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Tile manufacturers paving the way to meet demand post-Covid pandemic

Tile manufacturers paving the way to meet demand post-Covid pandemic

12 Aug 2021

Tile manufacturers’ take on market prospects post-Covid-19 pandemic is paved with bullishness, in anticipation of growth in demand for home renovation supplies.

Creative Lab chief retail officer Keith Loh said there will be a surge in demand for home improvement and renovation materials when the full movement control order (FMCO) is lifted and renovations and remodelling are allowed.

“Currently, we are unable to manufacture tiles in factories. On the retail side, we have a lot of orders but are unable to deliver to customers because of travel restrictions and warehouses are not allowed to open. Our customers do want to renovate but are unable to do so due to the FMCO.

“We are also unable to carry out most operational activities locally. Now we focus on the export market under Niro Ceramic Group. The group has factories in Indonesia, Vietnam, China, the Philippines, and others. We are focusing (operations) on these markets since Malaysia cannot operate at this moment,” Loh told Property Take.

Creative Lab is a retail home design service operating 42 local showrooms under Niro Ceramic Group. Of this, 32 are located in the Klang Valley.

“Our group is one of the top three in terms of market size in the country. Creative Lab’s revenue in the first half of 2021 is RM10 million. Our primary focus is porcelain tiles and the sale of porcelain tiles amounting to 20% in the market share,” Loh said.

He said Malaysia’s tile consumption rate is higher than the average rate of neighbouring countries, totalling 3.2 square metres per capita.

“Thailand is around 2.6 square metres per capita while Indonesia is 1.3 square metres per capita. Local total production volume for porcelain and ceramic tiles is 100 million square metres per annum.”

Loh said Creative Lab plans to open eight more showrooms in the northern and southern parts of the peninsula by end of the year. The group will focus on franchising to make Creative Lab easy to access for customers.

“We want to have many outlets to reach out to customers in their neighbourhood so they do not have to drive all the way to a particular location to visit a showroom.

“By franchising to a local who is familiar with the town and has the right network, we will be able to reach out to new customers. We will franchise everything from the operating system to providing consultation; the franchisee focuses only on selling,” Loh said.

He observed that as people stay at home and work from home, there has been a surge in online enquiries on services and products.

“When the first MCO happened, we quickly moved our services online where customers get free 3D interior designs, online consultation through video call, and we established electronic stores on our website and e-commerce platforms.

“The challenge is that it is difficult for people to visualise the materials of the tiles so we will send small samples to the customers so they can touch the different types of tiles.”

Jubin BMS managing director Ang Kwee Peng said the group is optimistic that tile products in the renovation and retail market will have positive growth in the coming years.

“We have plans to open multiple outlets and warehouses by 2022 in the Klang Valley and Seremban and we are enhancing our internal process system, like warehouse system, POS system, QMS, and improving our retail shopping experience.

“The biggest challenge we face during this MCO is uncertainty. When we (are allowed) to resume operations, chances are we may only be able to operate at 50-70%. Also, we have to look at how far renovation and construction jobs are allowed to be carried out; it will impact our businesses for sure,” Ang said.

Jubin BMS is a tile, stone, mosaic, and sanitary ware supplier/retailer in Malaysia. Its collection includes porcelain tiles, ceramic wall tiles, natural stones, mosaic, wood tiles, large format porcelain slabs, sanitary wares fittings and accessories. The company has showrooms and outlets in 13 locations across Johor, Kuala Lumpur, Selangor, Negri Sembilan and Sarawak. It holds the Malaysia Book of Records title for Malaysia’s largest tile and sanitary ware showroom for its BMS Complex in Johor Baru.

Ang said people are spending more time at home and tend to have higher expectations for their living space. Thus, the demand for high-quality home renovation materials will increase post-pandemic.

“Besides, according to the research of Mordor Intelligence and Euromonitor, there is a growing trend for home improvement and renovation supplies in Malaysian households,” he said, adding that the pandemic has changed the buying behaviour of many consumers.

“Certain products require minimum shopping experience to see, feel and touch, digital platform will work well for the buying process. Customers make decisions based on e-commerce interface, users review, and online consultation.

“However products like ceramic tiles will then be quite different. The majority of our customers still prefer the physical shopping experience which allows them to see the products, experience the design mock-ups, and talk to the sales advisers. Also the logistics and handling for ceramic tiles may not be very e-commerce friendly,” he said.

Source: The Sun Daily