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27 Apr 2010

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Retail Business, 2010: Pinning Hope on Politics to Shore up Demand (Current Issue No.2210)

คะแนนเฉลี่ย
Domestic political flare-ups since mid-March 2010 – with mobile anti-government protests across Bangkok, persistent occupation of the Ratchaprasong intersection and the latest bombings – have eroded consumer sentiment significantly, which had earlier shown some improvement since late 2009. Most shoppers have shifted to department stores in suburban areas or other shops closer to their homes and workplaces due to safety concerns. Amid heightened political risk, department stores and other retailers located near the political rally sites have closed temporarily for security reasons. SME operators have been particularly hard hit, given their lower resilience to such a problem than larger businesses. Actually, several marketing campaigns had been actively prepared to cash in on the high shopping season around this time of the year.

KASIKORN RESEARCH CENTER (KResearch) forecasts that if the political conflicts are resolved within 1H10, followed by renewed consumer confidence and intense marketing campaigns to boost sales turnover, retail business may record growth of 3-4 percent (lower than the 6-7 percent projected before the anti-government protesters started in mid-March). Nonetheless, if the political turmoil persists unabated into 2H10, or even escalates, growth would be difficult. That would be especially true if confidence toward Thailand's security in the eyes of the international community and consumer sentiment cannot be restored by the end of this year. In this case, retail business might grow only 1-2 percent. This projection is based on the assumption that the political violence does not spread into provincial areas. Otherwise, retail business may feel a sharper impact inevitably.

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