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Azmir said McDonald’s Malaysia has long-term plans to open 20 new restaurants in Kelantan within a period of five years.

KOTA BARU: Fast food chain McDonald’s Malaysia will open five new restaurants in Kelantan by next year, says McDonald’s Malaysia managing director and local operating partner Datuk Azmir Jaafar.

He said two new restaurants will open this year, while the rest are expected to open next year.

“A new restaurant will be opened next week in Troika, Kota Bharu, and another before the end of this year at the Gua Musang rest and relax stop. Three more locations have been identified in Pasir Puteh and Tumpat, respectively, and they will be opened next year,” he said after McDonald’s Malaysia corporate zakat payment ceremony to the Kelantan Islamic Religious and Malay Customs Council and Qurban donations here yesterday.

Azmir said McDonald’s Malaysia has long-term plans to open 20 new restaurants in Kelantan within a period of five years.

“Every restaurant needs 100 workers, so with 20 restaurants we can hold (offer) over 2,000 new jobs to locals,” he said, adding that the fast food chain does not hire foreigners.

Meanwhile, in a recent report, CGS-CIMB Research said the Malaysian consumer sector is expected to see declining spending and margin pressures on the back of a weak macroeconomic outlook due to higher inflation, rising interest rates and subsidy cuts.

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The research house said it expects consumers to focus their spending more on daily necessities, rather than discretionary items, in the second half of 2022.

“We downgrade Malaysia’s consumer sector because we expect the weak macroeconomic outlook, for example, spike in inflation, interest rate hikes, and cuts in subsidies, to erode consumer spending ability, resulting in slower demand for consumer goods, mainly discretionary items. In addition to margin compression and rising cost pressures, we expect companies to face a more subdued operating environment.”

In the second half of 2022, CGS-CIMB Research said it expects consumer spending to normalise from a high base in the first half of this year.

“The strong sales were driven by pent-up demand and revenge spending, following the easing of lockdown measures and festive celebrations not subject to Covid-19 restrictions, unlike in the previous two years,” it said.

CGS-CIMB Research added that it expects consumer companies to see margin pressure in the second half of 2022 due to higher operating expenses in labour, utilities, miscellaneous, weaker ringgit and higher input costs.

“While most consumer companies under our coverage can raise product prices to offset higher input costs, we think there is limited room as further selling price hikes could come at the expense of sales volumes. Hence, we expect consumer companies to absorb some of the higher costs in a bid to support sales volume, resulting in margin compression,” it said. — Agencies

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