Published by Focus Malaysia & Astro Awani, image from Focus Malaysia.
WHILE many businesses are struggling to sustain their operations since the imposition of the movement control order (MCO), data from the Companies Commission of Malaysia (SSM) showed 281,781 new businesses registered between March and October this year.
The hotel and tourism industries are undeniably the hardest-hit industries in Malaysia. Hence, hotel operators have shifted focus to food & beverage (F&B) – from cooking demonstrations to food delivery.
Besides that, several hotel chains across Malaysia have introduced “Work from Hotel” packages from as low as RM19 per day, allowing a refreshing change for those who are tired of working from home.
Click, click buy
As people began to spend more on essential goods like groceries and household supplies, Shopee, which is Malaysia’s most popular e-commerce app, introduced a comprehensive and aggressive promotional strategy such as RM1 deals on groceries, fashion and kitchen appliances to expand their online customer base.
Comparatively, Lazada took a relatively different approach by launching a business stimulus package – Pakej Kedai Pintar – to support e-commerce entrepreneurs and small and medium enterprises (SMEs) in e-commerce adoption.
Lazada also assisted farmers based in Cameron Highlands sell their produce as well as launch an e-bazaar platform which generates income among hawkers.
Besides that, local data firm INVOKE Solutions launched the Meniaga app on Oct 15, the only cash-on-delivery (COD) platform that is completely free-of-charge. This encourages buyers and sellers to transact within a 10km radius and start a microbusiness from home.
Flying high
Meanwhile, AirAsia expanded their services ranging from airline and accommodation services to digital payment services which offer a prepaid Mastercard delivery services which include duty-free products and fresh groceries.
With the launch of the Asean super app on Oct 8, AirAsia introduced Super Sale with storewide discounts of up to 90% across all product offerings from Oct 12 to 18 to boost online sales.
Hypermarkets
Some hypermarkets experienced a big jump in their online traffic during the first week of MCO, notably Jaya Grocer (600% increase) and Tesco (450% increase) as compared to the first two weeks of March before the MCO. With the extension of the conditional MCO, more households are expected to purchase fresh groceries online.
Food at your doorstep
Malaysia’s online food delivery service saw an increase of more than 30% since the imposition of the MCO. According to Statista Market Forecast (2020), revenue from food delivery services in Malaysia will amount to RM896 mil this year – about 46% increase compared to last year’s revenue.
The success of food delivery portals such as GrabFood and FoodPanda has forced existing restaurants owners with brick-and-mortar eateries in Malaysia to develop new products such as DIY home kits.
Ghost & Cloud Kitchens
Ghost and cloud kitchens are also gaining traction in Malaysia. While ghost kitchens are facilities made solely for producing virtual brands, cloud kitchens are centralised licensed commercial food production facilities whereby spaces are rented to prepare delivery-optimised menu items.
Cloud kitchen menu items are optimised for ease of production and reliability of food quality upon delivery. These kitchens provide shared cooking facilities with minimal start-up cost, which is at least 50% lower than opening a brick-and-mortar restaurant.
How will Budget 2021 help?
The latest budget provides the chance for the hotel, tourism, retail, as well as F&B industries in Malaysia to ride out the economic storm by utilising the following schemes:
- Extension of the Wage Subsidy Programme for another three months with a more targeted approach, specifically for the tourism sector which includes the retail sector at a rate of RM600 per month for workers earning RM4,000 and below.
- Provide training and placements for 8,000 employees of airline companies in Malaysia.
- Provide a six-month exemption from the human resources development fund (HRDF) levies effective Jan 1 next year which covers the tourism sector and companies affected by the pandemic.
Moving forward, industrial players could also utilise the Malaysia Digital Economy Corporation (MDEC)-related initiatives such as Go-e-Commerce initiative, Digital Transformation Programme (DTAP) and SME Business Digitalisation Grant – thus extending their reach into lucrative markets, enhancing online marketing capabilities and strengthening their supply chain.
It is time for the industrial players to move forward by constantly thinking out of the box – reviewing their business model and supply chain network, while building more resilient and agile businesses to survive and recover from the COVID-19 pandemic – Dec 7, 2020.
Amanda Yeo is a research analyst at EMIR Research, an independent think tank focused on strategic policy recommendations based on rigorous research.
