Singapore: Lockdown may be better than current ‘zombie’ situation: SGTUFF

• May 17, 2021

RETAIL tenant group Singapore Tenants United For Fairness (SGTUFF) on Monday said that it may be better for the public and businesses if Singapore enters another partial lockdown, that is, another ‘circuit breaker’,  instead of having the government progressively tighten measures to curb the resurgence of Covid-19.

The group noted that under the tightened movement restrictions, the shopping malls are remaining open, but with curtailed occupancy limits. This has turned the malls into ghost towns. Of retailers who have experienced a decline in sales, 45 per cent have seen their sales drop by at least 80 per cent; 36 per cent have seen sales drop by 50-80 per cent. 

Among the latest restrictions which will be in place till June 13, dining out has been banned, but food and beverage (F&B) operators are to receive increased wage support under the Jobs Support Scheme (JSS) for this period. 

Said a spokesperson for SGTUFF: “With infections going up, we think it’s more straightforward for us to go into CB (‘circuit breaker’) instead of facing the current zombie situation for non-F&B businesses. Many members in retail and other non-F&B services are also facing severe business drops like those in the F&B sector, but they have not been offered the 50 per cent JSS help or rental reliefs yet.” 

SGTUFF, which has more than 700 members as at last November, polled about 150 of them. More than eight in 10 saw their sales more than halve as the latest round of tightened measures took effect on Sunday. 

Joel Lim, managing director of water purifer retailer Ruhens, for example, noted that the current restrictions on business operations are similar to those of last year’s ‘circuit breaker’, with the main difference being that rental rebates and higher JSS support were extended to the retail industry last year.  

The latest restrictions may force the hand of retailers that have yet to recover from the impact of the pandemic last year, said SGTUFF. Some 86 per cent of members polled have said they are planning to close “some shops” and lay off staff. And of those, 43 per cent plan to shut “most of their shops” and lay off staff, or exit the business completely.

“After a little more than a year of struggle since last March, small businesses cannot shoulder this kind of impact any more and we expect significant shop closures and staff layoffs to happen in the weeks to come,” the spokesperson said.

Still, a few retailers said they prefer to keep their shops open despite the fall in traffic, because a full lockdown would hit livelihoods severely.

But most retailers told BT that the “shopping mood” has evaporated from retail spaces, since consumers are heading straight home after buying food instead of lingering after dining in.

Jamie Lim, chief executive of furniture retailer Scanteak Singapore, said that while she is glad people are doing their part to stem the spread of the virus by staying home, it is depressing to see employees looking “listless, bored and demoralised” in the stores.

“On one hand, many retailers hope to drive up their sales to cover our rentals and overheads. However, we are also stuck in a rut because if we drive sales to survive, it goes against the very essence of what we are trying to do.” For instance, activities that draw shoppers to stores would defeat the purpose of limiting crowds to stem the virus spread.

She hopes ways will be found to keep retail sustainable, whether through ‘circuit-breaker’ measures that could result in similar levels of support given during the first one, or more assistance to help firms weather the period.

KENJO Fashion founder Kenny Lim said retailers might benefit from a ‘circuit breaker’, because they are not currently receiving the same support as F&B businesses despite being significantly impacted. “Logically speaking, are retailers’ business less hit than F&B? People still need to eat, whether it’s a ‘circuit breaker’ or not. But retailers of clothing and accessories are deemed non-essential as people currently are all in money-saving mode and only buying essential items,” he said.

Among those still keen to keep their retail stores open, rather than being forced to shut them in a ‘circuit breaker’, is Wilson Chew, managing director of smart blinds retailer mc.2. He said a full lockdown would have a big impact on businesses and livelihoods especially in the home improvement industry, as they would not be able to fulfill their sales cycles.

Said Ruhens’ Mr Lim: “I think Singapore should maintain its present stance, as this gives us a balance of sustaining the economy as well as trying to curb the spread of Covid-19.”

Separately, the Singapore Retailers Association (SRA) on Monday wrote to Trade and Industry Minister Gan Kim Yong, seeking support measures for the industry, noting that the new restrictions have already had “immediate and adverse impact on sales for retailers”.

“Although well-intended, allowing retail businesses to open for business…served only to increase retailers’ operating costs as there are no sales to be made with malls eerily quiet and void of shopper traffic,” SRA president R Dhinakaran said in the letter. “Even suburban malls usually seen as more resilient are not spared.”

Among the support sought, the association has asked the government to extend a property tax rebate of at least one month directly to retailers, using the rental relief framework passed in Parliament in June last year as a guide.

It has also asked for the increased wage support to be extended to retailers, and for a further six months till year-end to “help retailers recover faster and mitigate job loss”.

SRA also seeks enforcement on landlords to apply a percentage-only rent model, capped at 15 per cent of the retailer’s gross turnover. 

On vaccinations, the association asked that the government advance vaccinations – “preferably within the next two months, if not earlier” – for the retail workforce, which is estimated at 140,000, especially those who are consumer facing. 

Source: https://www.businesstimes.com.sg/sme/lockdown-may-be-better-than-current-zombie-situation-sgtuff