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Date [ 2015-04-07, 09:29 ]
 Singapore to Lose Shopping Pull?

 

Middle Eastern investor gives his reasons.

 

(Kuala Lumpur=Korean Press)  Lui Lai Keen = Singapore has long made a name for itself as a premium shopping  centre, Chock full of designer labels and in trend with the fashion capitals of the world. But a warning bell has been rung by leading retailer.

 

Kesri Kapur, Head of Business Asia,  Al-Futtaim Group manages brands such as Robinsons, John Little and Marks & Spencer. According to him, the island state has far too many shopping malls. Worse – they are all alike and are not viable if you are in the retail business. And this Dubai-based conglomerate should know as it has more than 20,000 staff across more than 15 countries.

 

Despite having a wealth of experience in the shopping sector. Al-Futtaim was one of the first to be hit by the bane of retailers – staff shortage. Also rentals are continuing to rise. Based on these factors, the Group announced in the first week of March that it will close two John Little stores based in Marina Square and Tiong Bahru, and a Marks & Spencer outlet at Centrepoint in the coming months.

 

In an interview with Today, Kapur said, “There is not enough differentiation in the stores. For such a small market, if it’s to be viable in the longer-term and sustainable, there has to be some differentiation (among) the stores.” The bottom line is that there are just not enough shoppers.

 

The Group feels the closures of its stores are a sad necessity but it would allow the consolidation of its resources. The good news is that none of the affected employees will be axed. They will instead be deployed to the remaining stores or given the option to take up other positions within Al-Futtaim.

 

Another factor for the closing of the stores is rising business costs. Add to this new shopping habits and it is inevitable the Group had to rethink its strategies. Kapur mentioned how today’s younger shoppers seem to prefer to go on-line for their shopping. Gone are the days when customers would walk into a store and do their buying. “Nowadays they  are also becoming more knowledgeable and make their final choice after doing more research,” the Head of Business revealed. Read that  as surfing the net.

 

What was also noted was that shoppers do not now have to come to the city centre to do so. Classy shopping malls are now even sprouting in suburban areas. such as Jurong East. Orchard Road is beginning to lose its monopoly as the place to shop!

 

Kapur intends to fight back with high quality improvement of service and widening the base of its product s. Shoppers will have more choices now. When a house is beginning to look dowdy, repaint and/or refurbish it. Slated for a new look, some of the stores, including those in Robinsons Raffles City and the Marks & Spencer outlets at Paragon and Raffles City await renovation. A touch of glamour will happen when the new Zara boutique at Changi Airport Terminal 3 opens next month in May. 

 

In line with the Singapore government’s intention to increase ecommerce, Al-Futtaim too will be moving  into  it. It strongly feels by the end of this year, consumers would have the option of buying goods online from its stores.

 

Kapur made the observation that Singapore’s position as a top shopping destination is under bombardment from its regional  neighbours. Their rising  population with increased spending power is growing fast. The end result, many major brands that used to be based in Singapore only have also set up shop in places such as Bangkok, Kuala Lumpur and Jakarta.

.

Nevertheless, Singapore scores by remaining one of the better places to shop in a clean and safe environment. “It’s also convenient and accessible, so Singapore still has some advantages. Kapur also believes the perception that Singapore is an expensive place to shop will change in time. This could be due to the fact that the  Singapore dollar has slid down against the US dollar.”

 

The good thing about this is, one way or another, it is the shopper that tends to gain. abc@koreanpress.net

 

 

 

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