Online shops head to Orchard as rent falls


Online shops head to Orchard as rent falls

Falling rents prompt online retailers to opt for physical presence in prime shopping area

Linette Heng (/author/linette-heng) 

Dec 20, 2016 06:00 am


With its minimalist design, neutral colour scheme and a tree as the centrepiece, the store looks just like any high-end boutique.

But the women’s wear store started on the Internet.

Launched last year to a cult following, Beyond The Vines moved into a 650 sq ft unit at Mandarin Gallery in June, while maintaining its online presence.

Softer rents over the past year have given home-grown online brands opportunities to be part of Singapore’s prime shopping district, say experts.

Latest gures from Savills Research & Consultancy show that average monthly rent in Orchard Road was $29.90 per sq ft in the third quarter, compared to $31.60 per sq ft last year.

A spokesman for Beyond The Vines told The New Paper: “Our customers’ needs is a key consideration and having a physical retail space has made it more accessible for customers to experience the brand and try on the styles before buying.”

Online retailer Ellysage, which started selling women’s apparel from blogging platform Livejournal in 2012, also took advantage of lower rents to open its agship store at swanky Ion Orchard in September.

Its founder, Ms Samantha Soh, considered the branding of the mall and foot trac before deciding on the location.

“Even in weak conditions, some malls are still performing better than others, though ‘performing better’ is still poor when you look at a longer horizon,” she said.

She also lists the challenges – new overheads such as rent, stang and shipping of goods to the store every week. Nonetheless, Dr Lynda Wee, adjunct associate professor specialising in retail management at Nanyang Technological University, said there are advantages to setting up shop in town.

She said: “Downtown stores reach out to tourist shoppers and hence global exposure. They are also known for their fashion trends and appeal to fashion-forward shoppers.”

Ms Sarah Lim, a senior retail lecturer from Singapore Polytechnic (SP) noted that some people do not enjoy online shopping.

She said: “Not everyone is aware of online stores and having a physical store creates awareness and builds reputation and more business online.”

Ellysage’s Ms Soh thinks the experience of trying on clothes is important for a fashion brand.

“A store helps to convey to customers Ellysage’s focus on design, quality and t much better than an online site can,” she said. A physical store may not be a permanent strategy for online brands, said SP’s Ms Lim.

“They can set up physical pop-up stores to build awareness and loyalty. Online retail is their main avenue to drive sales in the long run,” she said.

One of Singapore’s pioneer blog shops, Love, Bonito, had three pop-up stores before opening its largest one at 313@Somerset (mailto:313@Somerset) in late October, also because of falling rents.

Its founder, Ms Rachel Lim, said: “As this is a relatively new area we’re venturing into, we need to constantly tweak the merchandise mix and refresh the store to make it exciting for customers.”