Business
Local retail industry: the hardest hit by the FOREX crisis calls for solutions
The retail industry has been under tremendous pressure to deliver during the past one and a half years, mainly owing to closures and disruptions due to the pandemic. The situation has been exacerbated since mid-2021 due to increasing pressure on imports, which has been a core requirement for many retail businesses. The retail industry in Sri Lanka plays a vital role in the country’s economy and it is pertinent to note that the national retail sales in Sri Lanka are approximately USD 13 Bn. As a growing industry over the past years, it accounts for about 23% of the country’s GDP. This industry also represents 14% of the labour market, with more than 1,100,000 people being employed within this sector in Sri Lanka. Additionally, the overall retail industry contributes significantly to the economic value chain of the country in many ways.
The current FOREX crisis and the resultant import restrictions have pushed many of these businesses to the brink of collapse. Consumer durables, clothing and related industries are a case in point where there had been product shortages regularly due to the inability to gather adequate foreign exchange through the banks to fund imports and fulfill local requirements. The situation is moving from bad to worse, with many large entities struggling to keep their branches and facilities open due to a lack of goods for sale. If this continues, it is likely to result in the closure of stores, severely impacting the livelihood of many directly and indirectly dependent on these businesses. This could eventually lead to significant job losses and impact the local economy and result in wider social issues.
Retail is an integral part of the tourism industry and building Sri Lanka as a destination of choice. Notwithstanding, the business losses to thousands of retailers and the affiliated industries such as rental properties currently occupied by these entities, logistics and related businesses providing infrastructure support to several others, such as advertising to service affiliates, would be hard-pressed to survive given the sudden drop in volumes. Education and communication are another two key industries that have been impacted by the FOREX crisis and they too require essential products including computers and communication equipment, which could end up beyond the means of the average citizen both due to the short supply of these goods and increasing cost of imports.
As an industry that contributes heavily with over 25% of GDP and large numbers in employment, a preferred status should be accorded to facilitate FOREX requirements through the banking sector. This would be of national importance given the magnitude of the industry and its contribution toward the overall wellbeing of the economy. The impact of the FOREX crisis on this industry, however, has seen an escalation of grey market activities. This escalation and the establishment of an unorganised business sector could have not only severely impact government coffers but create unmanned parallel imports as well.
The Sri Lanka Retailers’ Association (SLRA) calls on the government and authorities to effectively bring about a system to facilitate the sector’s business continuity through a planned set of actions. One option to consider would be an allocation of FOREX to this sector based on what is available for a given month; thus, there is a particular element of certainty on imports and to manage the uncertainty that prevails currently, to be better. It is also imperative that authorities work out modalities to address the situation where FOREX availability improves soon.
The Sri Lanka Retailers’ Association (SLRA) was established in 2015, which aims to harness the resources of the organized retail industry to a common platform to promote growth, innovation, and global outreach. The association currently consists of 50 corporate members, comprising the organized sector, with over 5000 outlets across 9 sectors in the retail industry.
Major stock markets in Asia slumped on Monday after Washington and Tehran threatened to escalate hostilities, as the Iran war enters its fourth week.
Japan’s benchmark Nikkei 225 index was almost 3.6% lower, while South Korea’s Kospi fell by almost 6%.
US President Donald Trump warned on Saturday that he would “obliterate” Iranian power plants if Iran did not open the key Strait of Hormuz shipping route. Iran said it would respond to any such strikes by targeting key infrastructure in the region, including energy facilities.
Japan and South Korea have been particularly impacted by the conflict, as they are heavily dependent on oil and gas that would normally pass through the strait.
Iran has effectively blocked the Strait of Hormuz, one of the world’s busiest shipping channels, since the US and Israel attacked the country on 28 February.
About 20% of the world’s oil and liquefied natural gas (LNG) usually passes through the waterway – and the war has sent global fuel prices soaring.
On Monday, International Energy Agency chief Fatih Birol said that the war could see the world facing its worst energy crisis in decades.
Speaking at the National Press Club in Australia’s capital, Birol compared the current energy crisis to those of the 1970s and the impact of Russia’s 2022 invasion of Ukraine.
“This crisis as things stand is now two oil crises and one gas crash put all together,” he said.
“If Iran doesn’t FULLY OPEN, WITHOUT THREAT, the Strait of Hormuz, within 48 HOURS from this exact point in time, the United States of America will hit and obliterate their various POWER PLANTS, STARTING WITH THE BIGGEST ONE FIRST!,” Trump said in a social media post published at 23:44 GMT Saturday.
That threat came after Iranian missiles hit the Israeli city of Dimona, and shortly before a second attack on the town of Arad nearby.
Mohammad Bagher Ghalibaf, the speaker of the Iranian parliament, said on Sunday that energy and desalination infrastructure in the region would be “irreversibly destroyed” if his country’s power plants were attacked.
Such action would significantly escalate the conflict, which has already disrupted global energy supplies, pushing up prices and causing fuel shortages.
Other markets in the Asia-Pacific region were also lower on Monday.
Hong Kong’s Hang was down by almost 3.5% and the Shanghai Stock Exchange Composite index 2.5% lower.
