Gokongwei-led Robinsons Retail Holdings, Inc. expects to benefit from higher reciprocal tariffs between the U.S. and its trading partners, as it may eventually lead to oversupply and higher margins for dry goods.

“We think the imposition of higher U.S. tariffs on its trading partners could lead to excess manufacturing capacity, especially on non-food products, in China and Vietnam,” said RRHI President and CEO Stanley Co during the firm’s annual stockholders’ meeting.

He noted that, “The surplus in supply could eventually lead to a reduction in our inventory costs and present an opportunity to improve our margins and pricing dynamics as well as improve our offerings.”

Also, Co said tariffs’ impact on the group‘s food segment is expected to be manageable “due to our strong network of local suppliers.”

“Nevertheless, we will closely monitor these developments given the potential effect of trade disruptions on global supply chains,” he added.

Meanwhile, Co said they expect the hard discount segment in the retail grocery market to continue to post strong growth in the medium term, “as players open more stores and expand their private label portfolio.”

RRHI has a strategic investment in O!Save Trading Philippines Corporation which was founded in 2021 and already has 400 branches as of last February with the aim of having a network of 700 stores by the end of 2025.

“O!Save, a hard discounter, is a relatively new food retail concept in the Philippines. Hard discounters offer products at more affordable prices by having lean operations and offering more house brands.

“As such, hard discounters have grown quite significantly since they started operations four years ago. This momentum is also expected to be sustained over the medium term as players open more stores and expand their private label portfolio,” Co explained.

Since RRHI’s core food retail brands led by Robinsons Supermarket cater to middle- to upper-income consumers, he said “our strategic investment in O!Save has allowed us to tap into the mass market segment which we had not previously served.”