Sales at department stores slump in June despite GSS; Car sales spike

SINGAPORE – Retail sales at department stores tumbled 7.3 per cent in June compared to the previous month, despite the Great Singapore Sale (GSS) campaign.

Figures released on Friday (Aug 10) by the Department of Statistics Singapore also showed year-on-year sales for department stores ended 1.9 per cent lower than in June last year.

Food retailers, supermarkets, furniture and household equipment sellers, optical goods, and books vendors also showed poor performances in June, compared to the previous month, as well as the same period last year.

In contrast, car sales saw a significant jump for the month of June, increasing a whopping 16.5 per cent from the previous month, and 9.7 per cent compared to the same period last year.

This was likely due to the increased demand for new cars following the decline in Certificate of Entitlement (COE) premiums in June. At the first bidding exercise, the COE premiums for small cars closed 4 per cent lower from the previous exercise, and the second bidding exercise saw COE premiums for big and small cars fall to an 8-year low.

The strong sales of motor vehicles held up the overall retail sales figures for June, which ended 2 per cent higher at S$3.9 billion compared to the same period last year. On a month-on-month comparison, overall retail sales was also up 1.2 per cent.

Besides competition from e-commerce, retail experts say another factor for the decline in department store sales is that the GSS is no longer attractive for local shoppers and tourists.

Citing an example of a Nike shop in the United States that has a basketball court for customers to play on while trying their shoes, senior tourism lecturer at Ngee Ann Polytechnic Mr Michael Chiam said retailers need to provide such experiential elements throughout the year to draw customers.

There needs to be a consistent effort in “evolving our retail model to be something experiential”, he added. This could mean there may no longer be a need for GSS.

Mr Chiam noted that there is “nothing special” about GSS as retailers are already holding sales throughout the year. On top of that, Singapore’s neighbours, such as Malaysia and Hong Kong, also have similar events.

Believing that it has “lost its novelty”, Associate Professor Thompson Teo from National University of Singapore (NUS) Business School said there has been no “significant change” to the sales campaign through the years.

GSS was first held in 1994.

In June, TODAY had reported on the lukewarm reception of the GSS as it has remained stuck in time and has not evolved along with changes in consumer trends.

Both brick-and-mortar and online retailers said other major sales campaign, such as Black Friday and Singles Day, are becoming more popular than the GSS and are major contributors to their overall sales.

"The whole retail industry is in flux right now. They are just doing the basics (of) selling products. That’s all,” Mr Chiam noted.  

“Customers are looking for more," added Assoc Prof Teo.