\n<\/p>\n
Even with favourable business structures, stores must still attract footfall and repeat purchases, said Singapore Management University\u2019s associate professor of marketing education Seshan Ramaswami.<\/p>\n
“In retailing, the specific location is really important. Not just the general location, especially in a crowded shopping environment like Orchard Road,” he said.<\/p>\n
Takashimaya and Tangs occupy prime positions in Singapore\u2019s busiest, highest-spend retail corridor, ensuring steady flows of affluent locals and tourists that cushion weaker trading periods, the experts pointed out.\u00a0<\/p>\n
Tangs’ VivoCity outlet benefits from a huge catchment area and direct links to Sentosa, cruise terminals and ferry traffic. \u00a0<\/p>\n
“These locations capture tourists, office workers and high-income local residents in one node,” she said. “In that context, the department store is not just a ‘big shop’, but an urban anchor for an entire cluster.”<\/p>\n
Yet proximity to success does not guarantee it. Isetan and Metro both maintain Orchard Road stores, but with markedly different results. Isetan operates in Shaw House and Wisma Atria, both with direct MRT access. Metro sits in Paragon, a luxury mall opposite Ngee Ann City.<\/p>\n
Not all Orchard Road addresses are equal, said Knight Frank’s Mr Hsu. Visibility, the mall’s tenant mix and the department store’s location all matter significantly.<\/p>\n
“Having an Orchard Road address helps, but it\u2019s not a silver bullet,” he said.<\/p>\n
Prof Lee noted that Metro’s outlets are “typically mid-sized formats” embedded in larger malls where landlords control the overall concept and tenant mix. “The department store is one anchor among many, not the ‘spine’ of the asset in the way Takashimaya is for Ngee Ann City,” she said.<\/p>\n
The compatibility with surrounding tenants is another factor, she added.\u00a0<\/p>\n
Paragon\u2019s upper floors cater to luxury brands and medical specialists, putting pressure on a mid-market department store to justify its footprint against higher-rent specialty tenants.\u00a0<\/p>\n
Isetan\u2019s stores tend to carry more generic mid-market merchandise that overlaps with other mall retailers and online offerings, resulting in weaker differentiation and synergy, Prof Lee said.<\/p>\n
Isetan’s and Metro’s suburban outposts \u2013 at Nex in Serangoon and Causeway Point \u00a0in Woodlands respectively \u2013 are “double-edged swords”, experts said.<\/p>\n
While these locations are frequented by loyal neighbourhood shoppers, those customers are typically more price-sensitive. Competition from supermarkets, discount chains, specialty shops and e-commerce is intense, Prof Lee said.<\/p>\n
“The average basket size and willingness to pay for premium brands are usually lower than in Orchard or VivoCity,” she said.<\/p>\n
At the same time, heartland malls increasingly allocate space to F&B, enrichment, healthcare and services that cannot move online as easily. Rising rents make large, multi-level department stores harder to justify.<\/p>\n
The closure of Isetan Tampines reflects this broader reconfiguration of heartland retail space, Prof Lee said.<\/p>\n
Mr Hsu pointed out that while heartland stores may benefit from lower rents, reduced footfall and sales density \u2013 the amount of revenue generated per square foot of retail space \u2013 means these outlets are unlikely to compensate for underperformance at flagship locations.<\/p>\n<\/div>\n