RADIANT Globaltech Bhd is poised to gain from the accelerated digitalisation of the retail sector by the Covid-19 pandemic.
MD Paul Yap Ban Foo (picture) said the retail solution provider’s revenue would be driven by digitalisation and automation by retailers to reduce cost and increase efficiency to weather the crisis.
“Going forward, we expect to achieve strong revenue growth on increasing demand for digitalisation and process automation, complemented by the inclusion of Grand-Flo Spritvest Sdn Bhd (GF Spritvest), which allows us to expand in the industrial segment.
“We acquired GF Spritvest to expand our suite of products and services to support industrial players in the fast-moving consumer goods, manufacturing and courier service subsectors,” Yap told The Malaysian Reserve in an email interview recently.
He said the GF Spritvest acquisition is timely as it provides an additional income stream when the Covid-19 pandemic badly hits the retail sector.
In October last year, Radiant Globaltech’s shareholders approved the acquisition of an 80% stake in GF Spritvest for RM11.6 million cash.
GF Spritvest, a unit of Main Market-listed Grand-Flo Bhd, provides electronic data capture and collation solutions that enable businesses to manage and collate data with barcode and radio-frequency identification technology.
Besides targeting various subsectors, including manufacturing and distributing companies, Yap said they intend to integrate their industrial software and hardware equipment into highly customisable portals and develop a similar portal for the industrial segment.
“We also intend to bring GF Spritvest industrial solutions to the overseas markets in which we have established a direct presence.
“With the rollout of vaccinations to the masses, we want to be well-positioned to ride the recovery trend and capture the surge in demand for digitalisation of operations,” he said.
Yap added that Radiant Globaltech would focus on enlarging its supplier base and attract more retail chains to use its AX Retail B2B portal, a solution aimed to improve supply chain management.
He said the company’s retail management portal can still grow with more modules and high customisation suitable for various platforms.
“Currently, retailers are experiencing lower customer traffic at retail outlets, which leads to reduced capital expenditure for the year. This impacts our top line as we have fewer rollouts of projects.
“However, we were able to minimise the impact through the subscription model for AX Retail B2B portal and acquisition of GF Spritvest,” he said.
Yap said he is optimistic about the outlook, but remains cautious on the retail sector still facing the Covid-19 impacts. Still, the speed-up in digitalisation is a silver lining.
“Due to the economic uncertainties, retailers are more cautious on purchasing new retail hardware equipment to preserve cashflow. Retailers are also increasingly aware of the need to streamline operations through digitalisation and automation to improve efficiency, reduce human error and become more competitive,” he said.
He said the AX Retail B2B portal could support the automation of physical businesses and the back-end operations of e-commerce platforms.
Since 2009, the AX Retail B2B portal has grown from 2,000 suppliers on board from end-2018 to 4,750 as of December 2020.
Since the company’s listing, Yap said some notable brands had joined the retail management portal, such as 7-Eleven Malaysia, Manjaku Baby Mall and Sogo.
He said the company aims to add over 5,500 trade suppliers registered on AX Retail B2B by year-end.
Yap said retailers are facing challenges of streamlining their operations during Covid-19 to enhance their bottom lines and to adopt digital technologies to reduce physical contact with suppliers.
He said the AX Retail B2B allows businesses to automate the whole supply chain’s documentation workflow from purchase orders to payment advice.
Meanwhile, the Arms Software International Sdn Bhd (ARMS) acquisition in May 2021 has enabled the group to capitalise on the increasing demand for retail technology.
“This acquisition allows us to leverage ARMS’ affordable price points for retail management systems, and to also cater to the rising demand of digitalisation among retailers in Malaysia,” he said.
The company’s hardware segment was the main topline generator, contributing 63.6% of its total revenue in the financial year 2020.
The software segment contributed 14.7% to revenue, while the maintenance and technical support services segment accounted for 21.7%.
ARTICLE BY The Malaysian Reserve
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