Fresh, niche and here to stay: Singapore’s gourmet grocers adapt to changing tastes

CHALLENGES IN A TIGHT MARKET

Even successful players are not having an easy time. At Ryan’s Grocery, rental costs have jumped 16 to 17 per cent, Ms Foo said. 

It is trying not to pass on the cost to customers, but margins are tight. “Now it’s not about profit,” the 58-year-old said. “It’s about trying to maintain the business and seeing what’s next.” 

Customer retention is another challenge. “My customers are well-travelled, more knowledgeable on the food they want to consume,” said Ms Foo. “Because they’re well-travelled, they’re hardly in Singapore.”

Anna’s Gourmet faces similar issues. “Singapore is a place where expats come and go … so they buy a certain time from you, but then they leave. And then the challenge is to get those new customers again,” Ms Jaeger said, adding that her priority is to attract more local shoppers. 

Global disruptions also pose a challenge to logistics. The Israel-Gaza conflict recently delayed shipments from Europe, forcing Anna’s Gourmet to switch to costly air freight.

As Little Farms grows, it has gained “a bit more purchasing power”, Mr Stevens said. “We’ve been able to negotiate better buy prices from our suppliers … and we share some of those benefits with our customers.” 

The brand has also evolved beyond premium-only pricing, with a tiered price approach of “good, better, best”. 

Mr Steven said the company is confident that demand for natural and organic food will continue to rise. “We see ourselves doubling our footprint over the next five years,” he said. 

Associate Professor David Gomulya of Singapore Management University said the key for gourmet grocers is differentiation.

If their offerings are too similar to traditional supermarkets, they lose their edge, he said. But if they can carve out a clear niche, customers would be willing to pay more.

“What is the alternative? (Customers) cannot import by themselves,” said Assoc Prof Gomulya, who teaches strategy and entrepreneurship at the university. 

In a retail landscape defined by change, gourmet grocers that adapt smartly may well endure.

If they disappear, “people will feel a loss … more than say, the disappearance of a generic supermarket”, said Assoc Prof Gomulya. “People will miss them.”