Mothercare still thriving in Singapore despite UK woes

Retailer puts loss-making British business into administration

A Mothercare outlet in north London. The Guardian reported that the retailer had failed to find a buyer for the British operations but stores will stay open until administrators have been appointed and the business wound down. PHOTO: AGENCE FRANCE-PR
A Mothercare outlet in north London. The Guardian reported that the retailer had failed to find a buyer for the British operations but stores will stay open until administrators have been appointed and the business wound down. PHOTO: AGENCE FRANCE-PRESSE

Baby product retailer Mothercare said its 11 stores here are thriving, despite the group's announcement yesterday that it is putting its loss-making British business into administration.

Singapore managing director Pang Fu Wei told The Straits Times that the franchise that manages stores in Singapore, Malaysia and Hong Kong has more strings to its bow than basic retail.

He noted that it also distributes products to other chains and online marketplaces: "I think the biggest difference between us and the United Kingdom operation is that we're not just a retailer."

While the brand's international business is profitable, with more than 1,000 stores in over 40 territories, retail operations in Britain - where the firm is based - lost £36.3 million (S$63.6 million) in the last financial year, Reuters reported yesterday.

Sales have been battered by intense competition from supermarket groups and online retailers as well as by rising costs, it said.

The group will appoint administrators to its British business, putting about 2,500 jobs at risk.

It added that the administration filing was a necessary step in restructuring and refinancing the group, given its 79 stores in Britain were not capable of returning to a level of sustainable profitability.

The Guardian reported that Mothercare had failed to find a buyer for the British operations but stores will stay open until administrators have been appointed and the business wound down.

It is a different story here, with the 10,000 sq ft Mothercare store in HarbourFront relaunching last month after a revamp to add experience zones and new services. Another will open at Northpoint City mall in Yishun by the end of the month.

The "experience store" at HarbourFront is a world-first for Mothercare, said Mr Pang. It has seven zones where customers can try out products, like a stroller test area that includes model plane overhead cabins to check for size compatibility.

The store has also introduced services such as a nursery adviser to guide first-time parents and free monthly stroller and car seat cleaning services for VIP members.

The changes are a "direct response to the online threat", Mr Pang said, adding: "Online will always be cheaper. There are so many online players and there are always promotions."

Mothercare is trying to transform into a business that is service-driven rather than focused on individual products, he added.

The strategy to drive footfall to its stores appears to be working - sales are up nearly 10 per cent from the previous month.

The features that prove most popular will be introduced to other stores here as well as in Malaysia and Hong Kong, said Mr Pang. "We're taking things online can never do and pushing it as far as we can. If you don't have deep engagement with consumers, they're always going to go with the lowest price," he added.

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A version of this article appeared in the print edition of The Straits Times on November 05, 2019, with the headline Mothercare still thriving in Singapore despite UK woes. Subscribe