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Don Don Donki's Bangkok Exit Signals Retail Cost Pressures

Don Don Donki's Bangkok Exit Signals Retail Cost Pressures

Provided by Nation.

Japanese discount chain to shutter Bangkapi store, its second Thai closure, highlighting the need for businesses to control rising overheads amid economic headwinds

 

Japanese discount retailer Don Don Donki is set to close its branch in The Mall Lifestore Bangkapi, Bangkok, marking the second such closure in Thailand and serving as a stark reminder of the increasing pressure on businesses to manage escalating costs.

 

The move comes just under two years after the Bangkapi store opened in December 2023, with its final day of trading scheduled for 12th May 2025.

 

This will reduce Don Don Donki's Thai footprint to seven stores, down from the eight it operated across the country, including locations in Thong Lor, Silom, MBK Center, and various suburban malls.

 

This isn't the first retrenchment for the popular Japanese chain in Thailand. Back in September 2022, Don Don Donki closed its branch in The Market Ratchaprasong, having opened there in March 2020.

 



 

These closures represent a recalibration of Don Don Donki (Thailand)'s expansion strategy following the disruption caused by the COVID-19 pandemic.

 

Initial ambitions were to reach 20 stores by 2025, but this target was revised down to a more modest three new openings per year in the wake of the pandemic's impact.
  



 

An examination of Donki (Thailand) Co., Ltd.'s financial performance, as reported to the Thai Department of Business Development, reveals a mixed picture of revenue and net profit between 2020 and 2024:


2020: Total revenue 727 million baht, Net profit -206.00 million baht
2021: Total revenue 1,067 million baht, Net profit 22.84 million baht
2022: Total revenue 1,614 million baht, Net profit 102.33 million baht
2023: Total revenue 2,119 million baht, Net profit -2,116.58 million baht
2024: Total revenue 2,171 million baht, Net profit 140.83 million baht


 

Don Don Donki's initial foray into the Thai market began in February 2019 with the opening of its flagship Thong Lor store within the DONKI Mall Thonglor.

 

This venture was initially managed by Pan Pacific Retail Management (Singapore) Pte. Ltd. (PPRM), a subsidiary of Japan's Pan Pacific International Holdings Corp. (PPIH).

 



 

However, in 2020, Saha Pathanapibul Public Company Limited and TOA Venture Holding Co., Ltd. joined as investment partners, resulting in a revised shareholding structure: Pan Pacific (60%), Sahapat (22%), and TOA (18%).

 

This led to a rebranding of the Thai operation from Donki Thonglor Co., Ltd. to Donki (Thailand) Co., Ltd., with a registered capital of 750 million baht.
  

Following this restructuring, Don Don Donki embarked on an expansion drive, targeting prominent locations within major shopping centres and areas with significant tourist footfall.

 



 

The current decision to close the Bangkapi store signifies a further strategic adjustment. In a challenging economic climate, "downsizing" to manage costs is a tactic employed by numerous businesses seeking to reduce outgoings and bolster performance in their remaining outlets.

 

The retail sector will be watching closely to see how Don Don Donki's remaining seven Thai branches will navigate the economic headwinds and consumer spending patterns in the latter half of 2025.

NATION

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AFP-JIJI PRESS NEWS JOURNAL


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