Convenience Stores in Singapore

PROSPECTS

Convenience stores remain in backseat as supermarkets continue to drive

Sales growth for convenience stores in Singapore has taken a hit over the years due to a combination of various factors, both hard and soft. Although the Singaporean economy has generally recovered in 2018, spill over effects from the sluggish economy in the last few years can still be seen today as weak consumer sentiment and wariness prevail.

Efforts to offer value added services keep convenience stores afloat for now

With massive competition from supermarkets, convenience stores have been forced to prominently differentiate themselves in order to stay put in Singapore’s retailing landscape. One notable effort is the provision of fresher food and more attractive takeaway options.

Embracing of technology to attract modern consumers

Another attempt by convenience stores to raise their game is the leveraging of technology to implement in-store services like self-service and bill-payment kiosks. In addition to combating the man-power crunch, these value-added technology services also offer cashless payment options that support the government’s cashless drive to facilitate consumer transactions.

COMPETITIVE LANDSCAPE

Ready-to-eat meals keep 7-Eleven on top

7-Eleven continues to dominate convenience stores, not only due to its significantly higher number of outlets compared to Cheers, but also its successful revamping of stores to include fresher ready-to-eat meals. By leveraging its pre-existing relationship with 7-Eleven Japan, which is known for efficiently listening to customers, 7-Eleven Singapore has incorporated unique Japanese products and private label ranges into its offerings.

Cheers introduces comparable initiatives but still lags behind 7-Eleven

While 7-Eleven continues to dominate and is investing in value-added services to differentiate itself, efforts by Cheers are similar and cannot be dismissed. Jumping on the ready-to-eat meals bandwagon, Cheers is providing further convenience by offering items like nasi lemak and beef rendang baked rice, which are preservative-free and do not need to be thawed before hearing up, thus saving time.

Growing competition from new convenient supermarket formats

Despite these efforts, Cheers does not capture a large part of sales share in the convenience store landscape. In addition to offering fewer stores than competitor 7-Eleven, translating into lower sales overall, the brand is also struggling due to growing competition from new 24-hour supermarkets and threats from online retailers.

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