CEO of Mobile World: In April, we had to close 600 stores, but now we reopened almost all the systems

On April 23, 2020, the Prime Minister decided to relax the social gap across the country, except for some high-risk areas in Hanoi (such as Me Linh, Thuong Tin), Ha Giang and Bac Ninh. In other localities, the Prime Minister directed strict control and strict monitoring but facilitated the normal production and business of people.

Reported by the reporter showed that the restaurants, shopping centers in Hanoi and Ho Chi Minh City on the first day of easing the social gap have started to open again. For non-essential items such as electronics and refrigeration, we contacted Mr. Doan Van Hieu Em, General Director of Mobile World Joint Stock Company, which operates two retail chains of Mobile World and Dien May Green, on the restart of business operations.

After the Government agreed to relax the social gap, how to reopen Mobile World and Dien may Xanh stores?

Mr. Doan Van Hieu Em: At this moment, it can be said that the Mobile World and Dien may Xanh system have reopened almost the whole system (nearly 1,000 stores across the country), leaving only 18 shops in two districts belonging to the group. High risks in Hanoi are Thuong Tin and Me Linh.

In April 2020, Mobile World had to close about 600 stores to meet the requirements of disease control and social isolation. At present, although we have opened most of the stores, we still set limits to suit the requirements of state agencies such as limiting the number of customers to shop, the number of employees .. to limiting disease-related risks.

The number of stores belonging to Mobile World Investment JSC (MWG) by the end of February 2020, by the end of April, the number of Bach Hoa Xanh stores was nearly 1,300.

How does the closure of 600 stores (about 60%) affect the business results of Mobile World sir?

In fact, the disease has affected the entire economy since February, particularly April was the hardest hit month. However, Q1 / 2020 business results of MWG still achieved positive growth compared to the same period last year. This means that in February and March, despite the impact of the disease, we still had positive results. By April, the closing of stores would certainly affect sales, according to the data I got about 30% lower than the same period last year.

The reopening is expected to be high, but how difficult it is to predict. If the disease situation stabilizes and life returns to normal, the resilience will be great. But it is not known, because the business situation depends on many factors, how diseases affect the economy and people’s income, affect people’s purchasing power or not …

The demand for mobile phones and electronics has decreased, but not to the extent of our initial worries. We also worry that mobile phones and electronics are not essential goods like those of Bach Hoa Xanh’s products, they will probably be affected but they are not, this is reflected from the results of February and May. 3. The April decline is mainly due to the closure of the stores, when the stores are reopened and will not be affected too much.

 

Which items are consumed the most in the disease?

I think this is the advantage of Mobile World over chains specializing in only one product, that is, we deal in many industries. There are some groups due to the impact of the downward trend such as phones and televisions but there are some groups that increase like refrigerators. The large demand for food makes the refrigerator industry increase although this is not the season for refrigerator consumption. For laptops, too, April 3-4 is not the time to buy a laptop, but due to the need to study and work online, this item has increased sharply.

With the Bach Hoa Xanh chain, there are currently nearly 1,300 stores and epidemics, causing the demand for essential purchases to increase significantly. As a result, we have complementary products that make Q1 sales grow.

How to negotiate with leasing partners to reduce costs?

We have received very good support from the rental partners. Although we are still in good business, they are finding it difficult at the moment so they are willing to support the price reduction at this time.

Does the mobile world have support from distributors like Samsung, LG …?

We are a big partner of distributors and they always accompany and support to reduce the cost of debt, promote the promotion of better promotions after the translation.

After easing social isolation, did you launch a program to stimulate customers?

This disease that no one wants, is force majeure, asking if it affects the system is definitely possible, but I see more opportunities.

This is a time for us to look back on the entire business, find out the points to better control costs. Like IT systems on the system to reduce labor costs, the same revenue but reduce headcount at the shop more.

Through this phase, we can also adjust the rent price, refine the space that is not good, not as good as other shops.

I myself see many opportunities after this epidemic, if we prepare good sources of goods, sales promotions, then when we come back we will achieve a lot more growth. Perhaps many retailers will not be able to cope with the translation, which is an opportunity for us to increase market share.

When the translation situation is stable, the previous outlined plans such as shop conversion and shop expansion will be restarted.

There are many big companies who have imbalance in financial balance after the epidemic, access to bank capital is also difficult, does MWG encounter this situation?

No, we are not entangled by these difficulties.

Thank you Sir.

Doan Van Hieu Em just finished buying 80,000 MWG shares as registered, while a member of the BOD of Mobile World Investment JSC, Mr. Dang Minh Luom, registered to buy 290,000 shares but did not buy stock. Which votes. Transactions made from March 23 to April 21. During this period, the price of MWG shares sometimes reached the bottom of VND 58,900 / share, on April 21 increased by 34.8%, up to 41.7%.