I recently came across a thread by Radzi Tajuddin which I found to be pretty thought provoking, as what he pointed out rings true from my observations. Since his thread is in BM, I’m gonna summarise his points and weave in some of my own thoughts.
- Dollar stores have been popping up all over Malaysia recently. These stores sell household items usually at a storewide fixed price of around RM2.
- Even the hugely successful Mr. DIY Group are jumping in on this, creating their spin-off dollar store chain called Mr. Dollar.
- Previously, these dollar stores are popular around rural areas and small towns, Now, they are everywhere in the urban landscape, even thriving in shopping malls.
What does this mean?
- The M40 group (Middle 40% income class) are becoming the largest patrons to these dollar stores. Dollar stores don’t see B40 group (Bottom 40% income class) as their main target market anymore.
- This shows that the shopping habits of the M40s has changed.
- M40s don’t go for the brand anymore, they go for the value, as long as it works.
- Sure, you may say M40s are getting savvier with their purchases, but it’s also a clear sign that times are tough, and budgets are tighter.
- To go another step further, it looks like the M40 purchasing power is weakening.
- In other words, M40s are disappearing, they are adding on into the B40.
- With upward mobility being so difficult, the wealth gap between T20 (top 20% income level) and MB80 is getting wider.
Radzi’s thread is not to sneer at B40s. His thread also doesn’t scorn at these dollar stores popping up, rather, it shows that the emergence of dollar stores is a sign of the weakness in earning and purchasing power that most Malaysians are suffering from and want the solution to. Do you think his observations are valid?