MAY 2018 FEATURE:

Come September this year, SFIC will expanding Singapore’s presence beyond the usual Furniture Shanghai exhibition in Pudong. A significant number of brands representing Singapore’s furniture finest will be making its debut at the China International Furniture Fair (Shanghai) in Hongqiao as well. This was an outcome from the MOU signed between SFIC and Red Star Macalline during the 14-17 May 2018 Business Development Mission that was jointly led by the SFIC and Enterprise Singapore (ESG).

In March this year, Red Star Macalline Group Co Ltd had signed a strategic partnership agreement with China Participating companies for the four-day mission mission included representatives from Cellini, Commune, Golden Abundance, Star Furniture, Sungei Emas and Wayco.

Redstar Macalline may not (yet) be a familiar name to some of our industry players but it is currently one of the largest national home improvement and furniture retail platforms in China, with about 259 home furnishing malls across 182 cities. In March this year, Red Star Macalline Group Co, Ltd had signed a strategic partnership agreement with the China Foreign Trade Guangzhou Exhibition General Corporation on the annual CIFF exhibitions held in September (Shanghai) and March (Guangzhou). Founded in 1986, the Chinese retail behemoth graciously hosted a tour for our delegates at three of its themed malls.

It is estimated that the Chinese urban middle class will account for 18% of global urban consumption growth by 2030. With Chinese consumers favouring imported brands (including those from Singapore) over domestic ones, the potential can be enormous but it also means there will be tough competition.

To succeed in wooing the increasingly affluent Chinese customer, product offerings have to align with consumer tastes and lifestyles. The Shanghai mission presents an opportunity for delegates to familiarise themselves with the China market through a series of strategic meetings with influential players and site visits to their biggest furniture and lifestyle malls.

The Redstar visit kicked off with a trip to its high-end Ogloria (欧丽洛雅) Shopping Mall where international furniture brands such as Hastens and Ligne Roset dot its aisles. The 18-man delegation also visited Aegean (爱琴海) a one-stop lifestyle shopping mall that included dining options and fashion boutiques, as well as the 金桥商场. The last leg of the tour was spent at the ‘’2050-2500 Smart Home’’ experience centre located within the Zhenbei (真北) Shopping Mall, where the delegates were offered a glimpse of Redstar’s vision of future living centred on technology.

Yue Xing Jia Ju (月星家居), another furnishings giant with a formidable presence in China, offers an alternative case study on cracking the Chinese retail market. Aspiring to be the ‘’Harrods department store of the East’’, the 25-year old Yue Xing Jia Ju is a pioneer in bringing the concept of furniture-related products into shopping malls in China. Since embarking on a “100 retailers plan” in March 2010, Yue Xing has connected more than 50 major shopping malls around prefecture-level cities.

At its Shanghai outpost, a familiar logo can be found. Homegrown furniture brand Commune has been operating a successful franchise in China for a few years and the Yue Xing outlet is just one of 45, with the goal of opening 100 stores across China by 2020.

As consumer tastes in home furnishings becomes increasingly sophisticated, the likes of Norhor (北欧表情), a retail concept store which carries global design-centric brands, are beginning to proliferate. Since its inception in 2003 as an e-commerce platform, it now boasts of its own physical retail stores in Hangzhou, Shanghai, Beijing and Shenzhen. In its meeting with the SFIC/ESG delegation, Norhor expressed interest in ASEAN brands and shared that it carries products from Singapore labels such as Jottergoods and Mic Studio, which were sourced during its previous visit to the International Furniture Fair Singapore (IFFS) show.

Chinese consumers (and companies) are quickly embracing digitalisation as a way of life and even street vendors these days prefer electronic payments over cash. Retail-related businesses are evolving in response, as evident during the visits to three organisations that adopt the latest technologies to improve product offerings.

Hong Kong-based Li & Fung, welcomed the SFIC/ESG-led delegation at its two-storey Explorium (利程坊) operations billed as “the world’s first retail business model testing platform”. The supply chain management and retailing major conducts experiments on new retail business ideas and technology and Explorium is its omnichannel retail laboratory for the China market. Since commencing operations in 2015, about some 2,000 visitors have passed through its doors weekly to browse through its dozens of shops and to make purchases using mobile devices, while wearing data recording wrist bands that track their movements.

Like Explorium, tthe FUSE retail pop-up store at 333 Tianshiqiao Road is no ordinary pop-up. The sensor-laden retail space tracks user interaction with products and offers real-time reports on item popularity. The Shanghai-based Singapore brand consultancy helps foreign clients test the Chinese market through in-market pop-ups such as this one. At the sharing session at Enterprise Singapore’s Shanghai office, fellow Singaporean entrepreneur, Ms Emmy Teo, CEO of FUSE presented invaluable insights on the latest Chinese e-commerce consumer trends.

Another tech-driven retail showcase on the itinerary comes courtesy of Alibaba. 13 Hema (盒马集市) supermarkets that have been opened by the ubiquitous brand since 2015, with 10 operating in Shanghai. Fully mobile-powered with Alipay enabled, each branch aims to serve a customer base within a three-kilometre radius to ensure fast, high-level service. Hema mobile app users have various options including grocery deliveries or having fresh food prepared by Hema chefs to be delivered within 30 minutes. Thanks to its ability to fulfill thousands of orders daily, the stores’ sales per unit area outperform other supermarkets by three to five times.

The mission trip would not be possible without the strong support from Enterprise Singapore (ESG), with Mr Alan Yeo, Director of Retail and Design, as the Co-Mission Leader, and Mr Wan D Sen (ESG HQ) as well as Ms Hua Qianni (based in ESG Shanghai) as part of the delegation. Next month, SFIC will be heading to Manila, Philippines with another group of industry players as well as ESG’s Executive Director (Lifestyle & Consumer) Ms Kee Ai Nah for a similar business development mission.

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