I know this Singapore supermarket chain for a long time.
This outlet sits in the basement of one of the newer shopping malls in Singapore, in the KINEX mall. Basement.
I was told that this supermarket generated a loss of more than one million SGD per year, which translates to more than 100k SGD per month.
The manager told me that they have 18,000 sqft at 5 SGD psf. Utilities are 20k SGD per month. The payroll is 80k SGD per month.
He said that they would need revenue of 1 Mio SGD per month in order to survive.
Everyone else is responsible for that loss: Two wet markets nearby. The nearby Tanjong Katong Complex with a competitor supermarket. The new built Paya Lebar Square, and many others, which are two blocks away. Nobody comes to the KINEX from there. There are HDB nearby which do not show up. And landed houses. Only 160 apartments in the KINEX.
Breaking down these numbers, a different picture becomes visible.
The monthly revenue was 900k SGD per month, which translates to 30k SGD per day.
Assuming a purchase value of 100 SGD per basket, this translates to 300 customers per day. They are open from 8am to 10pm which is 14 hours.
That is 30 customers per hour, maybe 60.
what was required was 10% more customers, which is 3 or 6 more customers per day.
Given the good name of the supermarket chain, this should have been easy.
And why did they drag this on for 5 years?
And the landlord is not to blame. Even if the rent would have been free, instead of 90k SGD, this outlet would not have been profitable.