New businesses mushroom in Malaysia despite COVID-19 pandemic gloom
Malaysia’s economy has not been spared the fallout from the coronavirus and is expected to contract by up to 4.5 per cent this year. REUTERS via The Straits Times/Asia News Network
KUALA LUMPUR — Educator Sujietra Jayaseelan was meant to set up a physical after-school coaching center for children in Petaling Jaya, Selangor, but her plan was scuppered in March when Malaysia imposed a partial shutdown to curb the spread of the coronavirus. After observing her own children study at home when schools were shut, she instead launched Green Patch Academy, an online center offering academic and skills coaching for children.
“The online method had never crossed my mind before. I also offered a very low price bearing in mind the impact of the pandemic on people’s finances. It would have been so cheap if this was my initial idea,” she told The Straits Times.
Green Patch is just one of the nearly 280,000 new businesses registered in Malaysia between March and September, defying the pandemic gloom with fresh enterprises in sectors such as food and beverage, online retail and fitness.
This figure far outpaced the number of businesses that had shuttered since March – at 32,469, according to the Companies Commission – when the country introduced drastic movement curbs to contain the outbreak.
Entrepreneur Development and Cooperatives Minister Wan Junaidi Wan Jaafar described this development as a silver lining, saying local entrepreneurs were adapting their business models to be resilient during challenging times.
“I applaud this as such a move is vital for their business survival. An entrepreneur must be innovative, creative and dynamic to adjust and adapt to whatever situation they are in,” Datuk Seri Wan Junaidi told The Straits Times.
Malaysia’s economy has not been spared the fall-out from the coronavirus and is expected to contract by up to 4.5 percent this year. Meanwhile the latest Business Confidence Index released by local ratings agency RAM on Dec 7 stood at 35.9 percent, still substantially below the 50 percent threshold needed for it to be read as optimistic.
Nevertheless, some entrepreneurs are forging ahead.
A majority of these new businesses, Mr Wan Junaidi said, operated in the food and beverage sector, followed closely by online retail shopping businesses.
“Another interesting area is also the fitness industry. Because there are some people who are scared to go to gyms, there is an increasing demand for virtual fitness classes and personal training,” he said.
New entrepreneurs have pressed ahead with their business plans, all while pivoting on short notice when circumstances change.
Ms Dhashene Letchumanan, a former marketing executive, had been planning to sell her Skin Start beauty products at physical stores before the pandemic hit. By the time she launched her skincare line, movement controls were in place, forcing her to switch to online retail.
“I could have sold my products through retail stores, booths or kiosks if there was no pandemic. But now the best option is to just stay online and use dropshippers, which is a way to generate income for others who have lost their jobs,” Ms Dhashene told ST, referring to the practice of selling a product without holding stock, leaving orders to be fulfilled by the wholesaler or another retailer.
Meanwhile, other new businesses have been set up with the help of civil society organisations and social enterprises.
A group of construction workers who lost their jobs after Covid-19 clusters were discovered at their worksite now run The Nanas Lab, a business making pineapple jam.
“They have been growing pineapples to eat when their food supplies run out,” said Ms Raudhah Nazran, CEO of social enterprise Accelerate Global. “We saw that as a business opportunity and taught them how to monetize their farm.”
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