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Monday, August 24, 2015

Sundry shops owners in debt after Tukar programme turns hope into loss

The typical sundry shop was the target of the Small Retailer Transformation Programme (Tukar) but it seems to have hurt many business owners with forced loans and unnecessary renovations, according to some of the participants who signed up for the programme. – The Malaysian Insider file pic, August 24, 2015.The typical sundry shop was the target of the Small Retailer Transformation Programme (Tukar) but it seems to have hurt many business owners with forced loans and unnecessary renovations, according to some of the participants who signed up for the programme. – The Malaysian Insider file pic, August 24, 2015.Jancy had to switch her business in Lorong Kurau, Bangsar from a sundry shop to an eatery to support herself and her two college-going children, after incurring a RM60,000 debt when she registered under the government's Small Retailer Transformation Programme (Tukar).
"RM40,000 was allocated for the refurbishment, where they only added some lights, painted, rearranged my shop, fixed the wiring, racks and my cash machine. I don't think the real costs would come up to that.
"The other RM20,000, was allocated to buy sundry goods. They appointed a consultant from a huge supermarket (Checkers) to supervise us and we had to spend the RM20,000 in one day at their outlet," the 50-year-old, who only wanted to be known as Jancy, told The Malaysian Insider.
Tukar is aimed at modernising and enhancing the competitiveness of traditional retail stores. A loan, plus supervision or advisory services from the ministry, are supposed to turn such stores into modern retail businesses.
But Jancy found that the sundry goods recommended to her by the consultant from the partner supermarket had to be thrown away shortly after because it had reached their expiry dates.
"Shampoo, boxes of instant noodles, chili sauce, soy sauce and other sundry goods had to be thrown out. When buying those things, I did not think that most of it will reach the expiry date so quickly.
"At the same time, the consultant told me that if I bought those things, it would definitely be sold out because my redecorated shop would draw in customers," she said.
Jancy said she first decided to register under the programme in 2012 after hearing about it on the radio.
"I was open to it because I thought it could generate more profits and besides, they told me that my store would transform to become like 7-Eleven."
After a year of losses since joining the programme, she turned her shop into an eatery, a move she said was embarrassing as people began to find out about her debt.
"I lost a lot. The RM60,000 loan had to be paid as Tukar's lawyers came to my store and threatened to drag me to court if I did not pay up my debts.
"I had to change my business. If I had depended on the sundry store for money, my children and I cannot survive," said the single mother, whose husband died in 2006.
"Friends who wanted to register their stores with Tukar, asked for my opinion. I told them not to."
Now, in order to support her family and repay the loan, Jancy said she worked at her eatery from 7.30am to 10pm daily.
Another Tukar participant, Mary P. John, 70, whose family owns Prem Mini Mart in Taman Bukit Desa, Kuala Lumpur, said she suffered the same fate when she registered her sundry shop under the programme two years ago.
"My friend suggested we do so and my son-in-law Prem registered the shop under Tukar because they said it would help small businesses like ours to develop. At that time, we also did not have enough money to continue buying things for the store.
"Tukar came to our store to do the refurbishment so that it would look better and gave us a loan of RM70,000. The refurbishment cost more than RM30,000.
"What was so good about the redecoration that they did? They gave it all to their own contractors," she said.
Tukar also set RM30,000 as capital to purchase new products for the refurbished shop and recommended buying items wholesale from a supermarket in Masjid India, Kuala Lumpur, since most of the items Prem Mini Mart sold were Indian products.
"The place that was recommended was expensive but we had to follow their instructions and were ordered to buy the sundries from the supermarket in a big bundle. In the end, much of the items were not sold and had to be thrown away.
"Goods like flour, dhal that expired, had to be thrown away," Mary said.
Mary admitted that she did not make enquiries nor did she seek advice from anyone before deciding to register the family business under Tukar.
"We feel cheated and are still paying back the loan. Because of that, my relatives have blamed me for proposing the idea to register under Tukar," she added. Her sundry shop is still operating, but has not recovered from the heavy loss.
The Malaysian Insider has requested an interview with the ministry for a reaction to these cases, and for figures on Tukar's success rate, but has not received any response.
According to the Auditor-General's Report released in April 2014, however, about 26% of 70 shops under Tukar had registered a decline in sales while another 14% had to fold.
The report noted, however, that the losses were also due to competition from other retailers in the same area.
Pemandu, the performance management delivery unit under the Prime Minister's Department, has also defended Tukar, noting that as of the end of last year, or the programme's fourth year of implementation, 1,914 stores had been transformed.
This translated to 38% of the programme's cumulative progress of reaching the targeted 5,000 stores by 2020, Pemandu said.
- TMI

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