Understaffed retailers steeling themselves for year-end peak shopping season

Retailers are bracing themselves for crunch time - the year-end peak shopping season - because they are having trouble manning their stores adequately and they know that service levels are not where they once were. -- ST FILE PHOTO: NURIA LING
Retailers are bracing themselves for crunch time - the year-end peak shopping season - because they are having trouble manning their stores adequately and they know that service levels are not where they once were. -- ST FILE PHOTO: NURIA LING

Welcome to shopping paradise Singapore, where customers say they have trouble getting service and shop owners say, "Sorry, we do not have enough staff."

Retailers told The Sunday Times that they are bracing themselves for crunch time - the year-end peak shopping season - because they are having trouble manning their stores adequately and they know that service levels are not where they once were.

They point to tighter foreign labour rules and the continued difficulty of hiring Singaporeans for sales jobs.

The foreign worker quota fell from 50 per cent to 45 per cent in July last year to the current 40 per cent after the Manpower Ministry's latest revision this July.

While companies can hold on to existing employees up to the previous limit until 2015, they cannot hire new foreigners if that would push them over the quota. So some firms have not been able to replace the foreigners who have left.

Given shift work, and shops staying open on weekends and public holidays, they say hiring Singaporeans and permanent residents is an ongoing challenge.

The retailers interviewed said they know it will be hard to keep customers happy in understaffed stores.

Mr Andy Chaw, founder and chief executive of Star360, a sportswear retailer, said his workforce has shrunk by a quarter over the past year.

"We had foreign workers whose contracts expired and we don't have the quota to replace them," he said.

Offering more pay has not helped him attract staff.

"We tried online and offline recruiting, and offering more perks like better commission schemes, and we actually raised the pay package, but we still find it difficult to recruit people," said Mr Chaw.

The shortage has hit efforts to maintain service quality standards too. "Even the training we used to have for service staff has been shortened as we have to put them on the floor quickly," he said.

Retail giants such as Isetan are feeling the pinch too. "We are below our ideal numbers by about 10 per cent," said a spokesman.

Mr R. Dhinakaran, managing director of Jay Gee Melwani Group, which distributes fashion brands such as Levi's and runs health supplement chain Holland & Barrett, said his outlets are strapped too.

There used to be a minimum of three salespeople at the 25 Holland & Barrett outlets. Now, there are two or even just one, said Mr Dhinakaran, who is vice-president of the Singapore Retailers Association.

"We are exploring many possibilities, like opening the shops only at the right hours of the day when the business is better," he added.

He warned that slipping service standards could affect Singapore's reputation. "If we lose this edge over other countries, we will lose our overall identity as a tourism hub," he said.

A spokesman for the Robinsons and Royal Sporting House Group, which includes popular chains such as Marks & Spencer and John Little, said the foreign worker quota would have "a huge impact on driving up cost, if we were to meet the manpower required to maintain standards".

Spring Singapore, which looks at ways to grow local businesses, believes retailers need to automate more to boost productivity and reduce their reliance on labour. It said it has been encouraging companies to "streamline their work processes, adopt technology as well as develop their human resources".

But retailers say they need people to sort and shelve merchandise, iron clothes and deal with customers.

"At every touchpoint, you still need a human to do all these things," said Orchard Road Business Association executive director Steven Goh.

"Our retailers are saying they would like more information on exactly which parts of the processes they can automate."

In the meantime, part-time workers and interns from polytechnics and universities have provided some respite for the fashion and lifestyle industries, said Mr Goh.

Isetan also said it is recruiting more part-timers and older people.