Community malls are outgrowing original concepts

Businesses need to grow, and “community malls” are no exception. They are getting bigger and swankier with each passing day. And they are also mushrooming, spreading from locations far away from mega-malls to almost right beside them. It used to be: “Come and shop with us if you are sick and tired of traffic and parking headache”, but now it is: “Come and shop with us if you can beat the traffic and don’t mind circling a few rounds for parking space”.

 Like anything else, community malls need to evolve. But worrisome signs have emerged. Shops are over-investing on decorations in fierce battles to win customers. Many have rolled over and died due to cost overruns, but that doesn’t deter new aspirants from entering the “red ocean”. The initial concept of small space, sustainable business has become something that requires large parking areas and expensive, risky investment. Many community malls are charging eye-popping parking fees and allegedly working in cahoots with the police to prevent or discourage free roadside parking.

 So, what should have opened the door for smaller business players is going the conventional way and is in serious danger of being monopolised by the big fish. The concept of sustainability is also under threat. Investment in some community malls is getting higher and higher, with much going to decoration and land purchase. And many investors are shrugging off the possibility that the intense competition is jeopardising one of the basics essential to their survival – customer loyalty.

 Many community malls’ life stories are all too familiar. They are born with a lot of fanfare, attracting big crowds of shoppers in the first few days of business. Then new places open up, boasting something that the other didn’t have or is more exciting, drawing fickle customers to new traffic and parking misery. Smaller shops would die first at the older malls, whose real battle for survival had just begun.

Pubs or nightclubs have sprung up at some community malls. Small family events are getting more lavish, with many participants arriving in Mercedes. Fewer and fewer people are going to community malls because they are convenient; more and more people are going to community malls because it’s “chic” to do so. When it has become a high-stake, high-investment endeavour, community malls may be turning into yet another place for the well-to-do or very-well-to-do to frequent. The malls have featured big brand names, partly because the malls’ owners need to attract rich customers, and partly because only big brand names have the financial viability to endure uncertainties.

It’s fair to say that some of the community malls were aimed at high-end customers from the beginning. They were conceived as “boutique malls” with jaw-dropping environment, a scene for movie or fashion shoots or spectacular product-launching events. With urban areas spreading and population increasing, it’s always nice to have a nice place to shop closer to home. However, even if we are to take the political debate away and avoid the socialism versus capitalism issue, the evolution of community malls remains a cause for concern. There are two ways to look at the fact that as long as shops have folded, they are quickly replaced by new ones: Either it’s a normal red-ocean business or the bubble is getting bigger.