The retail rush

Expect SM Retail to be more aggressive in putting up multiple format stand-alone food retail outlets—whether it’s SM Supermarket, Hypermarket, SaveMore or Waltermart—especially as its retailing “frenemy” has gained headway in the supermarket numbers game.

SM Retail ended last year with 241 stores, still the biggest in the country, but excluding 48 SM Department Stores (classified under the nonfood retail segment), it had 193 food stores consisting of 39 SM Supermarkets, 39 SM Hypermarkets, 93 SaveMore stores, and 22 WalterMart supermarkets.

On the other hand, Lucio Co-led Puregold Price Club reported a consolidated store count of 213 Puregold and S&R stores in operation at the end of last year.

This year, SM Retail will spend up to P6 billion for expansion (out of SM Investments’ total P80 billion in capital expenditure budget) and expect food retail to account for a big part of it.

“For the food retail, this is the area where we need to be very aggressive and do multiple formats so that we can penetrate and enter different types of market,” said Cora Guidote, head of SMIC’s investor relations. The investment in Double Dragon Properties’ community mall expansion is also part of this agenda to bring its food retailing formats—especially the mid-range SaveMore—to the provinces. In any case, she says it’s easier to do landbanking for the smaller stand-alone formats.

SMIC’s investor relations officer Tim Daniels adds that SM Retail’s strategy is not really to compete based on pricing (note that rival’s mantra is “everyday low price”) but in having the broadest range of products to cater to more people. Doris C. Dumlao

Fireworks and condos

There must be something about fireworks over Manila Bay that inspires people to buy seaside condominium units.

Apart from bringing extraordinary foot traffic to the SM Mall of Asia complex, the five-week international pyromusical competition held at the complex is—as far as the group of tycoon Henry Sy is concerned—a big success because this gave good mileage for SM Development Corp.’s marketing of Shore Residences.

During the five weekends of the Pyromusical shows, the group sold P1.1 billion worth of residential condominium units, said Jeffrey Lim, chief finance officer of SMDC’s parent firm SM Prime Holdings Inc. “This is where you will see synergy of the property area, where the mall and residential went into partnership in sponsoring pyromusical,” Lim said.
Lim said the outlook for SMDC’s sales take-up this year was “very good” and that the company might bring to the property market 11,000 to 12,000 units in new inventory from both new residential projects and expansion of existing ones. He said there was no slowing down from the usual range of 10,000 to 12,000 units that SMDC unveiled in a given year.

On foot traffic, about 3.5 million people visit SM’s nationwide mall network on a typical day, or during weekdays. On weekends and especially when there are special events like the pyromusical competition, foot traffic hits as much as 4.5 million—more than the daytime population of Makati. Doris C. Dumlao