Surviving recession: I lost my shop after 16 years. But my fashion business isn’t dead yet
Elsie Szto, who’s in her 50s, saw her boutique go from thriving in the CBD to slumping in a virtual ghost town. She’s one of 12 Singaporeans who shared with CNA Insider how they’ve weathered COVID-19’s economic fallout.
SINGAPORE: “Unless you really need to, don't start a fashion business. Do something else.”
I once jokingly gave that piece of advice when someone asked me about the challenges of being a fashion entrepreneur during a pandemic. That was months ago, when I still had my shop, Butterflies and Marigold, in Guoco Tower.
We had just come out of the circuit breaker, when we had zero sales for two months — my first in 16 years of business. Needless to say, things were tough and definitely uncertain.
EXPLORE THE INTERACTIVE SPECIAL: Surviving recession: How 12 Singaporeans Weathered COVID-19's Economic Fallout
You would think being able to reopen in Phase 1 meant good news for us, but sales were dismal, to say the least.
We were located in the Central Business District (CBD), and a lot of our customers were still working from home.
Foot traffic dropped violently, and it was like a ghost town.
WATCH: I lost my boutique — Now I'm fighting to keep it alive online (5:58)
It was important for my business partner and I to start talking to our landlord about our plans after our rental relief was to end in August.
To be fair, given the customer footfall when we signed the lease three years ago, our rent was reasonable. Guoco Tower is linked to the Tanjong Pagar MRT station, a very busy station.
But when we reopened, the footfall was close to zero, so our rent should come down reasonably for us to survive.
Meanwhile, I had to adjust my lifestyle. Very quickly, we started cooking at home — no more eating out, no more restaurant meals. It was a practical way of being thrifty without compromising family time with our two boys.
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Thankfully, my husband has a stable, full-time job, so that has helped. But to keep my business alive, I knew I had to reach out to our customers who were still working from home.
As a small business, we were nimble and were able to adapt to the situation. We set up an online shopping platform through Shopify. We even started live-streaming on Facebook every week to sell our clothes.
We managed to get some sales, and the interaction with our long-time customers was good.
One thing I really cherish about 16 years of doing business is the relationship with our customers. That is something we have not lost to COVID-19.
While things were picking up for us on the digital front, our conversations with the landlord were not yielding much fruit.
As early as July, we proposed a Gross Turnover Model, which was in essence asking the landlord to share our pain. That did not go through.
The landlord was willing to give us a small rental reduction, but that was still disproportionate to the drop in footfall.
Our last resort was to file for a Notification of Relief, which helps SMEs like us to defer rental payments until November. That allowed us to manage our cash flow for the time being.
When November came, we were due to speak to the landlord again. Our lease was going to expire at the end of the month, and given how uncertain things were, I thought we could negotiate a shorter lease — six months or a year — instead of committing to a longer one.
We were still quite hopeful. But before we could make that proposal, the landlord told us: "Oh, Elsie, I've got good news for you. We found someone to take over your shop already."
Editor’s Note: GuocoLand has clarified that Butterflies & Marigolds was informed in September 2020 that their option to renew their lease had lapsed, and as such, GuocoLand would begin sourcing for a suitable replacement tenant.
I lost it, of course.
The landlord knew our pre-COVID sales numbers — we were here for the past three years — and that Butterflies and Marigold was a profitable business. We had consistently turned in those numbers.
How could they do this to us, especially when it is so difficult for retailers now?
We could find another shop space, but let me put it this way: Say you are playing football and suddenly there is a heavy downpour. Do you want to keep playing in the rain? Or take shelter for a while?
Perhaps for Butterflies and Marigolds, this is our time to take shelter. We are going to try to pivot 100 per cent towards online for now.
We can operate out of a warehouse or my home, as long as we find the space to continue live-streaming every week.
I still had a very good run. My partner and I ran a very successful business for 16 years. That is an achievement that nobody can take away.
Of course I feel very sad to let this shop go. But as painful as it may be, it is not the end of the road.