Grim outlook for Singapore retailers
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Singapore retailers are facing “dark days”, including store closures, according to Singapore real estate company CBRE.
With falling domestic demand and soaring costs, there will be more store consolidations and closures, it says in a new report.
It predicts the retail market to undergo further restructuring following a muted performance last year, with weak brands being elbowed out, reports the Singapore Business Review.
“This year will be marked by challenging conditions that could push weaker-performing brands to close or downsize.”
There will also become harder to hire staff, with the report warning it is “highly unlikely” the government will lift restrictions on hiring foreigners. However, the costs and time associated with innovation and revamp are likely to keep a lid on expansion plans.
CBRE says the fast-fashion segment will be particularly hit hard by manpower constraints and lack of suitable retail space. It says cheaper running costs in neighbouring countries have helped pull fast-fashion retailers’ attention away from Singapore.
Questions & Answers
Q.Which specific retail sector is expected to be most severely impacted by the challenges mentioned?
Which specific retail sector is expected to be most severely impacted by the challenges mentioned?
The fast-fashion segment is particularly expected to be hit hard. This is due to manpower constraints, a lack of suitable retail space, and cheaper running costs available in neighbouring countries drawing attention away from Singapore.
Q.What is preventing retailers from expanding despite the challenging market conditions?
What is preventing retailers from expanding despite the challenging market conditions?
The costs and time involved in innovation and store revamps are likely to prevent retailers from pursuing expansion plans. This means that businesses will struggle to grow, even as conditions become more difficult.
Q.What is the primary cause of the grim outlook for Singaporean retailers?
What is the primary cause of the grim outlook for Singaporean retailers?
The grim outlook is primarily caused by falling domestic demand and soaring operational costs. These factors are expected to lead to more store consolidations and closures across the retail market.
Q.Why is it becoming harder for retailers to hire staff in Singapore?
Why is it becoming harder for retailers to hire staff in Singapore?
It is becoming harder to hire staff because the government is highly unlikely to lift restrictions on hiring foreign workers. This limitation on the labour supply contributes to manpower constraints for businesses.
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