French Hypermart pulling out 2012

Singapore

Hypermarket pioneer in the Republic closing its 2 stores by the end of the year

SINGAPORE – It gave Singapore its first hypermarket in 1997 when it set up shop at Suntec City Mall.

Now, 15 years later, French supermarket operator Carrefour is saying adieu after being forced out, ironically, by the flourishing of the superstore concept – which combines a supermarket and a department store – that it pioneered here.

Carrefour announced yesterday that it will close both its outlets at Suntec City and Plaza Singapura by the end of the year. In a press release, it attributed the pull-out to the reason that “expansion and growth perspectives do not allow reaching a leadership position in the medium and long-term”.

Carrefour’s lease at Suntec City and Plaza Singapura will expire in December and November, respectively.

The news was not unexpected. In 2010, Carrefour unsuccessfully tried to sell its operations in Singapore and Malaysia.

Shoppers told TODAY they would miss its outlets. Mrs Fong P P, 40, does her weekly family grocery shopping at the Carrefour outlet at Suntec City. She said she would particularly miss the hypermarket’s array of French products, including cheese and sauces, which are cheaper compared to those being sold in other places.

Ms Pauline Ng, 42, said she makes it a point to go to Carrefour’s Plaza Singapura outlet to buy meat for her barbecue sessions, as the outlet offers a wide variety and the products are neatly organised.

Carrefour, the world’s second-biggest retailer behind Walmart of the United States, reported in March that its profit last year dropped 14.3 per cent to €371 million (S$583 million) amid weaker economic conditions.

Last month, it pulled out of recession-hit Greece amid falling sales.

Last week, analysts told Reuters they expected Carrefour to close stores in Indonesia, Turkey, Poland, Malaysia and Singapore.

In Singapore, Carrefour has faced stiff competition from the biggest supermarket operators here: Hong Kong’s Dairy Farm Group – which runs Giant, Cold Storage and other chains – and local players NTUC FairPrice and Sheng Siong.

Carrefour opened its second outlet at Plaza Singapura in 2003. A Plaza Singapura spokesperson said it is “exploring possibilities” for the 81,000-sq-ft space at Level 1 and Basement 2 Carrefour will be vacating.

When contacted, Suntec Reit CEO Yeo See Kiat did not reveal specific plans for Carrefour’s existing lease space at Suntec City. “When the space is handed back … it will be closed for us to execute Phase Two of the remaking of Suntec City project,” said Mr Yeo.

Nevertheless, a Dairy Farm Singapore spokesperson announced that the group has signed a lease to open a 60,000-sq-ft Giant hypermarket at Suntec City. “We are targeting to open the new Giant within the first half of next year. We are also interested to explore the good strategic site at Plaza Singapura,” the spokesperson said.

Some 390 staff affected

The closure of Carrefour’s two outlets will affect about 390 employees. Carrefour Singapore said that it intends to “contact local retailers to facilitate redeployment” of the affected staff.

Both Dairy Farm Singapore and NTUC FairPrice said they are open to taking in staff who would be affected by Carrefour’s pull-out.

Mr John de Payva, Secretary-General Emeritus of the Singapore Manual & Mercantile Workers’ Union (SMMWU), said that it is already in discussion with the management of Carrefour Singapore to help the staff who will be affected by the closure of the stores.

Apart from contacting other SMMWU-unionised retailers to see if they are able to recruit some of the affected staff, the union has also contacted NTUC’s Employment and Employability Institute to “help the affected staff find jobs or go for retraining so that they can switch industries”, said Mr de Payva.

By Amanda Lee
Today
29 August 2012

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