Tourism, revenge spending boost May retail sales
Sales of clothing and footwear posted strong growths.
Total retail sales increased by 9.3% as of May 2022 year-to-date (YTD), on the back of revenge spending and the revival of tourism.
Clothing and footwear posted the most growth.
Data from Cushman & Wakefield showed that retail trades in apparel and footwear grew by 33.6% YTD, trade in department stores went up by 22.9% YTD, and watches and jewellery increased by 19.9% YTD.
It said online sales also reported growth but it remains a small proportion of the total retail sales at 15%.
With this, the analyst said retail sales are expected to recover due to the return of international visitor arrivals.
Despite this, Cushman & Wakefield said tourism recovery is still impacted by China’s zero COVID-19 strategies because Chinese tourists significantly contributed to Singapore’s tourism sector. In 2019, over 19% of tourist arrivals in Singapore are Chinese.
Meanwhile, as rents grow, manpower shortage, inflation and food supply disruptions impact food and beverage retailers, who are driving retail demand.
“Some retailers may not be able to fully pass on higher costs as consumers become increasingly price sensitive,” it said.
The reopening of borders may also lead some consumers to spend overseas, which could offset part of the growth from higher inbound tourism.