Supermarket tills are ringing and jingling

Many supermarkets reported positive sales in physical stores, which appear unaffected by online competition, which is also growing. Cooking shows on TV and social media are also increasing in popularity and this has encouraged more home cooks, expert
Many supermarkets reported positive sales in physical stores, which appear unaffected by online competition, which is also growing. Cooking shows on TV and social media are also increasing in popularity and this has encouraged more home cooks, experts say.PHOTO: TIFFANY GOH FOR THE STRAITS TIMES

Shoppers spent $2.3b at supermarts last year, twice that in 2005 and the most in a decade

People here are spending more than ever at supermarkets, despite a weaker economic climate and rising competition from online grocers.

According to preliminary government figures, purchases from brick-and-mortar supermarket stores hit $2.3 billion last year, nearly double the $1.2 billion in 2005.

This is the highest spending in a decade, which experts say may be due to higher costs of goods, an increased willingness to spend on quality and a rising interest in home cooking.

Many supermarkets The Sunday Times spoke to reported positive sales in physical stores, which seem unaffected by online competition.

Sales at FairPrice, which has 130 stores here, have risen by over 10 per cent since 2013. It said fresh foods such as milk and fish and staples like infant formula were the most popular in its stores.

Sheng Siong saw a 5.3 per cent increase over the past year. It has 40 shops.

Giant also reported "encouraging" sales at its 60 outlets. It said its consumers spent the most on essential items such as noodles and oil, citing double-digit growth for these goods under its house brands. It also saw a "strong increase" in purchases of fresh produce such as fruits, vegetables, seafood and meat.

Cold Storage, which has 46 branches, declined to comment.

Giant opened one new outlet this year, as did Sheng Siong, which has plans for two more by June. FairPrice said it has plans to open more branches in the heartlands this year.

  • ROLLING OUT MORE ORGANIC PRODUCE

  • More supermarkets here are offering organic or gourmet produce, and sales are doing well.

    NUS Business School adjunct senior lecturer Regina Yeo said that people here are better travelled and, based on the type of cuisine they are cooking, prefer to use ingredients from that country.

    Six supermarkets told The Sunday Times they either plan to start selling such products, or expand their existing offerings.

    SimplyFresh

    An online grocer that sells only fruits and vegetables that are certified as organic. Sales are growing by about 15 per cent each month.

    RedMart

    In addition to its usual items, the online grocer offers 25,000 luxury and organic food items, and sales have been "very strong".

    OpenTaste

    The newest online grocery here specialising in fresh produce, including fresh meat. Its founder, Mr David Lee, said its steaks are never frozen and are imported from America or Australia.

    FairPrice

    The supermarket sells more than 35 varieties of organic vegetables, and 1,200 organic products, including fresh produce, household and beauty items, from countries such as America and Australia.

    A spokesman said that sales of organic products have increased by 30 per cent every year since 2013, and many of its stores have a section only for organic products.

    Its FairPrice Finest stores also sell gourmet and deli foods such as strawberries and stone fruits, which are "well received" by customers.

    Giant

    The supermarket has sold organic products since 2014, and is considering expanding the variety on offer.

    Sheng Siong

    The supermarket does not currently sell organic or gourmet food, but is looking at offering a selection of organic foods "to cater to the rising demand of such foods by consumers".

The amount people spent at supermarkets has risen steadily since 2005, with last year's sales forming about 5.3 per cent of the retail sector, from 4.1 per cent a decade before, according to the Singapore Department of Statistics (Singstat).

This is despite a fall in overall retail sales during 2009 and 2010.

Singstat did not provide figures adjusted for inflation, but the cost of food has been rising over the last decade - with food inflation averaging around 1.96 per cent each year.

Even if prices go up, economist Francis Tan said groceries are something people cannot live without, so demand "remains stable despite ups and downs in the economic cycle, compared to items like jewellery and recreational goods".

Adjunct senior lecturer of marketing Regina Yeo at the National University of Singapore Business School added: "Some might sacrifice going on expensive holidays or buying luxury goods, but are less likely to sacrifice grocery shopping."

Online grocers are also cashing in, with RedMart sales doubling every six months and SimplyFresh sales increasing by 15 per cent every month, according to their spokesmen.

They said they were not threatened by new entrant OpenTaste, which began operations here last December. RedMart's spokesman said the firm welcomes the competition, as it raises awareness of online grocery shopping.

The increasing number of online grocers has also spurred supermarkets to develop their online platforms to stay competitive, offering greater varieties of items and more exclusive brands, said Ms Yeo.

All supermarkets here already offer online purchase and delivery services, with FairPrice citing 20 per cent growth each year for its online platform since it started in 2002. It added that it also plans to double the number of products available online.

Experts expect the strong sales at supermarkets to continue over the next few years.

Ms Yeo said people are choosing to dine at home as eating out becomes more expensive. Cooking shows on TV and social media are also increasing in popularity, which has encouraged more home cooks.

"As Singaporeans become more affluent, there is a tendency to buy and cook with better-quality meats and produce," she said. "Singaporeans are also better travelled and might want to buy ingredients from countries of origin, depending on the meal that they are cooking."

Two television channels here reported their food shows were doing very well. These are 72 per cent more popular than all other genres of programmes aired on The Learning Channel last year in Singapore, a spokesman said.

He added that cooking shows have been the most popular among viewers here for the past two years, and audience numbers are growing by about 35 per cent every year.

Another channel, BBC Lifestyle, said one of its most popular programmes is The Great British Bake Off, which features home bakers in a competition.

A spokesman for the channel said: "With the abundance of gourmet food shops here now, ingredients for exotic cakes became more accessible to the home baker."

NUS undergraduate Tay Chin Yee, 21, said she began baking in February after she was inspired by the BBC series. She now bakes once a week, and buys the ingredients from supermarkets.

Housewife Noor Jahan, 51, said the supermarkets near her home in Pasir Ris have begun to stock items such as bread flour, imported cream and herbs like rosemary and sage. This means she can now make more varied cuisines for her family of five.

She said: "Last time, you had to go to upscale supermarkets for such ingredients, but I can make dishes like lasagna and cheesecake mousse from scratch. There are a lot more halal ingredients than before, too."


Correction note: An earlier version of the story stated that Giant does not offer online purchase and delivery services. This is incorrect. We are sorry for the error.

A version of this article appeared in the print edition of The Sunday Times on May 01, 2016, with the headline 'Supermarket tills are ringing and jingling'. Print Edition | Subscribe