[SINGAPORE] Long-established multi-sports retailer Royal Sporting House could be on its way out in Singapore, with storewide discounts of up to 70 per cent and staff indicating that at least four of its six remaining outlets are set to shutter in the coming months.
Once a retail giant with some 30 outlets at its peak, the sports giant is now a shadow of its former self, less than five years after its acquisition by Dubai-based GMG, which also owns Sun and Sand Sports (SSS).
Known for carrying athletic footwear, apparel and gear from brands such as Nike, Adidas and Reebok, the retailer now operates only six stores islandwide at the following malls: Bishan’s Junction 8, Serangoon’s Nex, Orchard’s Tanglin Mall, Jurong’s Jem, Changi City Point and Suntec City.
At around 10 pm, workers were seen entering the empty space with hand and power tools, laying plastic sheets across the entrance. The inside of the store has been gutted, its shelves and wall fixtures entirely removed.
A NEWSLETTER FOR YOU
Friday, 8.30 am
Asean Business
Business insights centering on South-east Asia’s fast-growing economies.
When BT visited its Jem outlet on Mar 22 and its Junction 8 outlet on Mar 24, shelves were plastered with bold red “sale” signs, including a large poster at the storefront announcing discounts of up to 70 per cent.
Storewide clearance deals were also in full swing, with offers of 30 per cent off for two items purchased and 50 per cent off for three.
According to sales staff, employees have been informed that the company will be closing its Jem and Changi City Point outlets in the coming months, while the Junction 8 and Nex outlets will shutter some time next year.
GMG did not respond to BT queries and repeated efforts to reach out to the company on the matter. Calls and texts to a GMG corporate brands and communications specialist, who was earlier responsive, have been left unanswered since the beginning of April.
BT understands from social media videos that Royal Sporting House’s outlet at Nu Sentral, a mall in Kuala Lumpur, has extended similar discounts as those seen in Singapore.
According to the store list linked on the company’s Instagram page as at Apr 15, Royal Sporting House operates six outlets in neighbouring Malaysia in the capital city of KL, Selangor, Pahang and Penang.
It is unclear if the apparent winding down of Royal Sporting House in Singapore reflects a strategic shift by parent company GMG towards consolidating and streamlining its sport retail portfolio around the SSS brand.
In with the new?
In 2020, when GMG acquired Royal Sporting House – marking its foray into South-east Asia – Dr Kapil Tuli, professor of marketing at Singapore Management University’s Lee Kong Chian School of Business, observed in a December 2020 report that the group could leverage the expanded store network to launch its SSS brand in new markets.
GMG currently operates more than 200 stores in South-east Asia alone since it started operations in March 2021, which is in line with its “ambitious” goal of 400 stores within the next five years, it noted in a Feb 12 statement.
Recall that the Dubai conglomerate’s home-grown brand SSS is the largest sports retailer and distributor in the Middle East, and launched its first SSS store in Asia at Singapore’s Raffles City in 2023, before opening two more outlets at Bugis+ and Westgate.
It has four SSS stores in Malaysia currently – in shopping malls Mid Valley, Pavilion Bukit Jalil, Pavilion Kuala Lumpur and The Exchange TRX.
GMG has plans to open 11 more SSS stores across South-east Asia by 2026 and “establish a robust regional presence”, it noted in the statement.
“These foundational steps laid the groundwork for GMG’s strategic focus on retail innovation and regional growth,” it added.
Financials from GMG Sports Sea – which is incorporated in Singapore and whose primary business activity is listed as the retail sale of sports apparel and equipment, likely to include the Royal Sporting House business – have showed that the company has been loss-making for several years now.
From the financial year ended Dec 31, 2020, up to the year ended Jun 30, 2024, the company racked up cumulative losses exceeding S$46 million.
One for the history books
Since it opened its first store in Lucky Plaza in the late 70s to much fanfare, Royal Sporting House has been a household name for many in Singapore.
The company’s stellar run began with the 1980s’ aerobics craze, The Straits Times reported in 2008, and continued with it scoring exclusive rights in 1987 to distribute footwear and apparel in Singapore, Malaysia and Indonesia for Reebok.
It listed itself on the Singapore Exchange in 2000, and was worth some S$34 million by then, before it delisted in 2010 following a takeover offer.
Then, in 2020, GMG bought Royal Sporting House from Emirati conglomerate Al-Futtaim – the parent company of department store operator Robinsons, which closed down the same year amid declining revenues.
The acquisition included Royal Sporting House’s operations in Singapore, Malaysia, and Indonesia, as well as in Hong Kong, Egypt, and countries in the Gulf Cooperation Council.
Burning out…
Retail operators in Singapore have not had it easy.
Plagued by soaring rents and shrivelling domestic consumption, several name brands have either shuttered some outlets or pulled out of Singapore completely.
Think the likes of cinema chain Cathay Cineplexes, upmarket restaurant operator Prive, Japanese lifestyle store Hands and Chinese fast-fashion retailer Urban Revivo.
Dr Samer Elhajjar, a senior lecturer of marketing at the National University of Singapore, pointed out that key challenges besetting the local retail scene include cost pressures, intensifying competition, shifts in consumer demand and preferences, as well as the current macro environment.
“It’s a competitive market, especially in sports. You need to create your own demand. You need to inspire people. You need to get them to feel the brand,” explained Dr Elhajjar.
“You need to build your emotional connection with consumers, so they can become loyal, and can frequently and repeatedly purchase your products.”
These are testing times for retailers in Singapore because they are not just competing against the digital realm but also against neighbouring Malaysia, said the marketing veteran.
Add to the equation a thriving discount outlet concept and the result is a cut-throat Singapore market, he added.
… or routine shake-out?
That said, Dr Elhajjar believes there is no cause for concern.
“In Singapore, we always go (through) ups and downs when it comes to retailing. It’s not a very stable market,” he said.
As far as the lecturer is concerned, the lesson to be learnt here is that retailers must be able to come up with a package to attract and communicate its value proposition to the local consumer.
“I don’t think we have to get worried at all. Consumer perceptions are very positive. Consumer confidence in the Singaporean market is very positive as well,” concluded Dr Elhajjar.
“If you don’t adjust, if you don’t adapt to the new dynamics in the market, you fail and you shut down – that’s the main outcome.”
