Udon Thani —
On August 1st, 2024, Mr. Milin Wirarattanaroj, the CEO of Tang Ngee Sun Superstore in Udon Thani, reported a significant decline in consumer spending during the first half of 2024. Sales of consumer goods and alcoholic beverages have decreased by 20-30%, he said.
This downturn is attributed to a lack of new factors to stimulate consumer confidence and spending, said Milin. Retailers and wholesalers have responded by reducing inventory levels from the usual 4-6 months in advance to just 1-2 months to better manage cash flow. Suppliers are also shortening credit terms, said Milin.
Milin expressed hope that the government’s upcoming 10,000-baht digital wallet scheme, set to launch at the end of 2024, will boost market spending. However, he voiced concerns over the implementation details and accessibility of the system, particularly the eligibility criteria for participating stores, which are currently divided into three tiers.
Milin also highlighted potential issues with Tier 1 cash flow, as these smaller retailers might struggle with the three-month wait for cash disbursement. Conversely, larger Tier 2 stores receive payments within three days.
Recently, the inclusion of “Thong Fah or Blue Flag” stores, which cover both small and large retailers, was proposed following requests from retail associations to simplify the tier structure to just Tier 0 (people in general) and Tier 1.
Finally, Milin mentioned an upcoming meeting with suppliers to clarify the new system and build confidence in the three-month cash cycle required for the digital wallet scheme.
Related:
Read our latest article about restaurant businesses facing over 50% drop in spending.
This article originally appeared on our sister website The Pattaya News.
