SM Retail expects to invest as much as P6 billion each year to expand its nationwide footprint and to bolster further its market leadership.
To date, the retail arm of leading conglomerate SM Investments Corp. (SMIC) operates 2,303 stores with a combined selling area of 2.6-million square meters nationwide.
“Most of SMIC’s capital outlays will come from SM Retail, which typically spends P4 billion to P6 billion a year for annual expansion,” said SMIC vice president for finance Frank Gomez in a press briefing after the group’s stockholders meeting on Wednesday.
SMIC’s newly appointed chair Jose Sio also said the SM group was ready for e-commerce, but noted that this business was still in its infancy.
Unlike how e-commerce has gained ground in China and the US, Sio said the Philippine economy was “not yet at that stage” given the needed infrastructure.
“E-Commece may have problems on delivery, problems on security. It may have problems in the provinces,” Sio said, noting that unlike in the metropolis, many people in provincial areas still did not have access to smartphones.
Sio added: “It might take some time to develop [e-commerce here]. But having said that, we are preparing ourselves.”
Investing in leading logistics company 2GO Group Inc. was one of the preparations being made by SM to face head on the potential of e-commerce, Sio said. He added the group already has the existing backbone for the delivery and collection portion of e-commerce.
“We are ready to go into the next stage, we at SM, but it’s the market that’s not yet ready,” Sio said.
Under SM Retail, the group has 57 department stores under “The SM Store” brand, 48 supermarkets, 44 hypermarkets, 156 Savemore grocery stores, 39 Waltermart stores, 210 Alfamart convenience stores and 1,749 specialty stores.