Retail Reality

A pragmatic Datuk Joyce Yap acknowledges that the business model of shopping malls must change today. "The strong, fittest will survive. To stay relevant, you have to know the critical success factors, you have to evolve. While the hardware is there, the business model needs to be changed," she tells BFM in a candid interview.

E-commerce has certainly disrupted the playing field for malls. Even high end brands like LV, Burberry and Gucci have launched mono brand e-commerce sites in China. Just how big is the impact of online shopping on traditional brick and mortar stores, and is the impact growing? 

"If I tell you it is not growing, I am lying... it is growing (the impact)," Joyce says frankly. She points out that mall operators need to embrace technology and how malls have to be the "right size today but flexible for tomorrow".

Retailers in the US have been hit hard this year. Just this past year alone, a number of big retailers in the West have filed for bankruptcy and these include Toys R Us, Gymboree, Payless and BCBG. Adding to that, Credit Suisse came out with a report that predicts up to 25% of shopping malls in the US will close down in the next 5 years. Will this happen here in Asia? 

Joyce, with over three decades of experience in hand, shares with us her thoughts on this as well as the evolution shopping and whether there is a future for malls here moving forward.