NTUC FairPrice (FairPrice) celebrated its 40th anniversary with a $40 million contribution to the Labour Movement, customers, employees and the less-privileged in the workforce and community at its gala dinner at Marina Bay Sands this evening. This is the single largest amount FairPrice has given away to date as one of Singapore’s largest grocery retailers commemorates 40 years of serving the community together with distinguished guests Prime Minister Lee Hsien Loong, dignitaries, business partners, past FairPrice Chairmen and Board of Trustees and dedicated employees.
The supermarket co-operative has grown since its first NTUC Welcome store in Toa Payoh was set up in 1973 to help moderate the cost of living in Singapore, as prices of staples soared due to the oil crisis during that period. Till today, FairPrice continues to uphold this social mission by benchmarking prices and curbing profiteering of daily essentials. Customers are assured of affordable essentials because of FairPrice’s diversification strategies and various initiatives to battle inflation.
Speaking at the anniversary dinner, Mr Ng Ser Miang, Chairman of NTUC FairPrice said, “FairPrice has grown from a single supermarket store in 1973 to a multi-format retailer with 270 outlets nationwide and an annual sales of $2.8 billion last financial year. As we progress, FairPrice has continued to stay true to our commitment of moderating the cost of living in Singapore. We have initiated many special schemes to help consumers stretch their dollar; such as offering special housebrand discounts and freezing prices in periods of high inflation to ensure daily essentials remain affordable.”
Fulfilling its social mission
FairPrice has continued to be there for the people during times of crisis such as the Asian financial crisis in 1997, the bird flu outbreak in 2004, and the global financial crisis in 2008 by ensuring stable supply of daily essentials like rice, vegetables and eggs. The grocery retailer has worked hard to moderate the cost of living for its customers and suppliers as well as uphold stringent food and safety standards that have won the trust of customers here and abroad.
FairPrice has deployed different strategies to moderate the cost of living for its customers and suppliers. Customers enjoy Housebrand discounts which was implemented during periods of high inflation between 2008 and 2012; Everyday Low Price Items (EDLP) which was introduced in 1994, includes a best value basket of 500 popular grocery items that are price-checked on a weekly basis to ensure that it gives the best deal to customers; and Yellow dot items, which was introduced in 2009, for budget conscious shoppers looking for the lowest priced item in respective product categories. FairPrice also absorbed GST in 1994 for a year when it was first introduced, and held the prices of its housebrand rice from 2011 to March this year. The retailer also takes care of the growing number of elderly with the Seniors’ Discount scheme implemented since 2002. For suppliers, FairPrice introduced the SME supplier assistance scheme in 2009 to help SME suppliers tide over the financial crisis by reducing payment terms, having discounts on listing fees and advertisements and assistance in promoting made in Singapore products.
$40 million contribution
Beyond moderating the cost of living, FairPrice also recognises its role in giving back to the community. To commemorate its 40th anniversary, FairPrice will divide the $40 million contribution equally between four key stakeholders; the Labour Movement will receive $10 million to help advance the welfare of workers; FairPrice members will receive an additional $10 million in rebates; to thank FairPrice employees in appreciation for their hard work, commitment and loyalty, they will receive $10 million as a one-off special bonus, and the philanthropic arm of FairPrice, FairPrice Foundation will receive $10 million to help our Singaporeans in need.
The Future of FairPrice
FairPrice will rise to meet challenges that come with the business, such as higher operating costs, increasing rents, manpower shortages and increasing food prices, by increasing productivity, implementing technology and diversifying its food sources. For example, at the store-front, FairPrice has implemented the self checkout (SCO) system and electronic shelf labelling (ESL) system since 2011 which have increased cashiering productivity by 20 percent and improved shelf labelling efficiency by six times. FairPrice aims to have 15 stores equipped with SCO and 100 stores equipped with ESL systems by the end of this financial year. It currently has six and 29 stores equipped with SCO and ESL systems.
At the supply-chain level, FairPrice has invested in a new high tech distribution centre which will include the latest technologies like automated stacker cranes and robotic technology for warehousing operations. This highly automated system which combines the Retrieval System and the Caddy Pick system with Automatic Storage, is the first of its kind in the Asia Pacific region – will be able to handle up to 10,000 cartons per hour. This is 25 percent faster that the current system. This distribution centre will be operational in the later half of 2014.
To combat fluctuating food supply and prices, FairPrice will continue to further diversify its food sources and engage more contract farms to ensure price stability. FairPrice currently imports from over 70 countries worldwide and engages over 80 contract farms to ensure consistent supply at pre-agreed prices.
Commenting on the challenges ahead, Mr Ng said, “FairPrice will continue to serve our customers and the community with a heart, and be Singapore’s homegrown retailer that we can all be proud of. We have overcome many challenges to reach this momentous milestone and we can expect to face many more challenges in the years ahead. But we are confident that with sound management, prudent planning and efficient operations, we will be able to continue to fulfill our mission of moderating the cost of living for Singapore and enhance the life of workers.”