CEO confident that investment in 100,000 sq ft outlet will pay off despite retail downturn
Australian department store giant Harvey Norman has expanded its presence in Singapore with a new flagship store in the Central Business District despite a downturn in the retail sector that has crippled many operators here.
The three-storey, 100,000 sq ft superstore, officially opened in Millenia Walk on Thursday, may seem a risky move but chief executive Katie Page shrugged off notions that she may be betting against the market odds.
"The retail business is competitive all the time, it didn't just start becoming challenging. We've been in this business for 32 years and there is not one year for me that hasn't been competitive," she told The Straits Times.
"You have to keep evolving your business, you have to make it appealing to your customers, give them an experience. You don't just open a store, not put in the effort like (the flagship store), and expect customers to shop with you."
The megastore, which has replaced Harvey Norman's old 45,000 sq ft outlet in Millenia Walk, is the largest homemaker department store in the CBD.
The expansion comes at a time when retailer businesses across Singapore are suffering from cut-throat competition, high operating costs and fragile consumer sentiment.
Well-known brands such as French retailer Carrefour and the Japanese fashion label Lowrys Farm have beaten a retreat from Singapore in recent times.
The challenge is also evident in Millenia Walk, with Japanese department store Parco shutting its doors in February last year.
But Ms Page stressed that she has no issue with the location, which was the site for Harvey Norman's first store in 2001.
She said the massive floor size is the strategic advantage she has been seeking for years in Singapore.
"We never had the space for furniture and bedding like we do now, and in Millenia Walk, we have the opportunity to show Singapore what the Harvey Norman brand truly is.
"So when some retailers say it's tough for them to do business, I say it's tough for us that we had not been able to show our full brand like we do in Australia or Malaysia.
"Having a flagship like this sets the brand, something you can't do online. You must have the physical space that tells the world what you're about."
Ms Page declined to reveal how much was invested in the new shop, saying only that it was a significant amount for which its return can be achieved "very quickly".
"We will know over the next six months where this store really sits within our group in business terms, but I am thinking that this will be as good as our No. 1 store in the world," she said.
Harvey Norman, which operates 15 outlets in Singapore, has included some novel features in the shop, including Singapore's first Fujifilm Wonder Photo Shop and the first Microsoft in-store outlet.
Ms Page added: "When I sat down with (Millenia Walk owner and) Pontiac Land's Kwee Liong Phing - a very good friend of mine - about 12 months ago to discuss our plans, we decided for it to be nothing short of the best homemaker department store in the world.
"This is our largest store in Asia and we want it to be our hub for the region. We've got 100,000 sq ft... right in the middle of the city centre. I don't think you will find that combination anywhere in Asia."