SINGAPORE: Singapore retail sales plunged 40.5 per cent year-on-year in April as the COVID-19 pandemic and “circuit breaker” measures shuttered non-essential businesses across the country, data released by the Department of Statistics (SingStat) showed on Friday (Jun 5).
The fall is the biggest since 1986 in the earliest data that is available on the SingStat website, said Reuters, and comes after the 13.3 per cent fall in March.
Singapore imposed a circuit breaker period from Apr 7 in a bid to curb the spread of COVID-19, shutting non-essential workplaces and implementing home-based learning for students. The circuit breaker ended on Jun 1, and the Government has said it plans to reopen the economy in three phases.
Analysts said retail sales could begin recovering only after Singapore enters Phase 2 of the reopening, but the slump could eventually cause full-year sales to contract more than three times that in 2019.
Excluding motor vehicles, retail sales fell 32.8 per cent as consumption fell across categories such as food and beverage (F&B) and apparel.
Compared to the previous month, seasonally adjusted retail sales declined 31.7 per cent in April. Excluding motor vehicles, seasonally adjusted retail sales decreased 26 per cent.
The estimated total retail sales value in April was about S$2.1 billion, with online retail sales making up an estimated 17.8 per cent, said SingStat.
Online retail sales of computer and telecommunications equipment, furniture and household equipment industries, as well as supermarkets and hypermarkets made up 70.6 per cent, 50.4 per cent and 7.7 per cent of the total sales of their respective industry.
"Since retail shops and restaurant dining-in options are still off the table for now in the Phase 1 after the lifting of the circuit breaker, retail sales may not fully normalise yet but may only gradually start to recover from Phase 2," said Ms Selena Ling, head of treasury research and strategy at OCBC.
"For the whole of 2020, I expect total retail sales could contract 9.5 per cent, which is more than three times the -2.8 per cent seen in 2019," she added.
UOB economist Barnabas Gan said that a silver lining lies in "the evident rise in online sales demand".
This demand, he said, is likely to encourage retail stores to actively incorporate IT and digital solutions to supplement their businesses.
"We expect the demand for IT and digital solutions to increase in the coming months, driven by the provision of Government incentives, and the need to adapt in these unprecedented times," he said.
Still, he added, retail sales are likely to contract in a double-digit fashion for May and June, with full-year outlook at -5 per cent.
F&B SECTOR AMONG HARDEST HIT
During Singapore’s circuit breaker period, F&B establishments were only allowed to provide takeaway or delivery services, contributing to a 53 per cent fall in sales compared to last year.
On a seasonally adjusted basis, sales of F&B services decreased 38.8 per cent in April over the previous month.
The total sales value of F&B services in April was estimated at S$397 million. Of these, online food & beverage sales made up an estimated 39.2 per cent.
The turnover of restaurants and food caterers declined 66.9 per cent and 59.8 per cent respectively in April compared to last year. Similarly, turnover of cafes, food courts and other eating places as well as fast food outlets decreased 45.5 per cent and 28.6 per cent respectively during this period.
On a seasonally adjusted basis, turnover of restaurants decreased 53.6 per cent compared to March. Cafes, food courts and other eating places, as well as fast food outlets also recorded lower sales of between 0.5 per cent and 36.1 per cent during this period.
DEMAND FOR GROCERIES REMAINS HIGH
On a year-on-year basis, retailers of watches and jewellery, wearing apparel and footwear, as well as department stores experienced declines in sales of between 84.6 per cent and 87.8 per cent in April, due to the closure of physical stores for most of the month.
Motor vehicles sales also declined 77 per cent as a result of the closure of car showrooms and suspension of Certificate of Entitlement (COE) bidding.
Based on seasonally adjusted data, sales of the watches and jewellery industry and department stores declined 81.3 per cent and 75 per cent respectively compared to March. Retailers of wearing apparel and footwear, motor vehicles and recreational goods also recorded declines in sales of between 55.3 per cent and 74.8 per cent.
In contrast, sales of supermarkets and hypermarkets as well as mini-marts and convenience stores grew by 74.6 per cent and 10.7 per cent respectively year-on-year, due to higher demand for groceries as more people stayed at home with the closure of most workplace premises and full home-based learning for students.
Based on seasonally adjusted data, sales of supermarkets and hypermarkets, as well as mini-marts and convenience stores increased 30 per cent and 5.3 per cent respectively from March.