Mr S Iswaran at the 2010 Singapore Retail Industry Conference –CEO Forum, 31 Aug 2010

SPEECH BY MR S ISWARAN, SENIOR MINISTER OF STATE FOR TRADE & INDUSTRY AND EDUCATION, AT THE 2010 SINGAPORE RETAIL INDUSTRY CONFERENCE –CEO FORUM ON TUESDAY, 31 AUGUST 2010, 0900 HRS, AT SUNTEC INTERNATIONAL CONVENTION CENTRE

Dr Jannie Tay, President, Singapore Retailers Association

Distinguished Guests,

Ladies and Gentlemen,

Introduction

Good morning. I am happy to join you here at the opening ceremony of the Singapore Retail Industry Conference (SRIC)-CEO forum.

The Retail Industry in Singapore

Over the last decade, we have witnessed a major transformation in Singapore’s retail industry. Today, Singapore is widely regarded as one of the most vibrant and exciting shopping destinations in Asia.In a recent poll conducted by Global Language Monitor, Singapore moved up five spots to rank 15th on the list of top 20 fashion capitals of the world. The retail industry is also a significant contributor to Singapore’s economy.In 2008, the industry registered some $26.2 billion in sales revenue and generated $3.8 billion in value-Add[1]. This accounts for about 1.4 percent of our GDP.The industry also employs over 100,000 workers in some 19,000 establishments[2], which is about 4 per cent of Singapore’s total workforce.

Positive Economic Outlook

This year’s positive economic outlook has led to a rise in consumer confidence. Singapore has weathered last year’s global financial crisis well and emerged stronger. For 2010, the Singapore economy is expected to grow by 13 to 15 per cent. The Nielsen’s Global Consumer Confidence survey conducted earlier this year shows a dramatic increase in consumer sentiment across most major economies in the world. Singapore was amongst the top 10 most confident countries[3]. The International Monetary Fund (IMF) has also forecast that Asia will lead worldwide GDP growth for 2010.

Productivity in the Retail Industry

These trends bode well for the further sustained growth of our retail industry. However, if we are to realise the full potential of these developments, raising productivity levels will be key. The productivity or VA per worker, of the retail industry currently stands at $37,000, which is only 40 per cent of that for the whole economy. Singapore also lags behind other international cities like Hong Kong and New York in this regard. Our retail productivity is only 66 per cent that of Hong Kong’s and 44 per cent that of New York’s[4].

A recent study conducted by SPRING to assess the productivity levels in the sector, highlighted some paths to improve productivity. This includes process innovation and enhancing efficiency with the help of technology. Indeed, some forward-looking companies have started using internet-facilitated replenishment systems which help to lessen paperwork and reduce human errors.

SPRING’s study also emphasised the correlation between the skill level of the retail workforce and productivity rates.According to the Ministry of Manpower (MOM)’s Employer-Supported Training Report 2008[5], only 41 per cent of retail establishments currently provide some form of structured training to workers compared to the national average of 65 per cent across all industries. This is insufficient if we are to create and sustain a skilled workforce for the retail industry.

Certified Productivity Practitioner (Retail)

It is therefore important that the retail industry focuses on consistently upgrading the skills of its workforce.This extends to all levels in the organisation including frontline workers such as sales assistants, supervisors, as well as the management in the organisation.

In this regard, earlier this year the Workforce Development Agency (WDA) and SPRING Singapore, worked with the Retail Industry Skills and Training Council (RISTC), to develop a suite of training programmes geared towards increasing productivity in the retail industry.,

Productivity-related competency units have also been proposed to be added to the Retail Workforce Skills Qualifications (WSQ) framework. These units follow the competency-based training principle of Retail WSQ and will equip the retail workforce at the operations, supervisory and management levels to implement productivity improvement measures in their work environment.

I am therefore pleased to announce that the SRA in collaboration with the Singapore Productivity Association (SPA), has developed an 8-day training programme for the retail sector. Based on the Certified Productivity Practitioner (CPP) training curriculum, this new programme known as CPP (Retail), is customised specifically for the retail industry. It is targeted at executives who have been identified as “productivity champions” in their respective organisations. Participants will learn to identify and analyse productivity issues affecting their companies, develop solutions and implement strategies that will address these issues. And they will also be equipped with tools and systems that will help the company develop a productive sales team, and grow its top-line.

Conclusion

I urge all companies in the retail sector to take advantage of initiatives like CPP (Retail). Leverage on them to further develop the skills of your workforce and, in so doing, improve the productivity levels and operational efficiency of your company.

In conclusion, I would like to commend SRA on its on-going efforts to help the retail industry grow and stay abreast of market trends and external competition. With Asia leading the global economic recovery, there is much in the way of opportunity.However, we will also have to contend with stiff competition from the region.We need to improve our productivity rates, as well as enhance our products and services, so as to stay ahead of the competition. SRA has been working with Government agencies such as SPRING, STB and WDA to help the industry players innovate and upgrade their capabilities and expand into emerging markets like China, India, the Middle East and the Latin Americas.

This conference and, in particular, this CEO forum, should also serve as a useful platform to consider the opportunities and challenges that lie ahead for the retail industry, and the strategies that can be embraced to deal with them.I am confident that the collective endeavours of the industry, its people and government agencies will help develop an even more dynamic and vibrant retail sector in Singapore.

I wish everyone a fruitful and productive day ahead at this SRIC- CEO Forum.Thank you.

[1]

Department of Statistics. (2010). Economic Surveys Series 2008 – Retail Trade. Retrieved from Statistics Singapore online database

[2]

Excludes motor vehicles and petrol kiosks.

[3]

Nielsen. (2010). Nielsen Global Consumer Confidence Survey Q2 2010.

[4]

Bureau of Economic Analysis. (2008). Gross Domestic Product (GDP) by State and Metropolitan Area. Retrieved from Regional Economic Accounts database.

[5]

Ministry of Manpower. (2009, Nov). Employer Supported Training 2008. Retrieved from MOM Statistics & Publications online database.