Skip to main content

Advertisement

Advertisement

As the retail sector flounders, flagship stores hope to pull in crowds

SINGAPORE — As the outlook for Singapore’s retail sector becomes increasingly challenging with rising labour costs, weak domestic and tourist demand, as well as competition from e-commerce, retailers here are spinning out new strategies to lure shoppers back to the brick-and-mortar stores. Their latest weapon of choice: The flagship store.

SINGAPORE — As the outlook for Singapore’s retail sector becomes increasingly challenging with rising labour costs, weak domestic and tourist demand, as well as competition from e-commerce, retailers here are spinning out new strategies to lure shoppers back to the brick-and-mortar stores. Their latest weapon of choice: The flagship store.

The island-wide sprouting of such stores are the outcome of retailers’ multi-pronged strategies at play, analysts said. The move allows them to take advantage of falling rentals amid the economic slowdown to secure a large space in a high-footfall area while consolidating regional or local operations under one roof.

These sprawling flagship stores aim to strengthen brand awareness by curating offerings to enhance the consumer experience and showcasing wider and newer product spreads — all in one centralised location. Consumers are enticed to spend more time, perhaps even the entire day with their families, at these mega stores instead of malls where these retailers jostle for shopper’s attention amid a plethora of brands.

“Retailers are trying to play catch-up. So we see more of them creating experiences around shopping, making it more fun and interactive. Going ahead, such flagship stores will also help retailers consolidate and rationalise store network with a keen focus on productive outlets,” said Ms Christine Li, director of research at property consultancy Cushman & Wakefield.

About a dozen flagship stores have been announced or launched in the past six to nine months. Singapore’s second-largest watch retail chain, Cortina, opened South-east Asia’s biggest Patek Philippe boutique in ION Orchard last month. Later this year, Cortina’s biggest Rolex shop in the Republic will open its doors to shoppers at Marina Square.

In January, luxury Italian fashion house Valentino opened its largest boutique in Singapore with its 3,700-sq ft outlet at Marina Bay Sands. Japanese brand Muji, which has 10 outlets in Singapore, announced in March plans to open a new flagship store of about 35,500 sq ft here featuring lifestyle concepts.

Japanese fashion retailer Uniqlo – which already has 24 outlets spread all over Singapore as well as a strong online presence – will open later this year its first global flagship store in the region. Spanning nearly 30,000 sq ft over three levels in Orchard Central, it will be the largest in Southeast Asia, said a company spokesperson, adding it will serve as “a launch-pad for Uniqlo’s LifeWear to a wider audience and showcasing concepts through innovative, high-tech displays and extensive product line-ups”.

“Flagship outlets are like anchor tenants for the mall owners that tend to be crowd-pullers. As more and more units fall vacant, mall owners will actively design deals to attract such flagship stores,” said Mr Desmond Sim, head of CBRE Research in Singapore and South-east Asia.

By the end of the year, international lingerie brand Victoria’s Secret and American fashion company Michael Kors will open their first flagship stores in Singapore at Mandarin Gallery on Orchard Road after signing leases of 10 and seven years, respectively. Amid a sluggish retail landscape, mall owners are re-looking their leasing strategies and throwing in incentives, such as extending the rent-free settling-in period and lowering rentals on longer leases. In some cases, these are as long as five times the standard three-year duration.

French sporting goods giant Decathlon, for instance, signed a lease of more than 15 years for its 35,000 sq ft flagship outlet at Viva Business Park in Chai Chee. “Such mega flagship outlets, as the one-stop-shop for all consumer needs, also complement the e-commerce strategies of retailers,” Mr Sim added.

Last December, Australian retailer Harvey Norman opened its three-storey, 100,000-sq ft flagship outlet at Millenia Walk, making it the largest electronic and household appliance department store in the Central Business District.

“Our business has to keep evolving and we need to make sure that we are always appealing to our customers. We need to bring them new experience. These three levels of floor space allow us to bring the true Harvey Norman experience to our customers,” Mr Kenneth Aruldoss, Managing Director (Singapore) at Harvey Norman told TODAY.

“Flagship stores will continue to sprout around the island as retailers up the ante by curating unique consumer experiences. Moreover, for retailers, the idea is also to refresh and re-boot in their flight-to-quality building,” said Savills Research’s Singapore senior director Alan Cheong.

Outdoor lifestyle brand Timberland opened its first Southeast Asia concept boutique last November in Raffles City Shopping Centre, where shoppers can customise their own boots by selecting lace colours and having their initials sewn on the footwear.

Luxury multi-brand footwear and accessories retailer Pedder Group opened its 20,000 sq ft Pedder on Scotts store in Scotts Square at Orchard Road last October. The concept store is the Hong Kong-based retailer’s biggest standalone outlet in Asia. Pedder on Scotts also introduced a 3,000 sq ft café run by Hong Kong’s The Coffee Academics. The 70-seat café serves coffee and brunch and also features a custom-blend bar and a training area with coffee classes.

“The quest for new experiences, coupled with the lifestyle and community components by which shoppers can hang out with friends and family, is proving to be well-received and many retailers are following this path… To distinguish from the competition online, retailers are offering such new experiences,” said Ms Anthea To, senior associate director, research & advisory at Colliers International.

Among recent new entrants to Singapore’s retail scene are Maje, a popular French womenswear label that opened its first flagship store here last October at Marina Bay Sands. Meanwhile, Japan’s Bao Bao Issey Miyake and Latvian beauty brand Stenders unveiled their flagship stores at ION Orchard and Plaza Singapura, respectively.

Read more of the latest in

Advertisement

Popular

Advertisement

Stay in the know. Anytime. Anywhere.

Subscribe to get daily news updates, insights and must reads delivered straight to your inbox.

By clicking subscribe, I agree for my personal data to be used to send me TODAY newsletters, promotional offers and for research and analysis.

Aa