QUESTION
SOLUTION
Singapore has been a great market for business and especially in the retail industry. After the slow down and again the recovery of the economy there was immense confidence in the consumers. Their purchasing power had increased and again they started spending which was a boost to the retail industry. But at the same time the consumers became more conscious of spending their money. This is also because many players have joined in the competition and a number of retail outlets have opened in the country. Shop N save, Dairy Farm international, and Shen Siong supermarket are some of the retailers to name a few.
(Euromonitor International, 2012) The retail industry in Singapore is primarily categorized into two large segments and these are namely, the mass market and the premium market segment. The mass market usually represents the lower and middle income segments who stay in the flats and public housing estates where as the premium market is usually the segments which caters to individuals who are on the higher income side. The mass and the premium segments both contribute to the economy of the retail industry and the mass market is the one which is sensitive towards the price.
PEST Analysis is a powerful tool to analyse the macro factors affecting the business and the industry. The analysis of the political, economic, social/cultural, and technological lets us know many facets of the industry and hence helps in the formulation of strategies which are helpful for the firms belonging to this industry top face the intense competition from the competitors.
SWOT Analysis: The strengths are the demographic content, the supportive business environmental framework, the existing manpower. The opportunities in this market in terms of retail are many; there is a lot of scope in the expansion and the e-commerce business. Threat is the intense competition and the weakness is the high wages that needs to be paid.
(Enterprise Innovation Editor, 2010) Prior to talking about what the retail firms should do and what strategies should they follow for more profit, it is imperative to understand the objective of their business and how it connects to the profit making. An easy measure to know it is the mission and vision statement. The mission statement tells the consumers what the firm is determined to do over a comparatively shport period of time whereas the company’s vision statement is the long term objective of the firm which it strives to achieve by laying down long term strategies in place. The clue to write a perfect vision and mission statement is to have atomicity and specificity. The firms
Recommendations:
To remain competitive in the market the firms which fall under the retail category segment should take care of the following aspects and devise adequate strategies in each category to sustain its business profitably.
Location: The location of the retail outlet is very important. The location of the store should be convenient. Small issues like no parking space can be the sole reason why the business will not be able to perform.
Price: As the competition increases and many players come to the market to get a strong foothold, price remains a competitive factor. Because the consumers are aware that they have many options they do not usually prefer the same product at a high price when they can get at a lower price.
Customer Loyalty: Every business strives hard to get new customers and retain the old one. They devise a lot of strategies for customer acquisition and retention. The firms that fall under this vertical take great measures to lure their customers. They have also launched various kinds of programs like launching the customer loyalty cards.
Customer satisfaction and service: Customer service is a crucial aspect for the retail firms and the firms should see that the customers who leave their retail outlets are satisfied and the service that they are proving to them while they are in their store is excellent. A minor mistake in not providing the proper care and attention to the customer can lead to customer de engagement with the firm and which will drive the traffic from one firm to the other.
Quality and Variety: The consumer behavior changes from time to time and the retails firms must be cautious enough to analyze the change in the consumer behavior and their needs. Based on the same they should provide them with the range of products that they are looking for. Along with the wide range on offer the companies should not lose focus from the quality that they offer. Because of the competition there are many options available and the firm should not provide any loop hole so that the customers hop to the other supermarket. Also to build up adequate trust in the market quality is an important factor. To sum up the firms should provide the customer value proposition.
New and Innovative products: (Retail Asia, 2011) Firms should strive to provide the customers with new and innovative products to lure the customers. In the age of e commerce people are aware of all the new products by clicking one click on the mouse button hence the companies should keep up to the pace of the globalized world and should provide new products and enhance the old products to retain their customers.
Convenience and Reach: The store should be at a convenient location so that the customer is not too far from the store. This would encourage repeat purchase and would give the firm the opportunity to make great profits with the same set of customers in a short time frame.
New markets: Apart from carrying out the above strategies, the firms should also explore new markets and geographies. This means that the companies present in one part of Singapore should spread in the country by introducing new branches, and also it should explore in other countries. This gives the firms the opportunity to grab new target segments and customers.
E-Commerce: The firms should have a positive online presence to give the customers the space and flexibility to shop from anywhere.
Mobile Applications: Mobile applications are a great way to connect to the customers and these provide the opportunity to the firms for extreme penetration and better positioning of their firms in the minds of the customers. As the customers these days all have phones which are equipped to download the apps, they will have the flexibility to check and see the various offerings which the retail firms have to offer and then subsequently shop for it. This is a great way to not only to connect with the customers but also to promote the firms in an excellent way because the mobile apps can be downloaded irrespective of the location and the customers who are not based near to the store can have the advantage to know about the firm and to shop from the online store.
Thus is very evident that the retail segment is one of the powerful segments in the country of Singapore and has a lot of scope to innovate and make profits in the long run if proper plan and strategies are laid down in place and all the major aspects are considered while doing business.
Reference:
Euromonitor International, Feb 2012, Retailing in Singapore, viewed on 21st April 2012, http://www.euromonitor.com/retailing-in-singapore/report
Enterprise Innovation Editors, 9 December 2010, Singapore’s retail industry rises from ashes to crisis, Viewed on 21st April 2012, http://www.enterpriseinnovation.net/content/singapores-retail-industry-rises-ashes-crisis
Retail Asia, Jan 2011, Retail Outlook 2011 – the Year Ahead: Retailers and mall operators in Singapore, Malaysia, the Philippines, Thailand and India share their views and expectations for this year, viewed on 21st April 2012, http://www.retailasiaonline.com/magazine/archive/2011/mag2011-01_story03.html
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