7. Lean and Mean Distribution Network
In the early 1990s, suppliers delivered their goods to each of FairPrice’s stores around the island. Some outlets received about 100 deliveries a day. This meant more time spent receiving stock, more retail space used for storage, and more human error and pilferage.
It was clearly an inefficient way of doing business. This changed dramatically in 1993, when FairPrice teamed up with major Australian grocery distributor Davids Holdings. They formed a joint venture called Davids Distribution, a centralised warehouse and distribution company.
Operating out of a warehouse in Joo Koon, Davids Distribution received goods in bulk from suppliers and dispatched them to FairPrice and other retailers including Cold Storage then. Things moved faster and more securely. An electronic system allowed stores to request goods digitally and have them arrive in a secure consignment in half a day.
But there was a niggling issue. Many suppliers were reluctant to put their goods with Davids Distribution as they thought it would eat into their respective wholesaling business.
As the business faltered, FairPrice decided to turn it from a wholesale company to a logistics one. In 1998, it bought over the rest of Davids Distribution for a dollar, and renamed the company Grocery Logistics of Singapore (GLS).
This resolved the problem. GLS remains a FairPrice subsidiary today, and manages more than 1.2 million sq ft of warehouse space as well as a fleet of delivery trucks.
Since its humble beginnings in a corner of Toa Payoh, NTUC FairPrice has become the quintessential Singaporean supermarket. The leap from a single store to a grocery giant is a tale of retail reinvention – a half-century journey that saw the cooperative confront crises and challenges, revamps and even robbers.
As it expanded and evolved, FairPrice never wavered from its core mission: to moderate the cost of living for consumers.
Through 50 remarkable stories, we celebrate the people, products and places that mark significant milestones for the food retailer over the last five decades, charting its growth and successes in the past, present and into the future.