seven Mart Georgetown, Pulau Pinang FS: Kek Soo Guan