Texchem Resources Bhd’s subsidiary Sushi King Sdn Bhd will close down unprofitable Sushi King outlets in the country in 2020. Group executive chairman Tan Sri Fumihiko Konishi said that the unprofitable outlets were mainly located in shopping malls that imposed high rentals.
Due to the high rentals, Sushi King plan to close its outlet in KLCC
There are 137 Sushi King restaurants in the country, including 25 outlets in Sabah and Sarah. According to Tan Sri Fumihiko Konishi, they are planning to shut one in KLCC because of the high rentals. The outlets in the rural areas are making profits because of the low rentals.
Consumer spending at Sushi King outlers has dropped because of the economic uncertainties. “The people prefer to eat at hawker centres where there are no sales and service tax,” he said.
Sushi King plans to spend less money on its operations next year
“We want to spend less money, stay cautious and reduce headcount through a rationalisation plan.” Fumihiko Konishi also added that the group would also control its inventories and shorten the period of credit to control trade receivables. The chain currently employs over 6,000 workers.
The group generates between RM30mil to RM40mil annually
The group is still healthy and able to generate between RM30mil and RM40mil in cash annually from all its business divisions. They have been doing that for 26 years.
According to the Conference Board Consumer Confidence Index Q2 2019, the reported said that in the second quarter 2019, a vast majority of consumers (87%) said that they have adjusted their spending habits to save on household expenses.
“They save by spending less on new clothes (48%), trying to save on gas and electricity (44%), switching to cheaper grocery brands (43%), cutting down on out-of-home entertainment (42%) and reducing holidays and short breaks (36%), ” the report added.