Tang Hua Seng to survive closure with new investors

[misskit]

The Tang Hua Seng Thonburi branch will survive closure, as it has acquired new investors. Details of the investment will be discussed later, said Kittipong Kittipatsorn, the store’s advisor.


The firm is also in discussions with the Metropolitan Electricity Authority (MEA) regarding its overdue electricity bills, he said.


The Thonburi branch has announced its temporary closure, starting today, which means all the shops and tenants in the branch will have to cease operations, and there is no known timeline for resumption of business, if at all.


When the news spread, many people wrote of their memories of visiting the store on social media. Many others visited the store looking for bargains.

The announcement led employees to gather in front of the Thonburi branch, demanding compensation. Some claimed that the firm have not paid their salaries since last year.

Kittipong did not disclose the contingency plans for the employees or tenants, only that the prospective new owner plans to continue operating the location as a department store.


Tang Hua Seng, a family-owned department store business established 62 years ago in Bangkok, is the latest major retailer to close down under the weight of mounting losses and lack of liquidity, due mainly to its failure to adjust to the changing lifestyles of consumers.


The company started out by trading in dress-making accessories in the Bang Lamphu area, subsequently expanding into a department store.


A second branch was opened in the Bang Phlat area in 1991, which was regarded as the most modern store at the time.


As more modern department stores opened, which more closely served the lifestyles and tastes of the consumers, Tang Hua Seng became uncompetitive and out of date.


The company has been running in the red since 2017. Financial performance reports show that, in 2017, the business saw total revenue of 827.86 million baht and a loss of 122.74 million baht.


In 2018, total revenues were 827.34 million baht, generating a loss 28.88 million baht. 2019 saw revenues of 792.10 million baht produce a loss of 93.52 million baht.


In 2020, the revenue of 613.58 million baht meant a loss of 40.30 million baht and, in 2021, revenue of 409.74 million baht left the business with a loss of 43.78 million baht.


The company has reportedly failed to pay all its electricity bills since 2020, forcing the Metropolitan Electricity Authority to cut the supply today, coinciding with the closure of the store.


In 2022 the company sought cooperation from its employees by accepting just 1,300 baht in cash twice a month, with the rest of their salaries paid in coupons, which they could use to buy food and other goods in the store.


Moreover, the company has failed to pay its legally required contributions to the Social Welfare Fund, making it impossible for the employees to claim compensation for layoffs and other benefits.


Several other well-known department stores have closed down in the past 10 or so.


These include Kard Suan Kaew in Chiang Mai, which shut down on July 1, 2022 after over 30 years in operation.


Promedana, a European-style department store built at a cost of about two billion baht, also in Chiang Mai, closed down on May 5, 2022 after only nine years in operation.


Merry King, which had six branches in and around Bangkok, was shut down in 2017 after its opening in 1986. Its main store, located on 0.16 hectares in the Wong Wian Yai area of Thon Buri, is now on the market for about 550 million baht.


Taninrath Pakdeepinyo, a retail business and management expert, said that these shuttered department stores have the potential to be revived with new investment, on the condition that they reflect modern lifestyles and are properly managed.

Tang Hua Seng to survive closure with new investors

[david44]

Online and cheap imports is crushing the low end, the price conscious and or lazt will be on Temu etc