Mobile World asks for a 50 per cent discount in rental costs

Thursday, Apr 09, 2020 11:53

A store of The Gioi Di Dong in Ngoc Hoi, Thanh Tri Ha Noi. Mobile World JSC is asking for a store rental cut for the chain as they face difficulties during the pandemic. — Photo

Mobile World JSC, one of the biggest retailers with more than 3,000 stores nationwide, is asking for a 50 per cent discount on its store rental costs across the country for 12 months due to the COVID-19 pandemic.

It also asked partners not to collect rent for the time its stores could not open due to social distancing.

As most of the retail spaces for The Gioi Di Dong and Dien May Xanh chains were rented, the firm was facing cost pressure like most other businesses during the pandemic and social distancing which stopped the operation of non-essential stores.

On March 31, the firm sent documents asking the owners of its retailing spaces for a reduction of 50 per cent in rental. Mobile World said though it has reduced operating costs, it could not deal with the current situation.

The document said: "At present, there is no clear information about the end of the pandemic or when the market will recover, so the company and all employees still face many difficulties in the future.”

Mobile World said it will discuss plans directly with specific owners.

In a recent online meeting with investors, Mobile World leaders announced revenue in March reached more than VND8.5 trillion, an increase of 12 per cent from the same period last year thanks to the positive contribution of the food chain of Bach Hoa Xanh. Online revenue, 10 per cent of the total revenue in March, tended to increase.

However, they also said: “It was difficult to make accurate business scenarios due to the pandemic.”

The total number of The Gioi Di Dong and Dien May Xanh stores mostly in Ha Noi that have been closed by the end of March accounted for 10 per cent of the total stores of the two chains.

Amid the difficulties, chairman of the firm Nguyen Duc Tai said the company won't sack its employees as “human resources are a valuable resource of the firm” and they would be a “weapon” to help the firm grow when the market rebounded.

Instead, Tai will cut other costs to overcome the difficulties. — VNS

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