SINGAPORE - After 162 years, department store stalwart Robinsons is throwing in the towel. It said on Friday (Oct 30) it is closing its last two department stores here at The Heeren and Raffles City Shopping Centre.
The retailer said the decision to liquidate its stores was prompted by a range of factors, including changing consumer tastes and cost pressures such as rent.
"The overarching business model of department stores is outdated," it said in a statement.
Robinsons also said decision to liquidate came after the stores' "inability to continue operations due to weak demand at department stores".
While the retailer's e-commerce platforms are no longer operational, shoppers can continue to visit its bricks-and-mortar stores for the time being.
The last day for the two physical stores is not clear. Robinsons said the appointed liquidators are in negotiations with the landlords but "we hope that the stores will stay open for the coming weeks".
Robinsons stores in Malaysia, located at Shoppes at Four Seasons Place and The Gardens Mall, will also be liquidated.
But other retailers under the Al-Futtaim Group, which include Marks & Spencer and Zara, will not be affected, a spokesman has confirmed.
Mr Danny Lim, Robinsons' senior general manager, said: "We regret this outcome today. Despite recent challenges in the industry, the Robinsons team continued to pursue the success of the brand.
"However, the changing consumer landscape makes it difficult for us to succeed over the long term and the Covid-19 pandemic has further exacerbated our challenges.
"We have enjoyed success over the years, and it has been an honour for Robinsons to serve the Singapore market. I am grateful for the dedication of our team, and for the support shown by our customers over the years."
Robinsons said changing retail trends brought about by the rise of e-commerce and lower demand for department stores are to blame for slumping retail sales, a problem that has been exacerbated by the coronavirus pandemic.
Robinsons was bought by the Dubai-based Al-Futtaim Group in 2008 for $600 million.
In 2016, the Al-Futtaim group, which owns Robinsons and other franchises such as John Little and Bebe, announced that it would be closing 10 or more stores in Singapore, citing the challenging retail environment.
Robinsons suffered losses for at least the last six years from shrinking sales, The Business Times reported.
In 2018, the chain sank $54.4 million into the red after revenue fell to $153.8 million. In comparison, turnover was $257.3 million in 2014.
Its Raffles City store opened its doors in 2001 and the retailer later opened its flagship store at The Heeren in 2013, occupying six floors and 186,000 sq feet.
Then in 2016, Robinsons launched its first e-commerce website and also closed the last John Little outlet in Plaza Singapura at the end of the same year.
In the third quarter of this year, Robinsons closed its Jem outlet in Jurong East, which had opened in 2013.
Following Robinsons' announcement on Friday, OCBC Bank said it is cancelling its OCBC Robinsons Credit Card from April 15 next year.
Mr Vincent Tan, head of cards business at OCBC, said: "We are grateful to have been able to partner Robinsons in a successful co-branded credit card platform in Singapore over the past 18 years."
Robinsons also encouraged all customers holding on to Robinsons gift cards and vouchers to redeem them as soon as possible.
"The stores in Singapore will accept Robinsons...gift cards and vouchers during the liquidation process and for as long as the stores remain open," it said.
Customers at Robinsons stores here were also told on Friday that vouchers can be used only for purchases at least double the value of the vouchers. This means that a $20 voucher, for example, can be used only with a minimum spend of $40.
Corporate advisory and restructuring firm KordaMentha's Mr Cameron Duncan and Mr David Kim have been appointed provisional liquidators, said Robinsons on Friday.
The provisional liquidators will now take control of the company's assets and assess options to realise value in order to maximise returns to creditors.
"Subject to confirmation, the liquidators are hoping the stores will remain open for the coming weeks to facilitate final sales for customers before they are shuttered," Robinsons added in the statement.
The retailer said that its employees were informed on Friday by management and the provisional liquidators of the liquidation, adding that they have been assured that the liquidators will now work to maximise returns to creditors, including employees.
The company employs 175 staff here.
Robinsons said its management has ensured that employees are supported with payments in keeping with the Insolvency, Restructuring and Dissolution Act. They will be made to workers in the next payment cycle.
"(This) is well in advance of the usual liquidation process timing which would usually take months," the company added.
The payments will be on top of employees' salaries, which will be paid in full in line with the number of hours worked, said Robinsons.
"All store operations staff under Robinsons Singapore and Malaysia will remain in the employment of Robinsons until further notice," the company said.
"Any staff movement will depend on the circumstances. We are doing our best to see how we can accommodate Robinsons staff in other brands."
KordaMentha will now aim to work with the Singapore Manual and Mercantile Workers' Union, the National Trades Union Congress' Employment and Employability Institute and the NTUC Job Security Council to ensure that employees are supported.
The liquidators will also leverage existing government schemes such as SkillsFuture Singapore's SGUnited Jobs and Skills Package.
For the liquidation of Robinsons' two stores in Malaysia, Datuk Robert Teo Keng Tuan of RSM Malaysia was appointed on Friday as interim liquidator.
When contacted, Raffles City Singapore said it is in discussions with Robinsons on the smooth handover of the premises.
"Shoppers can look forward to a refreshed Raffles City tenant mix with the introduction of exciting offerings. More details will be shared in due course," it added.
Some shoppers like housewife Suyan Hong, 48, were "totally stunned" when told that Robinsons was in provisional liquidation.
"I knew that they were downsizing after they announced the closure of their (Jem) outlet. But usually when downsizing happens it's a cost-cutting measure that will help the business' margins improve. I didn't expect them to shut down," she said.
Ms Hong said that the department store introduced her to brands such as Jigsaw, Whistle and Trucco which she frequently buys from.
"I will miss the spontaneous experience of being able to find anything from clothes, homeware and children's items in one place at Robinsons," she said. "Robinsons is where I would go for last-minute shopping during the holiday season."