British fashion brands Topshop and Topman will close their last outlet in Singapore next Thursday and go online instead, with retail experts saying more brands might follow suit.
Yesterday, Wing Tai Retail, brand manager for Topshop and Topman here, confirmed the closure of the VivoCity outlet, and said its focus for the two brands will be online.
Topshop and Topman have been in Singapore for two decades, with the first store opening at Wisma Atria in Orchard Road in 2000.
A Wing Tai Retail spokesman said the lease of the brands' shop at VivoCity has ended and that Wing Tai will be focusing on its omni-channel retail strategy - which involves both physical and online sales channels - to better meet changing consumer preferences.
Besides Topshop and Topman, Wing Tai Retail also manages brands such as Adidas, G2000, Dorothy Perkins and Uniqlo in Singapore.
The spokesman said the closure is part of Wing Tai's business review of its brands portfolio to fine-tune its distribution strategy, adding that both brands continue to be popular in Malaysia.
Several sale signs were seen at Topshop's and Topman's VivoCity outlet yesterday, with a buy-two-get-one-free deal available for a "limited time only".
The departure of Topshop and Topman is "a symptom of the larger malaise that has afflicted many formats in the bricks and mortar retail industry", said Associate Professor Seshan Ramaswami of Singapore Management University, who specialises in marketing education.
He noted that this covers department stores, clothing stores, toy stores, bookstores and malls.
"The expiry of the lease is likely just the catalyst," he said, adding that with the likelihood of extremely slow growth for the foreseeable future due to the Covid-19 pandemic, committing to a lease renewal is probably not easy to justify.
He warned that other brands might similarly do away with a physical presence and focus on online sales.
"That strong brands like Topshop and Topman with a fairly big following in Singapore would move online is a leading indicator of the fortunes of other store brands which may have a weaker franchise," he said.
Ms Esther Ho, director of Nanyang Polytechnic's School of Business Management, said brands with only one or two outlets would not benefit from economies of scale, and that moving online might help to cut the strain on resources amid the pandemic.
"The footfall in malls has taken a hit, so it is timely for businesses to try scaling up their online sales, without concurrently suffering a drain on their resources in physical stores," she said.
However, she did not rule out the return of physical Topshop and Topman outlets post-Covid-19.
"There is a sense that having a dual presence helps to offer some visibility in the market," she said.
Prof Ramaswami said Topshop and Topman are likely to remain popular here. "That the brands are going to continue to be sold online does indicate that they are still perceived to have a sizeable audience in Singapore," he said.
In July, it was reported that Topshop was closing its last store in Hong Kong, a 14,000 sq ft, two-storey store in Central.
Like the brand's move in Singapore, Topshop products will continue to be available online for customers in the territory.