While addressing a group of journalists at a local hotel, Siddiqui shared that the company wants to open four or five new stores, making an investment of over Rs4 billion by 2014. “Today, I can safely say that we are among the top 20 companies of the country, although our journey started just four years back.”
Responding to a question, he said that retail and wholesale chains are now looking to enter developing countries because the more developed markets have reached saturation. “A number of players like us want to invest in the country. The moment we come out of security problems, Pakistan will receive huge investments in this sector,” said Siddiqui.
The average income of rural population of Pakistan has been increasing, especially in the last two years, he informed, adding that because of this few people are migrating to big cities now compared to the past.
“An interesting trend that has been observed is that the sales of personal care products have increased as a younger demographic has entered the workforce in urban centres.”
Explaining his company’s business model, Siddiqui said that Makro was neither a super-store nor a retailer that served end-consumers. Rather, the company works on a business-to-business model. “We are wholesalers, or distributors, who bridge manufacturers with retailers. Profit margins of manufacturers and retailers are more compared to wholesalers. We do business in bulk with lower profits,” he said.
Regarding the reformed general sales tax (RGST), he commented: “Fundamentally, I am with the RGST regime but my concern is implementation.”
Published in The Express Tribune, December 15th, 2010.
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