Some products cost more in S’pore than other cities: MAS & MTI study
- POSTED: 29 Apr 2014 12:36
- UPDATED: 29 Apr 2014 23:05
Buying a product from Apple, Zara and IKEA could cost more in Singapore compared to 10 other cities, according to a study by the Monetary Authority of Singapore (MAS) and Ministry of Trade and Industry (MTI).
SINGAPORE: Buying a product from Apple, Zara and IKEA could cost more in Singapore compared to 10 other cities, according to a study by the Monetary Authority of Singapore (MAS) and Ministry of Trade and Industry (MTI).
According to the study -- which analyses price differences for 647 items from the three global brands across the 11 cities --"Singapore's prices are found to be relatively high in most instances".
Releasing the findings on Tuesday as part of the its Macroeconomic Review, MAS said Singapore's prices are above the median for two-thirds of the items, and prices for about a quarter of them are below the median.
This means that for the same brand, prices in Singapore can be higher than in other cities for some items but lower for others.
Among the cities included in the study are London, Paris, New York, Shanghai and Hong Kong.
MAS added that for most of the items which are more expensive in Singapore, the price premiums do not exceed 20 per cent.
The report said pricing decisions of the firms are influenced by unit cost and demand for their products in the market.
Costs involved in importing products from further afield as well as Singapore's small market size appear to have contributed to higher prices.
"Singapore has a strong Sing dollar. That causes our imports of these duty goods (to be) slightly higher than the rest of the (countries),” said Steven Goh, executive director of the Orchard Road Business Asscociation.
He added that in Singapore, the “cost of operation is very high, especially rental and labour costs.”
A concern for businesses is the perception that things are generally expensive in Singapore. If this perception is reinforced over time, consumer spending in the country could slow, hurting the bottom-line of many firms.
Authorities have stressed that their study should not be taken as representative of differences in the overall cost of living across cities, since only three global brands were analysed.
MAS said the three global brands in the study -- Apple, Zara and IKEA -- were chosen given the large number of identical consumer electronics, furniture, and apparel products that could be compared across cities.
The study also pointed out that Singapore is not the most expensive location, and it is most expensive for only six per cent of the products surveyed.