BHG downsizes Bugis Junction flagship outlet as department stores face shaky future
This follows the March closure of its Junction 8 store, which will be replaced by home furnishings brand Nitori. Nitori will also take over the third-floor space BHG used to occupy at Bugis Junction.
The scaling down of BHG's Bugis Junction outlet comes on the back of other store closures. Besides Junction 8, it has shuttered four stores here since 2022, in Raffles City Shopping Centre, Jurong Point, Clementi Mall and Lot One.
It follows a series of other closures of large department stores here.
'BHG remains a tenant at Bugis Junction on Levels 1 and 2, and we continue to work closely with them to introduce new brands,' said a spokesperson for Bugis Junction. BHG declined comment.
In February, BHG opened a pop-up store at The Centrepoint, which will operate until August.
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BHG Singapore began in 1994 as Seiyu Wing On Department Store. In 2007, it was acquired by Beijing Hualian Group, one of China's largest commercial chain retailers, and has operated under the brand name BHG for the past 18 years.
Homemaker Brenda Thio, 53, said: 'It is sad that these stores that have been around for so long are either gone or downsized.'
But she said she mainly shops online now. 'I hardly shop at BHG and have bought only pillows, bolsters or bed sheets there once every few years.'
A broader trend of decline
Large department stores here and worldwide have faced decline owing to increasing competition from online shopping, exacerbated by the Covid-19 pandemic.
Japanese chain Isetan will shutter its Tampines Mall outlet in November, after about 30 years.
At its 2013 peak, it had six stores in Singapore. Its last closure was Isetan Katong in Parkway Parade in 2022. After closing the Tampines store, it will be left with two outlets – Isetan Scotts and Isetan Serangoon Central.
Home-grown department store OG closed its Orchard Point store in 2022, after 18 years. Its remaining stores are in People's Park and Albert Street.
Metro closed its flagship Centrepoint store in 2019 after five years, with two remaining stores at Paragon and Causeway Point.
And two department store chains which used to be household names have called it quits. Robinsons, which still has an online store, shut its last physical store at Raffles City Shopping Centre in 2021, while John Little exited the local retail scene in 2017, after closing its Plaza Singapura outlet.
Market observers said that with e-commerce offering a greater variety of products, competitive pricing and the convenience of home delivery, people are increasingly less inclined to visit large department stores.
'Today's shoppers increasingly seek personalised, curated and experiential retail experiences,' said Leung Sau Yee, senior lecturer at Singapore Polytechnic's School of Business. 'Traditional department stores, with their generalist, one-size-fits-all model, often fall short of these expectations.'
Many department stores also rely heavily on mall operators to drive engagement, she said. Without distinctive products, brand curation or compelling in-store experiences, they struggle to offer shoppers a strong reason to return.
Department stores have traditionally been anchor tenants in malls. But operating large-scale stores in prime retail locations, such as Bugis Junction, means incurring high rental, staff and inventory costs. As footfall declines, it becomes increasingly difficult to justify maintaining such expansive physical spaces from a profitability standpoint, experts said.
Associate Professor Lau Kong Cheen, head of the Singapore University of Social Sciences' marketing programme, said department stores have been supplanted by large malls that offer a curated mix of specialised outlets. In short, malls are mega department stores.
'Malls house dedicated retailers for categories such as footwear, cosmetics, skincare, fashion apparel, accessories, jewellery and homeware,' he said. 'Each speciality store provides a focused brand experience that resonates more with today's discerning shoppers.'
Professor Lawrence Loh, from NUS Business School's department of strategy and policy, said: 'Department stores cannot continue to be more of the same, providing huge varieties for all customers. If they are everything to everybody, they may end up as nothing to nobody.'
From product-centric to experience-centric
What could make the department store relevant again in a tough market?
Prof Loh suggested merging the physical store with a digital one to offer holistic shopping experiences that are not found online.
'The 'touch-and-feel' in shopping is still valuable, but stores must give sufficient incentives to prevent the undesirable consumer behaviour of testing at stores and then going online to purchase elsewhere at lower prices,' he said. 'Department stores face the real challenge of being free showrooms for the low-cost e-commerce stores.'
Other experts agree on the need to invest in omnichannel integration with a seamless blend of online and offline experiences, such as allowing customers to purchase online and collect in-store, or checking stock levels in real time, to compete with pure e-commerce players.
Ethan Hsu, head of retail at real estate consultancy Knight Frank Singapore, said that technology such as personalised apps, fitting rooms that use augmented reality and artificial intelligence-driven inventory can improve efficiency and customer experience.
They can also cater to modern preferences like sustainability, he said.
In addition, he suggested community marketing activities that can build loyalty and differentiate stores from online retailers. These include supporting local charities, or hosting community events and cultural celebrations.
Prof Lau suggested that stores frequently introduce thematic changes – for instance, cultural themes from different countries – to their product ranges.
'Just like museums and art galleries – they change their display by curating new exhibits to draw domestic visitors to make repeat visits,' he said.
Exclusive collaborations with brands that have a limited presence in Singapore – including emerging international brands and local designers – could help, Prof Lau added.
And stores can transform themselves into lifestyle destinations by integrating cafes with speciality in-house brews and food, and branded dining ware sold in-store, he said.
Offering experiences such as personal colour analysis, cooking or baking workshops and food-and-wine pairings can make shopping more engaging, and cannot be replicated by online retailers, said Leung.
She added: 'Ultimately, for department stores to thrive, they must shift from being product-centric to experience-centric, staying attuned to evolving consumer values and behaviours.' THE STRAITS TIMES
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