Takings of Singapore’s retailers continued to slide in June despite the earlier than expected phase two measures on June 19 which permitted in-store shopping and dining in at restaurants.
The total retail sales value declined 27.8% year-on-year in June, making this the metric’s fourth straight month of decline. Still, this is an improvement from the historic 52.1% contraction registered in May, data released by the Department of Statistics (Singstat) on August 5 revealed.
June’s decline also beat the 28.5% slide estimated by private-sector economists in a Bloomberg poll.
Bright spots were seen in spending at supermarkets and hypermarkets (43.4%) and computer and telecommunications equipment (20.9%). Singstat attributes this to the continued demand for both groceries and computers as consumers continued on work-from-home arrangements.
Coversely, consumer sectors took the greatest hit, with takings for department stores (-69.5%), wearing apparel and footwear (-63.4%) and watches and jewellery (-53.5%), recreational goods (-40.7%) and optical goods and books (-39.4%) registering declines.
Other industries that registered contractions in June include petrol station services (-33.6%), cosmetics, toiletries and medical goods (-33.1%) and furniture and household equipment (-19.9%).
This comes from a combination of the closure of physical stores in the first two weeks of June and consumers tightening their purse strings due to the weaker economic outlook.
The sale of food and beverage services which 45.7% showed a similar trend. This is a gentle easing from the 50.1% registered in May, and reflects a pick up in patronage from dine in customers.
Meanwhile, motor vehicle sales similarly narrowed to a 47.8% decline as motor vehicle dealerships and showrooms reopened their doors.
To this end, the drop in the retail sales index eased to 24.2% year-on-year excluding motor vehicle sales.
On a seasonally adjusted month-on-month basis, the index surged 53.1%, or 43.1% when motor vehicles were left out.
Total sales value for June came in at $2.6 billion, of which 18.1% came from purchases made online, Singstat shares.
A substantial portion – 69.9% - of these sales were of computer and telecommunications equipment. This comes as people sourced for IT gadgets as they worked from home.
Furniture and household equipment logged the next highest digital sales of 45.6%, as consumers became self-sufficient as they stayed home.
Meanwhile the food and beverage services index – a separate metric – saw takings contract 43.5% year-on-year in June to $496 million.
The slide in receipts were seen across the board, although restaurants took the hardest hit with turnover dropping 59% from the year before.
Takings at other food services such as caterers and fast food joints similarly dropped 48.1% and 20.5% respectively.
On a seasonally-adjusted month-on-month basis, takings were up 18.9%, presumably from higher patronage brought from dining in.
Looking at June’s data, UOB economist Barnabas Gan notes an improvement – even in the hard-hit segments such as wearing apparel and footwear “did see a strong pick up in their month-on-month seasonally adjusted growth rates”. This suggests “some retail demand has returned post-circuit breaker,” he notes.
“Despite the improving environment, most retail industries recorded declines given the absence of tourism demand,” notes Gan who projects full-year retail sales to shrink by 5 per cent year on year.
“Barring a re-introduction of social-distancing measures, the return of domestic consumer demand should also cushion the rate of contraction on a year-on-year perspective for the rest of 2020,” adds Gan.
