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Technical consumer goods market suffers in Thailand

Posted: 07 Dec 2011 ?? ?Print Version ?Bookmark and Share

Keywords:technical consumer goods market? Thailand flood? industrial production?

The aftermath of the flooding in Thailand proved to be just as disastrous as the flood itself, especially for the technical consumer goods market. According to GfK Thailand's October retail audit figures, a downward trend has been reflected across all product groups. Retail sales have either suffered from the previous month, or in cases where growth were registered, results were not as robust as last year.

As flood waters progressively travelled from the northern region southwards and inundated Central

Thailand by October, increasing number of industrial estates and consumers became severely affected. This took its toll in industrial production and consumer spending habits.

"The flood has definitely affected the technical consumer goods industry in several ways," noted Wichit Purepong, GM of GfK Thailand. "For one, residents facing the crisis would have probably lost any mood to shop, especially when it comes to big ticket items. On top of this, traveling and transportation at places where the situation is more extreme has become a huge challenge and deterrence for consumers."

Sales of bulky products such as washing machines, TVs, desktop PCs and printers plunged in October. However, it was the air conditioner segment that bore the greatest brunt, reporting a substantial 36 percent decrease in volume in September.

Another factor that has also contributed to the lackluster performance of the industry is the bearing of the flood on industrial output since the beginning of October when the flood waters hit uppercentral Thailand. The seven key industrial estates there housing several hundred factories had to be shut down and productions were badly affected.

"Besides a dearth in output due to production suspension, there were also logistical issues faced by manufacturers that prevented their products from being delivered to the dealers' shops, hence resulting in product shortage," emphasized Purepong.

"Moving forward, when the flood is finally over, we can expect to see the industry rebound again with increased consumer spending," Purepong stated. "Besides the sales surge as a result of seasonal festive buying that we anticipate every year-end, we can also be expecting increased consumer spending to replace appliances and gadgets that were spoilt during the disaster. For the manufacturers, that is the light at the end of the tunnel!"

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