Page 163 - CRC_One Report 2021_EN

Business Overview and Performance Corporate Governance Financial Statements Enclosure

• Nationalism trend, protests and social movements.
• Consumer’s income decrease after tax;
• Deflation in personal loan;
• Higher household debts;
• Tax increase and changes in tax laws or other laws;
• Prices of fuel, energy and other commodities;
• Deceleration of housing market;
• Higher insurance premium rates and health-related expenses;
• Reduction in tourist numbers;
• Political uncertainty
• Higher consumer prices due to the increase of the commodity prices or the market forces

During the second to third quarter of 2021, the overall economy has been adversely affected by COVID-19 pandemic
that impacted consumer spending, domestic and international tourism. In addition, international tourists significantly
declined, and any virus mutation posed negative impact to economy and lead to slow recovery of Thai economy
in the short term. Moreover, Thai economic outlook significantly faces with various uncertainty and risk.

Although the COVID-19 situation has gradually improved in the fourth quarter of 2021, consumers were cautious on
health and safety as well as not fully recovered of purchasing power. As a result, consumers being cautious in spending,
focus on essential products such as food and beverages and personal-use products. Meanwhile, purchase of
non-essential goods such as clothing, shoes and others tends to decline continuously.

In addition, other marketing and economic factors may affect Central Retail’s business as the costs of Central Retail
or its partners increase, or the market fluctuation or economic volatility increase. Apart from that, there are several
uncertainty factors such as the severity of the COVID-19 pandemic. However, if retail markets in Thailand, Vietnam
or Italy are influenced by the factors, Central Retail’s sales may decrease, higher expenses and lower net profit
margin. This could have a material adverse effect on the business, cash flow, operating results, financial position
and business opportunities of Central Retail. Therefore, Central Retail has closely focused on its operation.

In this regard, Central Retail focuses on maintaining its competitiveness and implement core business competency
in order to operate under the rapid changing of customer behaviors by applying sustainable business development
strategy. Central Retail focuses on product offering, services and experiences that cater to the lifestyles of
each customer group, along with organizing activities to respond customers’ needs with have similar interests.
In addition, Central Retail also attaches importance to creating a good customer experience by collecting and
analyzing quality data in order to analyze and understand the true needs of each customer. With online and
offline data being connected, Central Retail is able to analyze the actual needs of customers and deliver
a tailored experience to create an impressive personalization strategy.

(3) Emerging risk on cybersecurity threats and digital infrastructure to support the growth
of business operations through online channels via Omnichannel Strategy

Advanced information technology systems are applied in daily business operation of Central Retail which include
distribution, inventory management, procurement, supply chain management, warehouse management,
logistics management, credit card payments and other payment services, administration, accounting and finance,
human resources management and payroll. Moreover, Central Retail relies heavily on information technology
systems to conduct business through online channels, e-commerce and in-store channels including omnichannel
platforms for collecting and analyzing consumer data in order to offer modern service to cater customer needs.

Annual Report 2021 (Form 56-1 One-Report) 163