FairPrice launches no-frills outlets

The FairPrice Shop in Eunos is one of two - the other is in Circuit Road - which opened yesterday. Products that offer greater value will take up half the store space, compared to 20 per cent of the space in a typical FairPrice supermarket.
The FairPrice Shop in Eunos is one of two - the other is in Circuit Road - which opened yesterday. Products that offer greater value will take up half the store space, compared to 20 per cent of the space in a typical FairPrice supermarket.ST PHOTO: LIM YAOHUI

Two budget shops opened near homes of lower-income families; four more planned this year

Supermarket chain FairPrice launched a retail format aimed at budget-conscious consumers and smaller households yesterday.

FairPrice Shop, which will be located near the homes of lower-income families, features a smaller but more affordable range of products, including new FairPrice house brand Value Fresh.

The 34 fresh vegetable products in this range - which include chye sim, kai lan and long beans - are 5 per cent to 10 per cent cheaper than the chain's existing Pasar range of house brand produce.

FairPrice has opened two of these budget outlets - which are about one-tenth the size of its normal supermarkets - in Eunos and Circuit Road. It aims to add another four by the end of the year.

Potential locations are in mature estates with a higher concentration of one- to three-room flats, such as Henderson, Boon Lay, Ang Mo Kio and Jurong East.

FairPrice Shop is a "basic, no frills supermarket retail format which will focus on better catering to budget-conscious shoppers", said FairPrice chief executive Seah Kian Peng. The quality of products sold there will not be compromised despite the lower prices, he said, adding that the cheaper Value Fresh products are made possible by FairPrice taking advantage of economies of scale.

Mr Lim Boon Heng, chairman of NTUC Enterprise, said its social enterprises - which include FairPrice - keep costs low by striving to be efficient and accepting lower profit margins compared to commercial businesses. "Cost of living... will continue to be an issue. We must give assurance to Singaporeans that we have a format where they can go to and be quite sure that these are the lowest prices they can find in Singapore."

Each FairPrice Shop carries about 1,500 products, compared with 10,000 to 15,000 in supermarkets and more than 20,000 in hypermarkets.

Products that offer greater value will take up half the store space, compared to 20 per cent of the space in a typical FairPrice supermarket. These include its house brand products, Yellow Dot items - the lowest-priced items in each product category - and Every Day Low Price items, a basket of items most popular among shoppers and which are competitively priced.

While there are concerns that heartland shops may be squeezed out by FairPrice Shop, Singapore Mini Mart Association chairman Alan Tay said there is nothing that can be done about it.

"It's always been a very competitive market. We still have to do our business," he said. "That's why it's important for minimart owners to renovate their shops so that they won't look so old, and make sure items are displayed properly."

Housewife Annie Chua, 55, who was shopping at the FairPrice Shop in Eunos yesterday, said: "Other supermarkets may sell a lot more items but I don't buy most of them. The prices here are also not bad, even without offers."

A version of this article appeared in the print edition of The Straits Times on July 02, 2016, with the headline 'FairPrice launches no-frills outlets'. Print Edition | Subscribe