SINGAPORE: Supermarket chain Sheng Siong said on Thursday (Apr 23) it will continue to keep essential items affordable despite rising global costs linked to the war in Iran.
The conflict in the Middle East and blockade of the Strait of Hormuz have led to trade rerouting, higher energy prices and increased freight costs.
The Monetary Authority of Singapore (MAS) and the Ministry of Trade and Industry (MTI), in releasing Singapore’s latest inflation figures, had warned that the country’s imported cost pressures are expected to pick up in the months ahead.
“While there may be some upward pressure on costs and prices, the group will continue to do its best to keep essential items available, affordable and competitively priced for customers,” said Sheng Siong.
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On potential supply chain disruptions, the supermarket chain said that the more immediate impact of the Middle East conflict is likely to be higher global costs arising from rising fuel, fertiliser and packaging prices.
Sheng Siong added that it manages supply chain risks through diversified sourcing, direct procurement, and strengthening relationships with multiple suppliers across different countries and regions, thus reducing reliance on any single source or supply route.
“At this stage, the group does not foresee any major disruptions that would materially affect the availability of essential products,” said Sheng Siong.
The supermarket’s comments came in a Singapore Exchange filing on Thursday, in response to shareholder questions ahead of the company’s annual general meeting on Apr 29.
When asked about plans to open more stores, Sheng Siong said its strategy is guided by factors such as reasonable rent, suitable space configuration, and a strong or potentially strong catchment population.
And while these factors have historically been more favourable in heartland locations, more opportunities in malls have emerged in recent years, it added.
Recent openings at Leisure Park Kallang, Kinex and The Cathay reflect this more flexible approach of expanding into areas where its presence is limited, with store formats and product mixes tailored to local demand, the supermarket said.
“The group is satisfied with the performance of these stores so far and will continue to consider suitable opportunities in malls where the economics are attractive,” said Sheng Siong, adding that it remains committed to its value-for-money proposition.
Sheng Siong also said it had secured three new supermarket leases, with operations expected to commence in the 2026 fiscal year.
Tenders for five Housing Development Board (HDB) supermarket locations are still pending results, it added.
Separately, the supermarket said it is exploring alternative partnerships and delivery platforms after its joint venture with Deliveroo ended in March, following Deliveroo’s cessation of operations that same month.
Sheng Siong also plans to expand its house brand offerings, which it said are becoming an increasingly important part of its product mix.
The supermarket currently carries 28 house brands with more than 2,000 products. They generally carry better margins than third-party brands, while also strengthening the company’s value proposition by offering customers quality products at competitive prices, Sheng Siong said.
The development of new house brand products depends on a range of factors, including customer demand, product quality, price competitiveness, differentiation from national brands, supply reliability, margin potential, and whether the product adds value to customers or fills a gap in the supermarket’s existing assortment.
“Going forward, the group intends to continue expanding its house brand range,” said Sheng Siong.
“The focus will be on categories where there is strong customer demand, clear value for customers and opportunities to further differentiate the group’s offering.”
When asked about the upcoming Johor Bahru–Singapore Rapid Transit System (RTS) and whether it poses a threat to the business, Sheng Siong said the potential impact of the RTS remains uncertain and will depend on factors such as exchange rates, relative pricing and consumer preferences.
Sheng Siong supermarkets in the north of Singapore account for around 12 per cent of the company’s stores.
“Convenience, proximity and the need for frequent purchases will remain key drivers of grocery shopping behaviour,” said Sheng Siong.
“While some consumers may choose to shop across the border more often after the RTS opens, the higher opportunity cost of time relative to the absolute savings on groceries may limit the overall impact.
The supermarket said it will continue to monitor consumer behaviour in northern Singapore and where necessary, adapt its pricing and product mix to remain competitive.
Meanwhile rival supermarket chain FairPrice had also said on Thursday it will freeze the prices of more than 300 everyday essentials from Apr 9 to May 31 to keep groceries affordable.
