Singapore is seeing one of its worst retail slumps ever, with recent takings at the till registering their sharpest drop in nearly 22 years.
But the plunge in March is only the tip of the iceberg, with experts expecting retail businesses to be hit even harder by the circuit breaker measures last month and this month.
Retail sales in March dropped 13.3 per cent compared with the same period last year, according to data released yesterday by the Singapore Department of Statistics.
This was the worst drop since September 1998.
Most retail categories registered a double-digit decline in sales, as the coronavirus outbreak impacted consumer sentiment.
But supermarket sales saw a huge boost, as people stocked up on groceries and household items.
Experts fear the slump could worsen.
Maybank Kim Eng economist Lee Ju Ye said: "The decline in April and May will likely be far worse due to the circuit breaker measures, and also because consumers are now avoiding expenditure on discretionary items such as watches and jewellery... as the economy enters a recession and the labour market worsens."
She added that based on Google mobility reports, the movement of people to retail and recreation venues plunged by 70 per cent as of April 26, compared with the first two months of this year.
She noted: "We will likely see the pace of decline for retail sales steepen to beyond minus 20 per cent in April and May. As a comparison, the steepest decline during the global financial crisis was around minus 12 per cent."
Some high-profile retailers are already feeling the pinch.
Singapore-based sofa maker HTL has filed for insolvency protection, citing a cash-flow crunch as a result of the pandemic. HTL is a leading manufacturer with over 5,000 employees worldwide, and experts fear that it may not be the only one to run into problems.
OCBC Bank's head of treasury research and strategy Selena Ling said: "Only those (businesses) with holding power, namely big cash reserves, financing access, customer loyalty and savvy at navigating the digital transformation will survive."
In March, apparel and footwear sales saw the largest drop, at 41.6 per cent, while the sales of food and alcohol also declined, by 41 per cent.
Department stores registered a drop in takings of 38.6 per cent and sellers of watches and jewellery also felt the hit, with sales decreasing 34.4 per cent.
These segments were impacted by the decline in tourism receipts, said the Department of Statistics.
Other categories that saw sales sliding included motor vehicles; optical goods and books; cosmetics, toiletries and medical goods; and recreational products.
But sales at supermarkets and hypermarkets jumped 35.9 per cent, while minimarts and convenience stores saw takings increase by 4.7 per cent, due to higher demand for groceries.
Sales of furniture and household equipment, as well as computer and telecommunications goods, also went up as people had to work and study from home.
This also accounted for the rise in online sales. The estimated total retail sales value in March came to $3.3 billion. Of this, online retail sales made up an estimated 8.5 per cent.
United Overseas Bank economist Barnabas Gan said: "The decline in tourism arrivals and spending is a likely scenario for the remainder of the first half of the year, which will further depress Singapore's retail sales growth.
"High-frequency data already indicates that the fall in tourism has already outpaced that of the Sars outbreak in 2003."