13 January 2009, 11am at Viet Lang Restaurant

Dear Editors and Media friends,

Thank you for taking the time to join us today. At this time last year, rising oil prices sent food prices soaring worldwide. Inflation started to climb. Consumers were increasingly concerned with rising food prices. To help customers cope with inflation, we extended our 5 percent discount scheme on 500 housebrand items four times till end March this year.

Then came the ‘rice crisis’. The global price of rice tripled and created panic buying of rice. To moderate rice prices, FairPrice held prices for as long as we could and was the first retailer to drop rice prices in June last year. Subsequently, other retailers followed.

In March, NTUC FairPrice Foundation was launched to further FairPrice’s philanthropic efforts in a more systematic, focused and sustainable manner. At the launch, FairPrice pledged to donate $50 million to the Foundation by 2018.

Towards the end of last year, the financial crisis in the United States resulted in a meltdown of the global financial system and a slowdown for economies around the world, including Singapore. 2009 will be a challenging year as we gear up to ride this potentially tumultuous time.

Amid this challenging landscape, NTUC FairPrice as a social enterprise is all the more committed to doing more for our customers, our trade partners, our staff, and also to the Labour Movement and help Singapore ride through this recession. I am pleased to share with you today how FairPrice will support our stakeholders this year.

Supporting customers during hard times

For our customers, we will stay true to our commitment in ensuring that essential goods will remain affordable, particularly for the lower-income families.

We announced in October last year that we will extend the 5% discount on 500 housebrand items till end March this year at an estimated total cost of about $7.5 million since it was launched in December 2007.

I am happy to announce that we will extend the discount scheme until December this year so that our customers can continue to afford daily essential needs.

For the budget conscious customers, they can look out for more than 100 basic items labeled as yellow dot items that will help them save up to 25 percent. We aim to double the number of yellow dot items to 200 by end March this year.

We also have a selected basket of 400 “Everyday Low Priced” (EDLP) items comprising top national brands that are priced at least the same or lower than other retailers.

We will continue to help customers cut their grocery bills through attractive rebates and linkpoints for members, good value promotions, and 2 percent discount for senior citizens every Tuesday.

We will rally our suppliers to join hands with FairPrice to help our customers. We will urge suppliers to drop prices as soon as commodity prices fall. This will in turn ensure a continued demand for suppliers.

Supporting trade partners – easing cashflow

Some of our SME suppliers may face cashflow issues during this period. We will introduce the SME assistance programme and set aside up to $2 million this year to help local SME suppliers manage their cash flow. The programme includes early payment terms, discount on listing fees and advertisements, and help to promote made in Singapore products. Details of the programme will be further discussed with our suppliers.

Building Loyalty and supporting our staff

We can help our customers only if we continue to do well. To do well, we need a team of dedicated and capable staff who share our objectives. We will focus our HR efforts this year on supporting our staff and building loyalty and capability. As one of Singapore’s largest employers, we will not retrench staff this year but will instead use this opportunity to train and upgrade their skills to prepare them for the upturn. We expect to open at least three new stores this year and we will hire new staff to meet our business expansion. We will also take advantage of the downturn to look out for new talents for succession planning.

In line with our promise to deliver great customer service, we will upgrade the skills of our frontline staff so that we can serve our customers better. We will invest some half a million this year on core customer service training programme. By the end of this year, some 5000 frontline staff will complete this programme.

Our hardship grant and salary advance scheme provides financial relief to help staff to tide through the recession. Every year, FairPrice also gives out half a million dollars worth of study grants to enable children of staff and Union members to continue their education.

Supporting the labour movement

Being an NTUC Cooperative, it is also our responsibility to support the labour movement especially in the coming year.

Last year, FairPrice supported NTUC with $4.2 million of funding including a donation of S$3.5 million to NTUC to help low wage workers cope with rising food costs. This year we will give at least 50 percent more to NTUC to help workers ride through the recession.

Union members also enjoy rebates and dividends when they shop at FairPrice. Last financial year, FairPrice gave out $28 million in rebates and $9 million in dividends to its members.

To support NTUC Link in providing many benefits to union members, FairPrice rewards Link cardholders with attractive Linkpoints. Every year, FairPrice contributes more than $10 million worth of Linkpoints, the highest contributor to NTUC Link. Over the years, FairPrice has given out $36 million worth of Linkpoints to union members.

FairPrice Foundation continues to help provide a better life for the community

The needy and underprivileged will need more help during the economic downturn. FairPrice will do more for this segment of the community in 2009. Last year alone, the newly inaugurated FairPrice Foundation contributed S$6.7 million to the community. This year, the Foundation will contribute at least 20 percent more to the community.

The Foundation will also continue to support the various CDCs with the FairPrice Food Voucher Scheme to help needy families meet their essential needs.

Conclusion

Today, we unveil the FairPrice’s plan to support our stakeholders during this downturn. This plan will cost FairPrice about $15 million in total. The package reaches out to different segments in the community. For our customers, we will ensure that essential goods will be affordable through the 5 percent discount on housebrand items and some 100 yellow dot items. We will build staff loyalty and support them in weathering the storm through financial assistance, job assurance and skills development. For our SME suppliers, we will help them deal with cash flow problems through shorter payment terms, joint promotions and discount on listing and advertising fees. As a cooperative, we will support the labour movement to do good together. FairPrice Foundation will do more for the needy and underprivileged to help them ride through the difficult time ahead.

The challenging year ahead reminds us of our social mission to moderate the cost of living in Singapore and our vision to be the retailer with a heart. As the trusted supermarket for more than half a million members, we believe we can all join hands to help each other emerge stronger in the upturn.