Global oil prices were broadly steady, with Brent crude 0.45% higher at $112.69 (£84.56) a barrel and US-traded oil was up by 0.7% at $98.93.
[BBC]
Human resources remain the biggest challenge despite advanced logistics
Industry-wide cost pressures are also beginning to surface
In Sri Lanka’s pharmaceutical trade, the journey of a medicine does not end when it arrives at the port. It must still travel safely across the island – through regulated warehouses, temperature-controlled transport and complex distribution routes – before reaching the pharmacy shelf where patients need it.
That journey is increasingly being powered by Healthguard Distribution, the pharmaceutical logistics arm of Sunshine Holdings, whose expanding distribution network now plays a critical role in ensuring the reliable movement of medicines across the country.
At the centre of that network is the company’s Western Regional Distribution Centre (WRDC), a temperature-controlled logistics hub designed to support the safe storage and efficient distribution of pharmaceutical products across the Western Province.
Spanning nearly 18,920 square feet, the facility functions as a key node in the company’s islandwide distribution system. Originally acquired in 2008 to serve as the main warehouse for Swiss Biogenic Ltd., the site evolved alongside the company’s growing operations. Following a major upgrade programme that began in July 2024, the facility recommenced operations in July 2025 as a fully compliant regional distribution centre aligned with international quality standards.
According to Sunshine Pharmaceuticals and Healthguard Distribution Chief Executive Officer Shantha Bandara, the company’s logistics model is built around a simple but comprehensive concept.
“Our approach is ‘Port to Pharmacy’,” Bandara said during a recent media visit. “We collect pharmaceutical consignments from the Port of Colombo, clear them through Customs, store them under regulated conditions and then distribute them to pharmacies across the country. Importers and manufacturers do not have to worry about logistics – we manage the entire process.”
The distribution network today serves over 4,500 authorised pharmaceutical outlets, including pharmacies, hospitals, channeling centres, supermarkets and SPC Osusala outlets. Operations span 150 main towns and 466 sub towns, supported by 111 active delivery routes and seven regional distribution centres located across the island.
Within that system, the WRDC is the largest and among the most technologically advanced hubs.
The facility maintains strict cold-chain conditions for temperature-sensitive medicines. Its cold room capacity has been expanded from 15 cubic metres to 30 cubic metres, enabling compliant storage of products such as insulin within the required 2–8°C range. Online temperature monitoring systems operate across all storage zones while data loggers are used for insulin deliveries to ensure product integrity throughout the supply chain.
Delivery vehicles are also equipped with GPS tracking and temperature monitoring systems, allowing real-time visibility of shipments.
Automation and digital systems are increasingly shaping the operation. Software automation supports invoicing and customer credit verification, while sales teams use digital tools for order canvassing. The company’s enterprise systems provide real-time inventory and accounting visibility, supported by data dashboards used for operational decision-making.
To safeguard continuity, the facility is equipped with a high-capacity backup generator and dedicated on-site fuel storage, ensuring cold rooms, monitoring systems and warehouse operations remain functional even during power outages.
Behind the infrastructure is a workforce of 102 employees, supported by a specialised 15-member value-added services team trained in Good Distribution Practice (GDP), cold-chain management, safety and emergency response.
Yet despite the sophisticated logistics and infrastructure, Bandara told The Island that the most persistent operational challenge lies in human resources.
“We have the infrastructure, the logistics systems and the operational capability,” he noted. “However, maintaining the required number of skilled employees is an ongoing challenge because the labour market is constantly fluctuating. Our HR team is continuously recruiting and training to keep the workforce at the required level.”
Industry-wide cost pressures are also beginning to surface. Company officials noted that rising fuel prices could eventually affect transportation and electricity costs within the distribution chain, which may in turn influence pharmaceutical logistics expenses in the short term.
Still, the broader goal of the company remains unchanged – ensuring that medicines reach patients safely and on time.
From the moment a shipment arrives at the Port of Colombo to the point it reaches a pharmacy shelf, the process depends on precision logistics, regulatory compliance and operational discipline. For Sri Lanka’s healthcare supply chain, Healthguard Distribution’s growing network is becoming a key driver of that journey from port to pharmacy.
By Sanath Nanayakkare
Singer Sri Lanka, the nation’s foremost retailer of consumer durables, celebrates a truly historic milestone at the SLIM-KANTAR People’s Awards 2026, securing a prestigious triple victory while marking 20 consecutive years as the People’s Brand of the Year, an achievement made possible by the enduring trust and loyalty of Sri Lankan consumers.
This year, SINGER was honoured with yet another triple win with People’s Brand of the Year, Youth Brand of the Year and People’s Durables Brand of the Year at the awards ceremony. This remarkable recognition reflects the deep and lasting relationship the brand has built with Sri Lankans across generations, standing as a symbol of trust in homes across the island.
Janmesh Antony, Director – Marketing said: “This award belongs to our customers. Being recognised as People’s Brand for 20 years, alongside Youth and Durables Brand, reflects our commitment to staying relevant across generations.”
Mahesh Wijewardene, Group Managing Director said: “Twenty consecutive years as the People’s Brand is humbling and inspiring. This milestone strengthens our commitment to keeping customers at the heart of everything we do.”
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