Tesco Lotus denies plan for 3,500 Lotus Express shops
Tesco Lotus denied claims that have appeared in the media regarding the "aggressive expansion" of its mini-format Lotus Express outlets to avoid limitations that might occur with the implementation of the new Retail Business Act, which will reach the Cabinet for consideration in the next couple of weeks.
"We've been receiving information since last week that there has been an attempt to spread this false information," Darmp Sukontasap, senior vice president of Ek-Chai Distribution System, operator of Tesco Lotus, said in a company statement."As some of you may know, there are now about 6,300 convenience stores in Thailand. Of that number, 4,000 belong to the market leader in convenience stores. Tesco Lotus has 260 express stores, or a mere 4 per cent. Based on such a number, if we want to achieve the target of 3,500 stores in 2008 as claimed in the false information, we would have to open at least five stores every day, non-stop, from now to the end of 2008. This is something quite unrealistic." Darmp said that at its current rate of expansion, it would take the company 53 years to achieve the target of 3,500 express stores. He said the fact was that Tesco Lotus planned to open only 60 new express stores this year. At the same time, at least two other convenience-store operators have come out to announce they would open 500 new stores each. If this is the case, then by the end of this year, there will be 7,360 convenience stores in the Kingdom. Of that number, 320 will be Tesco Lotus express stores - still 4 per cent of the overall market. This is hardly an expansion that is in line with the market size, Darmp said. Moreover, the business format of the express stores will remain unchanged. The Lotus Express stores will be about 300 square metres of retail area, and the company does not have any plans to reduce the size of its new stores as claimed in the false information. "Therefore, we would like the media to examine the false information that they have received," Darmp said. "This is because nowadays, the group of people who disperse false information about Tesco Lotus seems to be operating as a syndicate. We would like to request that the media learn more about the people who choose to give out such false information: who they are, their background and their motives," Darmp said. He said that as for the draft Retail Business Act, the company's position remained the same. "We have no objection if the government deems it appropriate to have a law governing retail and wholesale businesses. We also support the idea that everyone in retail and wholesale should co-exist, speaking to each other with reason and working together to provide consumers with quality products at reasonable prices," said Darmp, adding that the law, however, should be fair to everyone and treat all concerned equally. It should clearly spell out the role and responsibility of each of the players, be they suppliers, wholesalers or modern-trade retailers. More importantly, the law should include specific measures to help enhance the competitiveness of mom-and-pop shops.
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