Singapore Retail Industry Update Quarter 2 2012

  • January 2014
  • -
  • Business Monitor International
  • -
  • 59 pages

Thanks to the robust retail revenues outlook, increasing tourism arrivals and a strengthening Singaporean dollar, the domestic consumer segment is expected to weather the global economic slowdown relatively well. We are projecting total retail revenues to grow from SGD46.19bn (US Dollar 35.53bn) in 2012 to SGD49.72bn (US Dollar 46.47bn) in 2016.
While Singapore lacks the advantage of a massive consumer base, its low unemployment rate, the rapid influx of foreign immigrants and increasing visitor arrivals will continue to instil dynamism into the local retail scene and further buoy consumer spending.
The February 2011 budget provided a boost to consumer spending power, with the SGD6.6bn (US Dollar 5.2bn) package earmarked for households in from 2011 to 2012 expected to have positive implications for the Singapore consumer. Total growth dividends of up to SGD1.5bn (US Dollar 1.2bn) will be distributed to all local adults, while individuals with lower incomes who live in public housing will get a significantly portion. For the middle class, a personal income tax rebate of 20%, capped at SGD2,000 (US Dollar 1,569), will be in place for year-of-assessment 2011 (January-December).
Singapore’s nominal Gross Domestic Product is projection to be US Dollar 291.7bn in 2012. Average annual Gross Domestic Product growth of 4.1% is predicted by BMI for the period through to 2016. With the population expected to increase from 5.3mn to 5.4mn over the projection period, Gross Domestic Product per capita is expected to rise from US Dollar 55,496 in 2012 to US Dollar 80,166 by 2016, a rise of 44.5%.
Singapore Department of Statistics’ figures show that household income from work in 2010 rose above pre-recession levels. Among resident households, median monthly income from work increased by 3.1% from SGD4,850 (US Dollar 3,804) in 2009 to SGD5,000 (US Dollar 3,921) in 2010; in real terms, the increase was 0.4%.
Tourists contribute an estimated 15% to overall retail revenues in Singapore. Visitor arrivals declined by 4.3% year-on-year (y-o-y) in 2009 to 9.7mn, with the Singapore Tourist Board stating that its previous target of 17mn visitor arrivals and SGD30bn (US Dollar 21bn) in tourism receipts in 2015 would be a challenge. However, arrivals soared during 2010. Final full-year data from the tourism board revealed that a total of 11.6mn tourists visited, a rise of 20.2% y-o-y. Q111 arrival figures were also robust, up 15.7% y-oy at 3.12mn visitors. BMI is projecting a 12% increase in tourist arrivals for FY11.
In terms of retail sub-sectors, BMI projections the over-the-counter pharmaceutical segment to be worth US Dollar 0.15bn in 2012, and for revenues to increase by nearly 40% to US Dollar 0.21bn by 2016.
Sales of consumer electronics products are expected to increase by 31.0%, from US Dollar 4.32bn in 2012 to US Dollar 5.65bn by the end of the projection period on the back of strong demand for high-end products such as multimedia notebooks, 3G phones and smartphones.
BMI food consumption data suggest that the food retail sector will have a industry share of 15.6% in 2012, when the sub-sector is projection to be worth US Dollar 5.54bn. Sales are expected to grow to US Dollar 6.91bn by 2016. Given that expansion of non-food retail is expected significantly to exceed that of the food sector, our projections suggest a reduction in the retail industry share of food to 14.9% by 2016. Per capita food consumption is still projection to be US Dollar 1,275 in 2016, which is impressive for the Asia Pacific region.
Mass grocery retail revenues are projection to be US Dollar 3.59bn in 2012 and to grow by almost 28% to US Dollar 4.59bn by 2016, higher than the rate of growth for overall food revenues . This would take mass grocery retail’s share of the overall food industry from 64.8% in 2012 to 66.4% by the end of the projection period.
Retail revenues for the BMI grouping of Asian countries in 2012 are a projection US Dollar 3.78trn. China and India are predicted to account for nearly 92% of regional retail revenues in 2012, and by 2016 their share of the regional industry is expected to be more than 92%. Growth in regional retail revenues for from 2012 to 2016 is projection by BMI at 31.2%, an annual average of 9.0%. India is set to experience the most rapid rate of growth, followed by Singapore. Singapore’s industry share of 0.9% in 2012 is projection to be at the same level in 2016.

Table Of Contents

Executive Summary . 5
Industry SWOT Analysis .... 7
Singapore Retail Business Environment SWOT ... 7
Singapore Political Environment and Risk Analysis 8
Singapore Economic Environment and Risk Analysis ... 9

Industry Analysis 10
Key Players . 11
Current Trends. 12

Market Projection Scenario ... 15
Consumer Outlook 15
Retail Growth Outlook .... 20
Data : Retail Sales Indicators ... 20
Data : Retail Sales Breakdown By Key Segment, 2012f .... 22

Macroeconomic Data . 23
Data : Singapore - Economic Activity 26
Regional Retail Outlook ... 27
Asia Pacific Retail Outlook .. 27
Data : Asia Pacific Retail Sales (US$bn), from 2009 to 2016 .. 27
Data : Asia Pacific Retail Sales By % Share, from 2009 to 2016 .. 28
Data : Asia Food Consumption (US$bn), from 2009 to 2016 .. 30
Data : Asia Pacific Macroeconomic Outlook, from 2009 to 2016 . 34

Environment Overview Outlook . 35
Asia Pacific Retail Business Environment Ratings.. 35
Data : Asia Pacific Retail Business Environment Ratings 35
Singapore’s Retail Rating .... 36
Limits Of Potential Returns .. 36
Risks To Realisation Of Returns .... 37
Mass Grocery Retail .... 38
Singapore Mass Grocery Retail Industry Environment and Risk Analysis 38

Industry Analysis .. 39
Data : Mass Grocery Retail Industry By Estimated Number Of Outlets .. 40
Data : Mass Grocery Retail Industry By Value (US$bn) .... 40
Data : Mass Grocery Retail Industry By Value (SGDbn) ... 41
Data : Estimated Average Sales Per Outlet By Format, 2010 41
Data : Sales Breakdown By Retail Format Type 41

Market Projection Scenario .. 42
Data : Mass Grocery Retail Sales - Historical Data and Projections .... 43

Industry Developments .... 44
Consumer Electronics 47
Singapore Electronics Industry Environment and Risk Analysis 47

Industry Analysis .. 48
Computers ... 48
Data : Computers Demand, from 2008 to 2016 ... 48
AV 51
Data : AV Demand, from 2008 to 2016 . 51
Handsets 54
Data : Mobile Handsets Demand, from 2008 to 2016 .... 55

Market Projection Scenario .. 57
Data : Consumer Electronics Overview, from 2008 to 2016 .... 58

Industry Developments .... 58
Automotives .. 61
Singapore Automotives SWOT .. 61

Industry Analysis .. 62
Data : Top 20 New Vehicle Registrations By Firms .... 62

Market Projection Scenario .. 63
Data : Registered Vehicles - Historical Data and Projections (CBUs) . 64

Industry Developments .... 65
BMI Methodology ... 67
How We Generate Our Market Projections ... 67
Sources .. 68

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