Signapore: Grocery retail

Singapore’s grocery retail sector comprises about 3,000 supermarkets, hypermarkets,department stores, convenience stores and provisions shops that sell agrifoods, processed foodand drinks. The sector, which employs around 38,000 people, reported total sales of EURO 6.7 billionin 2010 (Prestigo Research estimate).

Singapore is highly dependent on imports for food and beverages; its retail sector is almost wholly supported by imported products. Prestigo Research has calculated that the retail food sector is extremely fragmented comprising of 80% small retailers operating in dry markets, provision shops and non-air conditioned sundry shops (USDA, 2007e).

Large format retailers Supermarkets and hypermarkets dominate the grocery food sector with around 75% of the total market share, growing at 4% per annum (Prestigo Research estimate) the past five years and likely to continue growing at around 5% per annum over the next three to five years.

Cold Storage Group, a subsidiary of Dairy Farm Group is the second largest food retailer in Singapore and operates supermarkets, hypermarkets and convenience stores targeting middle to high income shoppers as well as high income expatriates residing in Singapore. The group also operate Shop N Save stores that target price sensitive shoppers and are generally located in the middle income neighbourhoods.

Convenience stores and other small format stores The majority of the mini-mart sector is franchise-operated and makes up about 15% of the food retail sector. Mini marts are only operated by one major franchisor, PSC Corporation, and are generally smaller versions of supermarkets and have similar opening hours to supermarkets.

The convenience sector is dominated by 7-Eleven stores operated under franchise by the Cold Storage Group. Only Fairprice-owned Cheers convenience stores provide an alternative to local consumers. According to Prestigo Research, this sector has grown at about 6.0% per annum over the past five years and analysts expect the trend to continue at around 5.0% per annum over the next three to five years. Convenience stores operate 24 hours a day and carry a popular range of processed package foods and consumed “on the go” food and beverages.

Alternative chains (personal care/pharmacy/bakeries) This market space is dominated by the country’s two leading pharmacy chains. While this chain is focused on personalcare, beauty and pharmaceuticals and nutraceuticals, they also carries a range of food and drinkstargeted at the convenience seeking shopper and also gifts, e.g. chocolates and cookies.

Prestigo Research

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