More in business

Business

Tuesday, 21 March 2017 | MYT 12:00 AM

Pos Malaysia revenue to get e-commerce boost

KUALA LUMPUR: Pos Malaysia Bhd is expecting the company’s e-commerce segment to contribute about RM1bil to revenue this year, a significant increase compared with the RM738mil in revenue generated by the segment last year.

Pos Malaysia group chief executive officer Datuk Mohd Shukrie Mohd Salleh said the demand for its e-commerce service continues to increase, in line with the growing overall market size.

“While we anticipate the revenue from our e-commerce segment to increase, its share of total revenue could fall slightly this year from about 43% in 2016. This is primarily due to Pos Malaysia’s acquisition of KL Airport Services Sdn Bhd and Konsortium Logistik Bhd last year which could increase the revenue contributions from other segments.

“Going forward, presumably five to 10 years down the road, 60% to 70% of the future revenue of Pos Malaysia could come from our e-commerce segment,” Shukrie told reporters after the Stratum Focus seminar on e-commerce jointly-organised by Bursa Malaysia Bhd and Hong Leong Investment Bank.

To note, Pos Malaysia’s e-commerce segment contributed about 43% of the company’s total revenue worth RM1.72bil last year. This was a marked increase as the segment generated merely 19% of Pos Malaysia’s gross revenue in 2012.

Shukrie also noted that the demand for Pos Malaysia’s e-fulfilment service remains promising and will increase further in future.

“For Pos Malaysia, our e-fulfilment service grows between 15% and 20% every year, on average. The growth of e-fulfilment outweighs the drop in our traditional mail business,” he said.

E-fulfilment refers to the entire process where the service provider picks up the consignments, packs and delivers to a customer.

The e-fulfilment service includes last-mile delivery, warehousing and value-added services, among others.

On a separate matter, Retail Group Malaysia managing director Tan Hai Hsin projects Malaysia’s retail sector to grow by 3.9% to RM101.61bil this year, in line with the expected moderate economic growth ranging between 4% to 4.5%.

“The performance of the retail sector is anticipated to improve in the second half of 2017, buttressed by the ringgit’s recovery and the possibility of a general election.

“However, the downside risks to the retail sector’s growth rate include the rising cost of living and higher retail prices due to weaker ringgit,” said Tan.

He added that Malaysian consumers would remain cautious on retail spending in 2017.

He noted that despite the cautious consumer sentiment, several sectors such as the food and beverages and services sectors, will be able to register commendable growth moving forward.

In 2016, the retail sector’s turnover registered a weak growth of 1.7% to RM97.8bil, primarily attributed to weak ringgit and the effect of the goods and services tax.

The retail industry employed about 1.2 million staff, with more than 240,000 retail outlets nationwide last year.