FairPrice’s house-brand range levels up, generating close to $1b in revenue in 2024

SINGAPORE – Before a new product, such as a seasonal variation of the popular FairPrice potato chips in bak kwa or tomato hotpot flavour, is added to shelves, it has to be tasted by Ms Grace Chua.

Whether it is an olive oil developed with a lower smoking point that is more suited to Asian cooking, or a non-food item like two-ply facial tissues, the chief executive of FairPrice Group’s (FPG) Own Brands & Food Solutions division has the ultimate say.

Ms Chua is responsible for signing off on every product added to FPG’s range of house-brand products, which already number more than 3,500.

The range, which was expected to double its revenue to $1 billion in 2030 from $500 million in 2022, was within striking distance of this target in 2024, six years ahead of schedule.

Close to $1 billion, or 20 per cent of FPG’s sales in 2024, came from its portfolio of Own Brands – including its eponymous house brand, and labels such as Pasar, Golden Chef and Delicato.

The range, which now comprises more than 3,500 products in more than 70 categories, is sourced from more than 50 countries, including Malaysia, Thailand, South Korea, Norway and Singapore.

These items – from essentials like rice, cooking oil and toilet paper to indulgences like flavoured nuts and potato chips – are typically 10 per cent to 15 per cent cheaper than branded alternatives. They have proven to be popular with price-conscious consumers in Singapore.

House-brand goods a staple of consumers’ baskets

With cost-of-living concerns never far from consumers’ minds, data shows that house brands have become a staple part of purchases.

In 2024, 95 per cent of grocery shoppers bought house brands, according to a Nielsen survey. It also revealed that 33 per cent of shoppers said they were tapping more house brands, up from 27 per cent in 2021.

Other supermarkets and online retailers such as Sheng Siong and RedMart also have their house brands and private labels. DFI Retail Group, which runs Giant and Cold Storage supermarkets, has the Meadows range and Giant brand, for example.

For FPG, consumers’ shift towards actively purchasing house brands has been gradual but steady, picking up steam in recent years, said Ms Chua.

The group has launched an average of more than 100 new products every year since 2019, when the dedicated business unit was set up to grow its house brand offerings.

“Five to 10 years ago, a lot of the bestsellers were the daily essentials like rice and oil, and this is how customers are typically first introduced to Own Brands,” Ms Chua told The Straits Times.

“But if you fast-forward to today, it’s a good mix of customers buying both essentials and indulgence products, like snacks and ready-to-eat meals, which shows that the consumer is ready to go beyond the basics and expand the categories of house-brand items they are purchasing.”

As at 2024, FPG said, one in three products in shopping baskets at its retail stores is an Own Brands item, while seven in 10 online baskets contain an Own Brands offering. Nearly one in two shoppers who check out of the chain’s 164 supermarkets and online channels opt for an Own Brands product.

Value-conscious consumers seeking quality

Experts and industry observers attribute the rise in popularity of house brands to consumers seeking value. The improved quality has also been a game changer.

“Consumers are more price-conscious and seek value, and house brands or private labels offer comparable quality at a lower price point, making them a logical choice for many shoppers,” said Ms Felicia Wee, course chair for the diploma in marketing at Temasek Polytechnic.

Marketing associate professor Lau Kong Cheen of the Singapore University of Social Sciences noted that such products are also a natural choice for those seeking to reduce household expenditure.

Ms Wee said house brands “were once perceived to be a budget option; however, now (they’re) often seen as a smart and value-conscious choice”.

“Supermarkets have invested in product development to ensure that their house brands match or even surpass other local or international brands in quality, with well-designed packaging and branding also enhancing consumer trust,” said Ms Wee.

Dr Lau noted that many supermarkets now source products from reputable suppliers, some of which are also behind mainstream brands.

Coupled with visually appealing packaging, he said, this has “moved consumers away from the perception that house brands are merely no-frills and low-cost alternatives”.

“The main brand message emphasises value and affordability, which resonates well with general consumers,” he added. “As a result, consumers feel a greater sense of self-respect, recognising that choosing a budget-friendly option does not mean compromising on quality, but rather making a smart and value-conscious decision.”

Ms Chua said data also shows that buyers of the Own Brands range cut across income classes, “since there are no trade-offs on quality any more”.

Besides going further upstream and working directly with manufacturers to ensure higher quality, FPG has also gone into vertical integration – where a business controls the supply chain and multiple stages of the production process, to eliminate or reduce dependency on third-party vendors.

FPG acquired a majority stake in OJJ Foods – one of the largest processors and distributors of chilled and frozen pork in Singapore – in 2022.

Ms Chua said: “In important categories such as protein, we’ve gone into upstream sourcing and vertical integration to allow us to balance supply resilience, because we’re closer to the source and can ensure a stable supply, as well as drive cost efficiencies, so that we can price our products affordably for the consumer.”

From bak kwa-flavoured chips to infant formula

Delivering an affordable but high-quality product also calls for innovation, and keeping up with what consumers want, added Ms Chua.

Product innovation is constant, with a pipeline of new products lined up for the next 24 months.

“The Government wants to also support a lot of our young families, so we have expanded our range into infant and baby products,” Ms Chua said.

For example, the Own Brands line has FairPrice Gold – an infant formula sourced from Australia with similar nutritional properties as branded alternatives. Checks by ST show it retailing at 50 per cent less than some branded alternatives.

Such forays are yielding impressive results, with some offerings even outmuscling branded rivals in sales. FairPrice’s Own Brands potato chips outperform leading commercial brands in all its stores. 

About 20 per cent of products now on shelves at FairPrice stores are from house brands.

For example, half of the paper products, such as tissue paper, toilet paper and kitchen towels, are from FPG’s brands.

Consumer intelligence firm NielsenIQ’s 2025 mid-year consumer outlook guide shows that Singapore’s market share of consumer packaged goods growth attributed to private labels outpaced that of Thailand, South Korea, Taiwan and Malaysia.

Ms Chua said FPG is aiming to hit the global benchmark of 30 per cent penetration, putting it within range of retailers like Coles in Australia, Walmart in the United States and Tesco in Britain.

“FPG’s Own Brands adoption is already one of the highest in Asia, but there’s still a lot of room to grow... We want to be the best in class globally,” she added.

“But our biggest priority continues to be strongly anchored on giving the best value for money to Singapore households.”