Closures loom for many businesses in Malaysia falling on hard times

Hawkers and Petty Traders Association chairman Ang Say Tee said many shops would be closing down in the coming months as they could no longer cope with rising operational costs and diminishing profits.
“There are about 500 shops on this street, and I have learned that many are prepared to close if business does not improve soon.
“All types of businesses are affected ranging from food and clothing to computer services and stationery.
“Business has not been good in the last two years and has turned for the worse now for many of the proprietors here.
“Many have been holding on, hoping for better times, but it is only getting worse, so they have decided to call it a day before they lose more money,” he said.
He added that some did not want to disclose that they were closing down as they were afraid of being harassed over unsettled loans.
A trader who refused to be named said operational costs were too high to sustain in the present slow economy.
“Manufacturers set a minimum limit for orders. Small retailers are forced to purchase in big numbers to get a lower rate, but then we struggle to sell these items over a long period of time. As manufacturers do not entertain small orders, we are forced to resort to buying from other retailers at a higher price, which will reduce our profit margin. Traders are caught in this tight situation.
“Other challenges include increasing costs of raw materials and higher salaries demanded by the workers. All these add up to the increased price of the item for sale, and the consumers are not happy,” he said.
Another business owner, who also declined to be named, said the poor business was also partly due to the relocation of the buses from Pudu Sentral to Terminal Bersepadu Selatan, which had a huge impact on the number of visitors to the area.
“Some in transit or have time to spare upon arriving at Pudu Sentral or before their bus leaves, will do some shopping at the nearest attraction ‘Petaling Street’. With fewer long-haul buses here, the movement of people in the area also reduced,” he said.
Traders along the neighbouring Jalan Sultan (Sultan Street) are also feeling the pinch.
Steven Ng, whose computer-services shop has been open for 10 years, said he had been thinking of relocating.
“Business has not been good. There was a time when I was making 2,000 ringgit a day and it went down to 1,000 ringgit. Now it is only about 500 ringgit [Bt4,300]. The shop rent is between 10,000 and 15,000 ringgit, and with the additional goods and services tax [GST], operations have become very expensive.
“With reduced revenue, a lot of traders here are finding it tough to cope with the high rent. The electricity bill has increased too.
“I am now in negotiation with a neighbouring business to see if it is feasible for us to share space to reduce our overheads and continue our businesses in Jalan Sultan,” he said.
Another trader, who only wanted to be known as Low, said he had been thinking for the past couple of months about closing down,
“Numerous other shops have already shut down. I have also thought about moving out, but I am bound by my tenancy agreement. I will have to access the situation when the time comes. I have been doing business for over three years now and the biggest burden is the rental and GST.
“There are fewer customers and they are less willing to spend money,” he added.
Tan Paen Sim, secretary-general of the Malaysian Garment Wholesale Association, acknowledged that many in the clothing industry were closing down because of online shopping.
“Online shopping poses the biggest challenge to traditional clothing stores. If one cannot sustain, it is better to close shop now than incur debts. Some still hope to come back to the business when the economy improves.”
“Some of them who have temporarily halted their businesses are either taking time off or seeking other jobs to supplement their income,” he said.
A famous art-supplies shop in Petaling Street, which has been around since 1969, Venus Art and Stationery, is pulling down its shutters for good at the end of May. The store is currently clearing its stock by giving big discounts.
Owner Yap Chin Fatt, 84, said the decision to close shop was made at the end of last year.
“The shop is open from Monday to Saturday from 9am until 5pm, and I am here every day overseeing the operations. If business was good, I would have continued. But it is not. It has become a struggle to sustain this business.
“But I have no debts and I am not afraid to inform the public.
“We are very grateful for all the support that we have received over all these years from the art fraternity that has kept us going,” he said.
The family is also in the business of manufacturing art supplies under the brand names Fairbro and Fairbreno, so they will focus on that for now.
Yap said that ever since the computer age in the new millennium, his retail business had seen a slowing trend.
“It has come to a point that many do not emphasise or appreciate manual work any more.
“In our early years, schools and universities gave us a lot of business. Students were required to do illustrations and other artwork by hand back then, but now everything is done with the click of a mouse. As such, various items have become obsolete.
“For example, the demand for technical pens, widely used for architectural, engineering and technical drawings, which were priced at between 200 and 400 ringgit a set, has dropped overnight because of the computer age and sudden shift to digital drawing.
“I still have these sets, which I bought in bulk four years ago. Few people want to buy it even if I give them a 50-per-cent discount. Even the manufacturers have stopped producing them.“What am I going to do with these pens?” he said.
“We are mulling the idea of going online to sell our products.
“When I started this business, my friends were sceptical of its success. Art stationeries were said to be a very difficult thing to sell. But I saw the potential in it as it was very versatile.
“I travelled a lot and sourced the latest art supplies from all over the world, which gave my shop an edge over the others. My business flourished.
“But with the advance of computer technology, which came on fierce and strong, we have foreseen this outcome,” he conceded.
So after nearly five decades of hard work, the father of three and avid traveller said he was ready to retire.
“It is a little sad and emotional, but it is time to move on. It is time to stretch my wings,” he said.