We at KResearch expect that Bangkok residents' spending on ceremonial offerings during the 2013 Chinese New Year holiday will reach perhaps THB5.6 billion, up 6.0 percent YoY, thanks to a combination of positive factors. They would include improving economic conditions that helped bolster the 2012 operating results of many businesses, which in turn translate into higher salaries and bonuses this year, particularly in the automobile, F&B, construction, property, telecom and service sectors. This, along with rising purchasing power for working consumers – because spending for home, furniture or car repairs as in 2012 following the 2011 flooding is not a factor this year – thus allows them to spend more on ceremonial offerings this time around.
However, since some businesses are coping with higher production costs (the new THB300 daily wage and rising energy costs), plus the appreciating Baht that is hurting the export competitiveness of some SMEs (for they find it harder to cope with such impact than larger firms), consumers working for such businesses might be skeptical about future employment, thus prompting them to become more cautious toward spending, or even to cut some incidental expenses during this Chinese New Year.
Nevertheless, it is expected that retail business will be a major beneficiary during the Chinese New Year holiday, as usual, since consumers now prefer the convenience of modern trade outlets, meaning that a large number of Thai-Chinese consumers will likely purchase their ceremonial offerings at shopping malls and supermarkets where such products are now available in sets at reasonable prices.