Tightened Covid-19 safety rules: Hard-hit retailers fear staff layoffs, seek rental relief, govt support

• A survey by a tenants group found 86 per cent of retailers plan to close some shops and lay off staff.
• Within this group, 43 per cent plan to shut down most of their shops and lay off staff or exit the business completely
• The Singapore Retailers Association (SRA) said many members hope the Government will mandate retail stores to close
• Mall operators CapitaLand and Mercatus have said they will offer rental relief to tenants

SINGAPORE — Two days into the Phase 2 (heightened alert) Covid-19 restrictions, retailers on Monday (May 17) reported a plunge in sales, leading many to worry over how they will retain staff on their payroll and keep their businesses afloat.

Many are appealing for rent relief, which has already been offered by some mall operators. Some retailers also want the Government to mandate the closure of non-essential businesses as happened in last year’s circuit breaker, along with financial relief.

“We are still keeping our staff but do not think we can keep them for long if the situation remains like this,” said Mr Alan Lee, 47, the director of Klosh, which sells stationery, home decor, gifts and lifestyle products, with outlets at Jewel Changi Airport, Compass One and Jurong Point.

Mr Joe Chen, 40, the director of Frida, which sells ladies apparel at Novena Square told TODAY: “If the rental waiver is not given and with the current situation now, I don’t know how long my business can survive.”

TODAY spoke to more than 10 retailers, and found a similarly bleak scene from the central business district to the heartlands, with once bustling shops now largely empty.

Many retailers note that the ban on dining in at eateries has resulted in decreased walk-in traffic, and hope that the Government will announce mandatory retail closure.

During the circuit breaker in April and May last year, non-essential businesses were required to close. Rental waivers were mandated and the Government offered wage subsidies through the Job Support Scheme (JSS) to prevent large-scale job losses.

Ms Cel Oh, who owns a flower and gift shop in The Arcade at Collyer Quay, said: “With the expected decline in revenue for the next three weeks and most retailers having yet to recover much from the last circuit breaker, it's hard for us to fork out additional funds again to support the staff and pay off contractual fixed payments with no incoming revenue.”

She estimated her shop has suffered an 80 to 90 per cent drop in footfall compared to last Friday.

With no rental waivers being announced so far, she will talk to her staff of three about either getting them to go on no-pay leave or lowering their salary while placing them on a more flexible work schedule “to get through these weeks”, she said.

“In fact, a lot of food and beverage (F&B) outlets around the area have decided to just close after weighing the costs and benefits… it further reduces the footfall in the mall,” she said.

Mr Walter Tan, 57, managing director of sports and outdoor apparel retailer Outdoor Venture, said: “Occupancy cost is easily the biggest cost component apart from staffing… We hope the landlords will be more understanding as partners to react faster to our plight...”

Mr Kenny Lim Mingwen, 27, owner of Kenjo Fashion, with outlets in White Sands, Hougang Mall and Bedok Mall, agreed.

“As a small local business, we do not have deep pockets like multinational corporations. We are unable to afford paying for such high overheads with our current sales,” he said.

Ms Grace Lim, who runs Mercury Mobile, also at The Arcade, said: “Rental waivers will pull us through with one less liability to worry about as there will be no revenue… We are struggling to make ends meet.”

Klosh’s Mr Lee said that when asked for assistance, his landlords' responses have been “lukewarm”.

If landlords refuse to offer any rent reduction, one way the Government can help is to announce or enforce mandatory retail closure, he added.

RETAIL CLOSURE

The Singapore Retailers Association (SRA) president R Dhinakaran told TODAY that many of its members also hope the Government will mandate the closure of retailers.

“I have spoken to some landlords and the Ministry of Trade and Industry (MTI) requesting them to consider to close like during the circuit breaker last time because when the restaurants are not open, when the situation is so bad, people are not going to visit the malls as much, they are not going to do shopping,” said Mr Dhinakaran.

“The members are saying it is better to close so that we can get the full rental rebate and the Government will provide assistance for paying salaries through the Job Support Scheme,” he said.

He added that if the closures do not happen, he has urged landlords to consider rental rebates.

Retail tenants group Singapore Tenants United For Fairness said: “Based on the unlinked community infection data over the past days, we think it is in the better interests of both public and business health for Singapore to go into another circuit breaker so we may comprehensively and decisively head off this current challenge.”

The group also conducted a poll which showed that on the first day of Phase 2 (heightened alert), more than 81 per cent businesses across retail, F&B, services and others are experiencing a sales drop of more than 50 per cent versus the period beforehand.

“After a little more than a year of struggle since last March, small businesses cannot shoulder this kind of impact anymore and we expect significant shop closures and staff lay-offs to happen in the weeks to come.”

Survey data showed 86 per cent of businesses are planning to close some shops and lay off staff. Within this group, 43 per cent are planning to shut down most of their shops and lay off staff or exit the business completely.

“We thank the Government for the pro-active 50 per cent JSS support for the F&B sector. We would also like to point out that retail, services and other non-F&B businesses are suffering just as badly, if not worse than F&B outlets and are in dire need of similar JSS support,” the group’s spokesman added.

LANDLORDS OFFER SUPPORT

The spokesman also thanked mall operators CapitaLand and Mercatus “who have proactively offered rental relief to all their affected tenants” and called upon all landlords to “urgently follow” suit.

Responding to TODAY’s queries, a CapitaLand spokesman said: “CapitaLand stands ready to tide over Phase 2 (heightened alert) by leveraging our holistic retail ecosystem to benefit shoppers, tenants and staff.

“For retailers whose operations are directly or indirectly impacted by the latest measures, we will provide them with assistance that includes rental rebates and operational support to continue online sales through our digital platforms.”

In a statement on its website, Mercatus wrote: “For all our tenants who will be adversely impacted by the new measures and restrictions, we will be reaching out to them to provide them with the necessary rental, operational and marketing support to help them tide over this difficult time.”

Responding to TODAY’s queries, a spokesman for another commercial landlord, UOL, said: “During this period of heightened measures, we remain committed to supporting our tenants in terms of rental, marketing and operational assistance.”

In a press release, Frasers Property Retail said that it will be providing rental and operational support “in a targeted manner for F&B tenants who are adversely affected”, though there was no mention of rental support for other businesses.

TODAY has sought comment on the retailers' appeals from Enterprise Singapore and the Ministry of Law.