If you thought Singapore was retail paradise, a rethink may be in order.
A survey of 294 of the world's top retailers has found that just 39 per cent of them are in Singapore - a smaller percentage than in rival Asian cities Hong Kong, Beijing, Tokyo and Shanghai.
The survey, by real estate firm CB Richard Ellis (CBRE), found that 43 per cent of the retailers are in Hong Kong, 41 per cent in Beijing, and 40 per cent in both Tokyo and Shanghai.
Worldwide, London ranked first with 56 per cent of the international retail brands surveyed having a presence in the city. However, its position is increasingly being challenged by Dubai (55 per cent). The number of international retailers in Dubai rose 8.2 per cent over the last year.
Rounding out the top five are Paris with 46 per cent, New York City (44 per cent) and Hong Kong.
Singapore ranks 11th globally.
The study mapped the global footprint of retailers including luxury retailers (such as Louis Vuitton), mid-range fashion brands (Mango and Zara), specialist clothing retailers (Nike), denim retailers (Levi's and Diesel), and coffee, restaurant, supermarket and consumer electronic brands.
Dubai's No 2 position worldwide reinforces the significance of emerging markets on the global retail landscape. The CBRE report - now in its third year - reveals significant shifts from a year ago, as emerging cities such as Beijing, Shanghai and Moscow improved their positions within the top 10. Other emerging cities - Riyadh, Jeddah and Kuwait City - made the top 20 for the first time.
'While primary cities such as London and Paris continue to attract the majority of international retailers, secondary cities such as Riyadh and Kuwait are seeing a surge in new retailer openings,' said Peter Gold, head of CBRE's cross- border retail for Europe, the Middle East and Africa.
He also pointed out that the globalisation of store networks is continuing despite the challenging conditions retailers have faced in many markets.
But in Singapore, the number of international retailers fell 0.4 per cent year-on-year. The city- state's ranking dropped from eighth to 11th this year - tying with Milan and Los Angeles.
'The survey is based on a basket of brands across the major cities,' said CBRE's Singapore director of retail services Letty Lee. 'For those brands in the basket, Singapore appears to have missed out on quite a bit of opportunity in attracting retailers in the past decade with the tight (space) supply situation.
'There is, however, a lot of untapped potential in Singapore given that its retail space per capita is at 7.2 square feet - relatively lower than other cities. The other cities, with their ready and bigger catchments of affluent consumers, have been able to attract a steady stream of retailers over the years.'
Knight Frank group managing director Danny Yeo said that it is 'not surprising' that Singapore ranked lower than Hong Kong, Tokyo, Beijing and Shanghai. He pointed out that two major drawbacks for retailers were tropical Singapore's 'one-season environment' (which prevents retailers who want strong sales for their winter wear as well from setting up here) as well as the small customer base.
But he points out that the number of international retailers here has grown significantly over the past decade.
'I think in the last 10 years, we have caught up quite a bit (with Hong Kong and Tokyo),' Mr Yeo said. 'The propensity on the part of the consumer to spend has grown a lot over the last 5-10 years. We also get more tourists now.'
Despite this, Beijing and Shanghai have overtaken Singapore as their populations' ability to spend has grown very rapidly over the last few years, he said.
Mall operators here agree that Singapore needs a wider pool of global retail names and have been working hard to bring in new brands over the past few years. But there are still some notable names missing here, such as Swedish fashion retail giant H&M.
'Yes, there is still a need for a diverse retail mix and a balance of local, regional and international brands. Our local and international market is sophisticated and well-travelled and we believe our brand mix meets this need,' said Amy Lim, general manager of Orchard Road newcomer 313@somerset. The mall continues to explore new retail brands and concepts, she said.
A spokesman for CapitaMalls Asia, which has a stake in Ion Orchard, said that the property group is committed to bringing more international brands to the Republic.
Some new-to-market retail brands which have chosen Ion Orchard to be their first foray into the local scene include haute watch and jewellery brands (such as Chaumet, Boucheron, Harry Winston and Patek Philippe), luxury fashion and accessories labels (Diane von Furstenberg and Herve Leger) and high street favourites including Bershka and Christian Audigier, the spokesman pointed out.
Source: Business Times, 19 May 2010
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