George at Asda opened its first store in South East Asia in Singapore today (Tuesday). Retail Week examines the retail market there.
Singaporeans love to shop. According to Planet Retail research director Malcolm Pinkerton, they are “avid consumers, shopping frequently and treating it as a leisure activity”. The affluent island has “high levels of household expenditure”, he says. Total retail sales hit US$39.24bn in 2012 and are expected to rise to close to US$41bn this year.
As well as attracting tourists from all over the world, often on business and stopping off between international flights, Singapore is also a popular retail destination among consumers across Asia.
The country has attracted many international brands, particularly at the luxury end, which seek to appeal to Singapore’s large numbers of tourists. However, the country also has a strong domestic retail market, with grocers including NTUC FairPrice and Sheng Siong among the market leaders, according to Pinkerton.
There is strong demand for British brands in Singapore, says Pinkerton. Topshop, Marks & Spencer and Mothercare already operate stores in the country. Among overseas brands, H&M, Toys R Us and Uniqlo have a presence in the country.
Singapore is a good springboard for further Asian expansion. Retailers often find it easier to open there compared to its Asian neighbours, due to its more westernised culture and its liberal business and investment policies. In India, for example, there are restrictions on how foreign retailers can enter the market.
Singapore boasts “huge” amounts of prime retail space according to Pinkerton. “There are huge shopping centres and malls plus a steady stream of tourists,” he says.
The economy is robust, and is forecast to grow by between 1 and 3% this year. Unemployment is low at 2% and wholesale and retail sales are expected to rise 2% for 2013. Singapore has a population of 5.3 million.
(Source: Retail Week)