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The conflict in the Middle East and blockade of the Strait of Hormuz have led to trade rerouting, higher energy prices and increased freight costs.
The Monetary Authority of Singapore (MAS) and the Ministry of Trade and Industry (MTI), in releasing Singapore’s latest inflation figures, had warned that the country’s imported cost pressures are expected to pick up in the months ahead.
“While there may be some upward pressure on costs and prices, the group will continue to do its best to keep essential items available, affordable and competitively priced for customers,” said Sheng Siong.
CNA Games
Show More Show Less
On potential supply chain disruptions, the supermarket chain said that the more immediate impact of the Middle East conflict is likely to be higher global costs arising from rising fuel, fertiliser and packaging prices.
Sheng Siong added that it manages supply chain risks through diversified sourcing, direct procurement, and strengthening relationships with multiple suppliers across different countries and regions, thus reducing reliance on any single source or supply route.
“At this stage, the group does not foresee any major disruptions that would materially affect the availability of essential products,” said Sheng Siong.
MALL OPPORTUNITIES
The supermarket’s comments came in a Singapore Exchange filing on Thursday, in response to shareholder questions ahead of the company’s annual general meeting on Apr 29.
When asked about plans to open more stores, Sheng Siong said its strategy is guided by factors such as reasonable rent, suitable space configuration, and a strong or potentially strong catchment population.
And while these factors have historically been more favourable in heartland locations, more opportunities in malls have emerged in recent years, it added.
Recent openings at Leisure Park Kallang, Kinex and The Cathay reflect this more flexible approach of expanding into areas where its presence is limited, with store formats and product mixes tailored to local demand, the supermarket said.
“The group is satisfied with the performance of these stores so far and will continue to consider suitable opportunities in malls where the economics are attractive,” said Sheng Siong, adding that it remains committed to its value-for-money proposition.
Sheng Siong also said it had secured three new supermarket leases, with operations expected to commence in the 2026 fiscal year.
Tenders for five Housing Development Board (HDB) supermarket locations are still pending results, it added.
Separately, the supermarket said it is exploring alternative partnerships and delivery platforms after its joint venture with Deliveroo ended in March, following Deliveroo’s cessation of operations that same month.
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MORE HOUSE BRANDS
Sheng Siong also plans to expand its house brand offerings, which it said are becoming an increasingly important part of its product mix.
The supermarket currently carries 28 house brands with more than 2,000 products. They generally carry better margins than third-party brands, while also strengthening the company’s value proposition by offering customers quality products at competitive prices, Sheng Siong said.
The development of new house brand products depends on a range of factors, including customer demand, product quality, price competitiveness, differentiation from national brands, supply reliability, margin potential, and whether the product adds value to customers or fills a gap in the supermarket’s existing assortment.
“Going forward, the group intends to continue expanding its house brand range,” said Sheng Siong.
“The focus will be on categories where there is strong customer demand, clear value for customers and opportunities to further differentiate the group’s offering.”
RTS THREAT "UNCERTAIN"
When asked about the upcoming Johor Bahru–Singapore Rapid Transit System (RTS) and whether it poses a threat to the business, Sheng Siong said the potential impact of the RTS remains uncertain and will depend on factors such as exchange rates, relative pricing and consumer preferences.
Sheng Siong supermarkets in the north of Singapore account for around 12 per cent of the company’s stores.
“Convenience, proximity and the need for frequent purchases will remain key drivers of grocery shopping behaviour,” said Sheng Siong.
“While some consumers may choose to shop across the border more often after the RTS opens, the higher opportunity cost of time relative to the absolute savings on groceries may limit the overall impact.
The supermarket said it will continue to monitor consumer behaviour in northern Singapore and where necessary, adapt its pricing and product mix to remain competitive.
Meanwhile rival supermarket chain FairPrice had also said on Thursday it will freeze the prices of more than 300 everyday essentials from Apr 9 to May 31 to keep groceries affordable.
Related:
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