The UK’s biggest food retailer, Tesco Plc, have announced plans to open new stores in Malaysia and upgrade a newly acquired chain over the next three to five years. Over 2 billion ringgit (£288 million) will be spent on making the expanding the Tesco Empire in Malaysia, a newspaper said on Friday.
Earlier this week the supermarket giant announced it had bought Malaysia’s Makro Cash &Carry chain of hypermarkets for an undisclosed amount. Tesco currently has 11 hypermarkets to its name as well as three smaller stores in Malaysia .
Tesco Chief, Chris Bush, told the Business Times that the eight stores it bought from Makro will be renamed Tesco Extra, aimed at retail consumers and small businesses .
“Tesco Extra will combine the very best of Makro and the very best of Tesco as we know at the moment, and it’s designed to meet the needs of small businesses, families and individuals all under one roof,” Bush was quoted as saying.
He also stated that Tesco wants to challenge for the position of number one retailer in Malaysia, and its purchase of Makro will help it in its quest. The only main competition comes in the form of retailer, Giant, which currently has over 200 big and small stores and pharmacies .
On the current retail scene in Malaysia, Bush said there was ‘no soft consumer sentiment’.
“We have just gone through a successful festive period. Our business performance is in good shape, we are in a strong position,” he continued.
Around 6.7 per cent of the local market share belongs to Tesco, based on the grocery segment, and with expansion plans in place that it is only a matter of time before their market share increases.
“Malaysia’s economic growth may exceed the official target of 5.8 percent. The government is also confident of meeting its economic growth target of 6.0 percent for 2007,” said the country’s Second Finance Minister Nor Mohamed Yakcop.