STO considers abandoning retail business and venturing into tourism

State Trading Organization (STO) has said that the company was considering a decision to abandon retail business and venturing into tourism in the future. STO has been doing retail business for a long time as a state-owned enterprise, and operates the largest retail chain in the Maldives.

Shahid Ali, STO Managing Director said on Sunday that the company had a long-term plan to engage in resort business, and that Company Board envisioned a profit percentage of 25-30 from that business.

“We have been implementing a strategic plan to redirect our business into the tourism sector for a period of four years. At last, we have now reached the desired destination. We got an island for development as a resort following our undertaking to complete Fuvah Mulah domestic airport. So, we are now beginning the development of this island as a resort”, Shahid said.

STO’s first resort would be developed in B. Muthaafushi. According to MD Shahid, construction works in the island would commence within one and half months, and would be complete hopefully by December 2012.

Commenting on the decision to abandon retail business, MD Shahid said that STO had already started supplying goods wholesale to some 10 parties, and that the purpose was to find some retailers who would continue to provide retail services at STO pricing standards. Shahid said that if this is achieved, STO would most probably stop retailing. However, he assured that the company would closely analyze and study the impacts of such a big decision of the country’s retail market.