AS price-conscious Malaysians hunt for bargains, the battle for their wallets is increasingly being won through purchasing power, distribution efficiency and the ability to keep prices low without sacrificing margins.
This puts 99 Speed Mart Retail Holdings Bhd
ahead of rivals MR DIY Group (M) Bhd and soon-to-be listed KK Mart. However, the challenge for all three retailers is sustaining sales growth as competition intensifies and store networks mature.
Farm Fresh Bhd faces a different test: how far its brand loyalty can sustain pricing power as households become more selective about spending.
BIMB Research
analyst Sabariah Akhair says 99 Speed Mart currently has the strongest competitive advantage among the four companies, followed by MR DIY.
“The key differentiator is its combination of nationwide scale, dense store network, proprietary distribution infrastructure and neighborhood convenience,” she tells StarBiz 7.
“Its stores are deeply embedded within residential areas, creating a high-frequency purchase model that is difficult to replicate quickly.”
Malacca Securities head of research Loui Low shares this assessment.
“Its over 3,100 outlets and extensive distribution network give it purchasing and logistics scale that rivals cannot easily replicate,” he points out.
According to Apex Research, 99 Speed Mart operated 3,151 outlets supported by 22 distribution centres as at end-June 2026.
Sabariah says MR DIY’s strengths lie in brand recognition, product variety and sourcing capabilities, although its products face greater substitution risks.
Farm Fresh, meanwhile, benefits from its established dairy brand and vertically integrated operations, while KK Mart faces intense competition from convenience stores, supermarkets and petrol station retailers.
AmInvestment Bank (AmInvest) Research says Malaysian shoppers are increasingly favouring value-for-money products amid competition from low-cost Chinese manufacturers and online platforms.
The research house maintains its “overweight” stance on the consumer sector, naming 99 Speed Mart among its preferred stocks because of its defensive business model and exposure to government assistance programmes.
Main growth driver
Despite their different business models, store expansion remains the main growth driver for 99 Speed Mart, MR DIY and KK Mart.
Sabariah estimates that new outlets generally contribute about 60% to 80% of sales growth during aggressive expansion phases, with existing stores accounting for the remaining 20% to 40%.
She says large organised retail chains typically target annual same-store sales growth of 3% to 8%, while overall revenue growth can reach the low to mid-teens through new store openings.
For Farm Fresh, growth is driven more by household penetration, product innovation and market share gains than by outlet expansion.
Low notes that 99 Speed Mart’s revenue rose 15.5% in the first half of 2026 (1H26), supported by new outlets, government assistance programmes and longer operating hours.
“MR DIY’s revenue grew 6.5%, largely driven by new stores, while existing outlets faced softer consumer spending,” he says.
For 1H26, 99 Speed Mart recorded revenue of RM6.14bil, compared with MR DIY’s RM2.63bil.
Its same-store sales growth reached 9.1% in the 1H26, although it moderated to 7.2%
in the second quarter (2Q26).
Apex Research expects the figure to normalise to about 6% annually from 2027 to 2029, compared with 7.7% in 2025.
The brokerage noted that the retailer’s average basket size had remained broadly unchanged at around RM21.40 over 10 quarters, suggesting that growth was driven by higher transaction
volumes rather than increased spending per visit.
Government assistance has also supported sales.
UOB Kay Hian (UOBKH) Research estimates that 99 Speed Mart captured nearly 15% of previous Sumbangan Asas Rahmah spending, although it cautions that growth could moderate against a higher comparison base.
Looking ahead, Sabariah sees the greatest expansion opportunities in Kelantan, Terengganu, Pahang, Sabah and Sarawak, as well as smaller towns with relatively low organised retail penetration.
Urban markets such as the Klang Valley, Penang and Johor Baru remain attractive but are becoming increasingly saturated, raising the risk of new outlets taking sales from existing stores.
“Among the three, 99 Speed Mart still appears to have the largest organic runway because of its neighbourhood-based format and ability to penetrate smaller catchment areas profitably,” she says.
Low similarly identifies Sabah, Sarawak, the East Coast and smaller towns as key growth markets.
“99 Speed Mart targets around 250 new outlets annually, with each serving a catchment of 1,500 to 2,000 households to minimise cannibalisation. KK Mart also has considerable opportunities outside the Klang Valley,” he says.
Apex Research expects 99 Speed Mart’s network to reach approximately 4,250 outlets by 2030, although expansion into less densely populated areas could raise logistics costs and put pressure on store productivity.
Beyond store networks, private-label products are becoming increasingly important in helping retailers compete on price while protecting margins.
Sabariah says MR DIY’s private-label and exclusive products improve margins, differentiation and customer loyalty while reducing direct price comparisons.
For convenience retailers such as 99 Speed Mart and KK Mart, private labels play a supporting role but are less dominant than in household goods and personal care.
Farm Fresh, however, enjoys greater brand-driven pricing power.
“We believe Farm Fresh enjoys significantly greater pricing power than the retailers because consumer purchasing decisions are more brand-driven in fresh milk than in convenience retail,” Sabariah says.
Low notes that Farm Fresh’s brand loyalty has allowed it to raise prices selectively, including a 3% increase on certain Malaysian products, although consumer affordability remains a constraint.
Procurement leverage
On supply-chain efficiency, Sabariah says MR DIY benefits from its direct-import capabilities, while Farm Fresh’s integrated dairy operations provide cost control and ensure consistent quality.
KK Mart, being smaller in scale, has less procurement
leverage than 99 Speed Mart.
Low says 99 Speed Mart’s gross margin remained at around 20% in the 1H26, while operating expenses grew more slowly than revenue.
According to Apex Research, the group’s gross margin improved from 19% in 2024 to 20% in the 1H26 on a restated basis.
Administrative and other operating expenses increased 13.3% during the period, compared with revenue growth of 15.5%, indicating positive operating leverage.
Nevertheless, rising labour costs and cheaper online alternatives could test retailers’ ability to defend margins.
UOBKH Research expects the planned increase in Malaysia’s minimum wage to RM2,000 in June 2027 to affect fewer than 5% of 99 Speed Mart’s workforce, compared with about 20% to 25% at MR DIY.
AmInvest Research also cautions that low-cost Chinese products and online platforms pose greater risks to discretionary retailers such as MR DIY, whose products are more easily substituted.
Sabariah believes 99 Speed Mart remains best positioned
to withstand intensifying price competition, followed by MR DIY, while Farm Fresh’s defence rests more on brand loyalty than cost leadership.
Ultimately, the contest for Malaysian wallets is shifting from who can offer the lowest prices to who can sustain them most profitably.
For 99 Speed Mart, the next test is whether its growing network can continue to deliver stronger sales and earnings
without sacrificing margins.
