Cambodian 24 hour retail chain Kiwi Mart has sold its 18 stores to the Thai-owned and regional powerhouse chain brand Big C as Cambodia’s retail sector prepares for increased competition from big brand players.
Speaking to Cambodia Investment Review, Kiwi Mart owner Pascal Catry said he was advised by Anthony Galliano from Cambodia Investment Management however could not disclose the purchase price due to contractual arrangements.
Cambodia Investment Review has previously reported that the expansion of Big C – operated and managed under Berli Jucker Public Company Limited or the BJC Group (BKK: BJC) – is earmarked to open 350 stores and employ over 1,200 staff by 2026. To read more about the Big C expansion plans in Cambodia click here.
Established in 2017, with a moto of “anything, anytime, anywhere” Kiwi Mart was initially focused on fast moving consumer goods and packaged foods then shifting during the pandemic to new concept of Kiwi Mart Premium selling imported fresh food.
Cambodia’s retail sector ready for big players
Kiwi Mart owner Pascal Catry, who also owns the brand UCare Pharmacy, commented on the timing of the sale that he knew at some stage the market would attract the big players and would create the opportunity to divest adding over the past years he had been in contact with some of them but, it did not go very far.
“This time it was more serious as the discussion was not only involving the transfer of the business but also future collaboration in the field of procurement as well as in other business areas where we have common interests,” Catry sad.
“It is always better to be partners with powerful groups like Big C rather than competitors and competition wouldn’t have been only on sharing customers, but also on getting staff and locations,” he added.
Reflecting on the current state of the sector Catry said in the short term Cambodia’s retail sector must recover from the recent and painful crisis and that takes time and creates opportunities such as lower rents and closed stores while for the big players to enter a more mature market where consumption behavior has evolved.
“The business for small chains of convenience stores will become more competitive and only single convenience stores may survive the competition with the big guys such as DFI, Aeon, Seven eleven, Big C, and Chip Mong. Also during the pandemic, consumers have realized that proximity stores may come even to their doorstep thanks to technology (e-commerce, online payment platforms, and deliveries),” he said.
“In the long run, e-commerce will eat a bigger share of the retail market and the big players need to take a strong position now if they want to become or remain a leader in their field when the market will consolidate,” he added.
Big C attracted by Cambodia’s growing income
Speaking to Cambodia Investment Review previously Gary Hardy, Chief Operations Officer of Big C explained the company decided to expand further into the Cambodian market as the country continues along its strong growth trajectory.
He cited rising incomes, connection to the Big C brand, strategic supply chain locations and overall similar consumer demand to Thailand were major factors for the expansion.
“The Big C brand already has a strong presence in neighboring countries such as Thailand and Laos – so strategically Cambodia was the obvious next market destination for us. In addition, Cambodia is a rapidly growing economy and we want to establish our brand here as it continues to grow,” Hardy said.
According to the National Bank of Cambodia, the country’s Gross Domestic Product per capita has been upgraded to $1,842 in 2022, a 6.4% increase from 1,730 in 2021. While inflation is expected to rise to 4% year-on-year in 2022, as demand post COVID increases and supply chains are squeezed due to logistics pressures and geopolitical crises.