Big C doubles investment in new stores

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After slowing its investment last year, Big C Supercenter Plc has announced plans to almost double its investment to 2 billion baht for outlet expansion this year.

A smaller Big C store format will also be launched this year to speed up the expansion.

Rumpa Kumhomreun, the company's chief financial officer and vice-president for accounting and finance, said Big C was ready to make big investments again as sentiment has improved over the global economy.

Last year, the company spent 1.1 billion baht to open one new outlet.

The company also expects the purchasing power of low-income people to improve this year with a better export and tourism outlook and higher prices for agricultural products.

"We will expand our business regularly this year. We have seen signs of economic recovery since the fourth quarter last year, when our performance was positive as well," she said.

From 2010 to 2012, the company plans to open three or four new hypermarkets per year, plus some smaller store formats.

"Out of 76 provinces in Thailand, Big C has an opportunity to expand into at least 38 provinces. There is potential for hypermarkets here and the market share of the modern trade is still under 50%, compared to 70% to 80% in some developed countries," said Ms Rumpa.

Various retail formats can be used to suit local communities and specific market situations.

Jariya Chirathivat, the company's vice-president, said Big C will open four or five stores this year. About three or four stores will be under the standard format and the rest will be under a new format with 2,000 square metres of space - the smallest size the company has ever used.

The 2,000-sq-m format will be introduced in some central provinces. This smallest size will allow the company to speed up its expansion into small cities and districts.

Currently, Big C operates 67 retail stores with three formats - standard (from 8,000 sq m and up), compact store (6,000 sq m) and mini-compact (4,000 sq m).

It also operates 11 Mini Big C outlets and 19 Pure drug stores.

Sales of Big C last year were 68.05 billion baht, up 1.1% from the year before. Net profit also increased marginally, to 2.86 billion baht from 2.85 billion the year before.

The economic downturn and unfavourable market conditions resulted in sales in some quarters falling for the first time since the 1997 crisis. But Big C can now grow again, said Ms Rumpa.

This year the company expects its sales to rise by 4% to 5% .

Shares of Big C closed yesterday on the Stock Exchange of Thailand at 44.0 baht, up 1.50 baht, in trade worth 61.2 million baht.