Attracting more business with good-looking stores

In Malaysia, 7-Eleven rolls out a new look and small neighbourhood retail stores have been given a facelift under a government-assisted modernisation programme. Prakash Sakti reports.

Retailers use many strategies to attract customers and to generate sales. Advertisements, discounts and promotions, product variety and year-end sales events are some of the common strategies. In addition to these, an attractive store design can certainly help to bring customers into the store, often the first step to making a sale.

Nowadays, modern retail outlets in the big shopping malls are not the only ones paying attention to store design and investing in shop fitting works. Traditional sundry shop operators are taking care of their shop appearances to increase their appeal to consumers.

These small retail shop operators are learning that there are tangible benefits to good store design and shop fitting. A well-designed store allows goods to be neatly stacked up and easily located by customers and this will aid sales.

While established retailers have bigger budgets for store renovation and installation of modern fittings, small traditional retailers are often hampered by a lack of funds.

Thus, the Retailer Transformation Programme (Tukar) was started by the Malaysian Government in 2011to give these smaller retailers the opportunity of a store facelift and a new lease of life.

Under the programme, participating outlets can apply for a RM80,000 loan (US$24,871), of which half the amount is to be used for renovating the store and the rest to be used as working capital.

Domestic Trade, Cooperatives and Consumerism Deputy Minister, Datuk Seri Ahmad Bashah Md Hanipah, says the Tukar programme has been well-received. To-date, some 1,600 retail shops in the country have been modernised under Tukar.

“Sundry shop operators on the outskirts [of major towns], for example, are very happy as their sales volume has surged since modernising their shops through Tukar. It gives the existing premises of traditional retailers a facelift,” he says.

Transformation of sundry shops 

Despite the mushrooming of hypermarkets and supermarkets all over the country, small mom-and-pop shops or traditional neighbourhood retail outlets are still indispensable to Malaysians.

For a long time, these shops have a distinct role in providing daily convenience for those living in the vicinity, but stiff competition from the big players are forcing them to change in order to survive alongside the competition.

These shops need new designs, fittings and equipment to cater to customers who demand more than just good and cheap products. Funds has always been the limiting factor, but now the Government has stepped in to help modernise the stores and give a new lease of life to these mom-and-pop shops under its Economic Transformation Programme for the retail sector.

One successful applicant for assistance under the programme is G. Mahendran, who has been running his family sundry business in Brickfields for the past two decades.

“The [shop] facelift is like a promotion in itself. My customers like the changes made to the store. The shop looks brighter, neater and more systematic. The change is good for me as well as for my customers,” he says.

According to Mahendran, in the past the shop had only a cement floor, but this has been replaced with mosaic tiles, new and safe electrical wiring, shiny new racks, new appliances and goods rearranged to be more attractive.

The store transformation also involves the installation of equipment such as the POS Counter Terminal, an inventory database, gondola arrangement, new lighting, advertising board with the TUKAR logo. The store is even equipped with Internet access.

Furthermore, retailers taking part in the programme are also given various options in modernising their outlets, such as installing chillers, freezers, storage boxes, security alarm, air conditioning and tiled floors.

Some shops have also installed glass doors and partitioned aisles.

Through the TUKAR programme, once run-down shops are now modernised and transformed into brightly-lit mini markets.

The Malaysian government has also appointed several hypermarkets to act as consultants to the small shop retailers. The small shop owners are taught how to manage stock better, redesign their store layout and improve merchandise display to increase sales.

To implement the programme, the Malaysian Finance Ministry has allocated RM149 million for a three-year period from 2011 to end-2013.

7-Eleven stores spot new look 

Meanwhile, 7-Eleven stores in Malaysia are also undergoing a major change.

Product variety is not the only selling point of 7-Eleven, as far as its management is concerned.

The No. 1 standalone convenience store chain in the country launched its 1600th store in Solaris Dutamas in Sri Hartamas on June 18. The new store sports an entirely refreshed look and format.

Gary Brown, deputy CEO of 7-Eleven Malaysia Sdn Bhd, says the landmark store showcases the new 7-Eleven convenience store format, which is being rolled out across Malaysia via a programme of store refurbishments and new stores.

“We are pleased to be able to showcase here the new format of our stores which presents a different look and feel to other convenience stores in Malaysia with a strong emphasis on innovative fresh food and beverage,” he says.

The new concept for 7-Eleven convenience stores is to encourage customers to see 7-Eleven as a lifestyle store, where they can enjoy an innovative range of products by spending time at the store, similar to being at a neighbourhood café.

In addition, as a result of new partnerships with companies such as Incomm, Money Online and Touch ‘n Go Sdn Bhd (“Touch ‘n Go”), 7-Eleven Malaysia will be expanding its range of services to customers by providing Touch ‘n Go reload services nationwide, as well as rolling out point-of-sales activated (“POSA”) gift cards in partnership with Incomm.

Brown says it is important to continue to develop and increase not only the product offering, but to create opportunities for7-Eleven to play a greater role in the daily lives of customers. He says that by adding on these services, 7-Eleven offers a whole new level of convenience to customers in Malaysia.

The store design has been revamped to tie in with the new store concept. Refurbished 7-Eleven stores feature seating areas where customers can enjoy free Wi-Fi service and a wide range of fresh food and beverage. “We really think that our new stores will be a place for people to congregate and enjoy their time,”says Brown.

He adds that 7-Eleven is excited about what the future holds with the new store concept and it will continue to deliver the best possible product offering at the new-look 7-Eleven stores.

7-Eleven, which serves more than 900,000 customers daily, plans to increase its number of new stores by 600 over the next three years from 2014 to 2016. The company has set aside RM80-million for 200 new stores and 200 refurbishments this year.