A FRESH image is key in maintaining the competitive edge of a successful shopping complex in an increasingly challenging retail climate.

Sunshine Square Bayan Baru, which opened in 1993, undergoes a minor upgrading exercise and a major one every two and eight years, respectively. The shopping complex has 148,534 sq ft of retail space and is 100% occupied.

Cynthia Hwang, executive director of Sunshine Wholesale Mart Sdn Bhd which owns and manage the shopping complex, said in an interview: ''We have a well-managed sinking fund system that enables us to upgrade our image and merchandise regularly.'' Last year, the management injected RM7mil into the renovation of its Sunshine Square – the biggest upgrading exercise the group had ever launched.

The renovation, completed last November, involved expanding the product range and putting in new layout designs that give more visibility to the merchandise displayed in the shopping centre.

The management has recently spent RM8mil into expanding its supermarket inside the shopping complex.

''We'll add 40,000 sq ft to the current 35,000 sq ft supermarket. The 40,000 sq ft space is currently the food court, but it will be incorporated into the supermarket, linked by a travelator. The additional floor area will give us the room to increase the range of our merchandise and broaden the walkways of the supermarket,'' Hwang said.

Carrying out an upgrading exercise and delivering a fresh image help maintain the competitive edge of the shopping complex. But there are other aspects as well.

Cynthia Hwang.

''For example, due to our reputation as a good paymaster, we are able to maintain a network of loyal suppliers. These days, with the presence of a large number of shopping complexes, supermarkets, and hypermarkets in Penang, suppliers tend to be selective as to who they supply to. In addition, we are located in the middle of a densely populated residential community in Bayan Baru,'' she said.

Lee Beng Beng, the manager of Island Plaza, said the shopping mall’s trendy image and reputation for having a good mix of international and local brand names had helped the mall remain competitive. In operation since 1995, Island Plaza, with 150 shop lots and 350,000 sq ft of retail space, is 80% rented out.

''We have recently refurbished the interior of the mall, equipping it with fresh layouts, signs, and additional customer friendly features. We also repainted the exterior of the mall to give it a more appealing look,'' he said.

In addition to maintaining an up-to-date image, one of the strategies that Island Plaza implements to stay competitive in the retail business is the negotiable rental scheme.

''Under such a scheme, rentals are paid according to the percentage of sales achieved on top of a low base rental. This means if they are able to achieve a higher volume of sales, they pay more; if they achieve less, they pay less,'' he said.

Lee said that it was good news that there were new projects planned to accommodate shopping malls and retail lots.

According to Gurney Plaza Sdn Bhd marketing and communications manager Pauline Teh, Gurney Plaza’s solid reputation and image as an exclusive lifestyle mall, offering an array of products and services to different category of shoppers, had enabled it to position itself as a prime site for many retail business.

Lee Beng Beng.

Gurney Plaza, strategically located at Gurney Drive, has about 700,000 sq ft of retail space and some 300 shoplots, and is over 90% occupied. Teh said Gurney Plaza was now renovating its third and fourth floors, scheduled for completion in June.

''Last year, we renovated the first and second floors. The aim of the renovations is to give our interior a new layout, which would benefit our tenants,'' she said, adding that this was the first time Gurney Plaza was renovating since it opened for business in 2001.

Teh said that on top of image and prime location, Gurney Plaza’s rentals were competitive enough to lure tenants with sound retail business plans to take up spaces at our mall.

Meanwhile, Komtar (Kompleks Tun Abdul Razak) Merchants Association chairman Jimmy Chan Heng Sin laments that Komtar lacked a fresh image.

Chan urged the PDC Setia Urus Sdn Bhd and Pen Events Sdn Bhd, the two bodies responsible for maintenance and promotional activities for Komtar, to upgrade the complex's image.

''Although the management has spent about RM35mil on upgrading works for Komtar, the shopping mall still needs a fresh image that appeals to the new generation of shoppers,'' he said.

According to Chan, the growth of new shopping malls was faster than the growth of the population.

''Competition arising from new shopping malls, the decline in tourism, and the slow economy has led to the depreciation of the value of retail properties in Komtar.

''Occupancy rate of Komtar has also dropped to 80% from 85% two to three years ago. Many of these tenants have moved out to strategically located newer shopping malls,'' he said.

He noted that during the first half of the 90s, when the country’s economy was booming, the retail rental in Komtar went up as high as RM30 per sq ft for those on prime locations and RM8 per sq ft for those in non- strategic zones. ''In the second half of the 90s, retail rentals dropped to about RM18 per sq for prime location lots and RM4 per sq ft for non-strategic premises. ''Retail rentals in Komtar are likely to drop slightly again in the future in view of the new shopping mall projects being planned,'' he said.

Source : The Star 21/03/2005