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30 Mar 2020

Services

Retail and Restaurant Businesses: Focus on Online Channel Needed amid COVID-19 Outbreak (Current Issue No.3093)

           Retail and restaurant businesses will continue to face challenges ahead as steady increases in the number of COVID-19 infections in Thailand have prompted the government to introduce a number of measures, including a temporary closure of certain venues and declaration of a state of emergency, to curb the spread of the virus. Such measures have inevitably hurt the business sector, in particular retail stores and restaurants because their services are primarily offered at premises.

             However, retail and restaurant entrepreneurs are accelerating adjustments to generate income and sustain their businesses amid the crisis. A quick adjustment that they can do at this time is to focus on an online channel and delivery service in order to offer greater convenience and build confidence about safety to consumers.  We at KResearch are of the view that turnover in the e-commerce and food delivery businesses between March 22 and April 30, 2020 may increase over the normal period by roughly THB8 billion (THB6.8 billion seen in e-commerce and THB1.2 billion in food delivery). However, such a rise may not be able to offset the shortfall in their core income. As a result, net turnover in the retail and restaurant businesses may decline THB72 billion during that period.

                Looking into the remainder of 2020, retail and restaurant entrepreneurs are urged to monitor additional measures that will be introduced ahead, including those aimed at containing the COVID19 pandemic and alleviating adverse economic impacts on businesses and consumers.