SDP's worst fears about Sheng Siong come true

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Thursday, 25 March 2010

The inevitable has happened. Supermarket chain Sheng Siong is increasing rentals by an incredible 30 percent for its stallholders in five wet markets from next month. Singapore Democrats

The inevitable has happened. Supermarket chain Sheng Siong is increasing rentals by an incredible 30 percent for its stallholders in five wet markets from next month (see report below). The wet markets were bought over by Sheng Siong recently against strong protests by both residents and stallholders.

The Singapore Democrats voiced out strongly against the move precisely because we were concerned that Sheng Siong would hike rentals for stallholders. Our worst fears have been confirmed.

Despite the serious objections, the HDB allowed the sales of the wet markets in Choa Chu Kang, Bukit Batok and Serangoon to go through. In particular, stallholders at the Fajar Market in Bukit Panjang with the support of residents in the area appealed to their PAP member of parliament Dr Teo Ho Pin to stop the sale, but to no avail.

The SDP, which had contested the Bukit Panjang constituency in the last general elections, wrote letters asking for meetings with both Sheng Siong and Dr Teo to highlight the plight of the residents and stallholders but was stonewalled.

In fact a number of stallholders at Fajar Market, expecting the obvious, have already given up their stalls. Now the place is almost half empty, causing great inconvenience to housewives who frequented the market for fresh produce and meats.

Many remaining stallholders in the affected wet markets feel that the 30-percent increase is exorbitant, and a few said they may even give up their businesses.

The Singapore Democrats suspect that Sheng Siong is raising its rents by such a shocking rate in order to chase away stallholders. It may then re-negotiate with the authorities to allow the company to turn the wet markets into a supermarket.

Currently, they pay about S$2,000 to S$3,000 in rent. Obviously, the increase in rent will be passed on to the customers who are already burdened with high cost of living, in particular the steep increases for essential food items.

The incident clearly shows the arrogance of the PAP Government in disregarding the needs of the people as well as the survival of small-and-medium businesses in Singapore.

The PAP system is clearly moving in the direction of supporting big corporations at the expense of the little guy.

Sheng Siong's move also shows the impotence of the PAP MP, Dr Teo Ho Pin, in representing the interests of the residents of the Bukit Panjang constituency.

The SDP will highlight this matter when it takes on the PAP in the coming elections. We will be stepping up our campaign in the coming weeks and months to garner greater support from the residents.

Sheng Siong rises rent at 5 wet markets by 30%
Sharon See
Channel News Asia
23 Mar 2010

Stallholders at five wet markets will have to pay 30 per cent more in rent from next month.

They have been informed of the increase by supermarket chain Sheng Siong, which bought the markets over from a private property developer late last year.

The five wet markets are in Choa Chu Kang, Bukit Batok and Serangoon.

Currently, they pay about S$2,000 to S$3,000 in rent.

Many stallholders feel that the 30-per-cent increase is too high, and a few said they may even give up their businesses.

Some are thinking of passing the costs to customers but are also worried that this would hurt businesses, especially in the face of competition from other wet markets and supermarkets.

Sheng Siong said it had no choice but to increase rental rates, as it had to pay bank interest fees, property tax and maintenance fees after buying over the five wet markets for about S$25 million.

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Comments (13)

Thu 25 Mar 2010 1:53 AM | AnnA

Hmmmm.. I can 'smell' fish here. Perhaps the tenants in future will be open for foreigners who wants to invest. It is cheap for this people who doesn't really know the true value of the literally Singapore market.... and a wet one indeed!

Bangla/Thai shops anyone?

Thu 25 Mar 2010 2:33 AM | | NissanViP

This part is very interesting;

>

Sheng Siong is as good as saying, sooner or later, you will have no choice but to acknowledge the increases.

Now the "painful" episode is finally here but it isn’t over it.

Since these people are unwilling to stand together with you (SDP) to prevent SS proceeding from taking over the wet’s market, it is incumbent on them to pay for their own stupidity.

I hope they don't even think of passing the additional cost to the consumer.

Either they absorb or shut down their businesses.

You – SDP have done your best, Salute!

Thu 25 Mar 2010 5:07 AM | April Fool

If Dr Chee is funded by foreigners, who is funding the foreigners ?

It's better to be funded by foreigners than to be funding them.

Thu 25 Mar 2010 8:53 AM | seebeng - Link between Sheng Siong and the PAP

In defending her story, the LHZB reporter said in her facebook that she was probing Dr Chee based on “rumors” of foreign funding.

In the same vein, is she or her colleagues in SPH prepared to "investigate" the persistent rumored link between Sheng Siong and the PAP?

Thu 25 Mar 2010 9:31 AM | BryanT - SDP Switching Lines?

Firstly, I agree that the increase in rental is extortionate.

Secondly, when SDP says that the "the place is almost half empty", I assume that it is referring to the number of vacant stalls (and not the level of patronage).

Then it is not only causing great inconvenience to housewives who frequent the market for fresh produce and meats. The situation will reach a stage when it becomes inconvenient to Sheng Siong's account book as well.

Sheng Siong will then either realise that it has overpaid for the purchase of the market lease, or that its rental rates are out of line ..... or probably both.

The financial lesson will be learnt and market forces will calibrate the prices of market leases more realistically in future.

Thirdly, SDP floats a conspiracy theory that Sheng Siong is using the "shocking rate in order to chase away stallholders" so that it can convert the place into a supermarket.

My point is this - if there is already a glut of supermarkets in the area, then Sheng Siong would be committing a big mistake to add one more. If it wants to set up one more, then it is because it assesses there to be a demand. From whom?... the aunties and machiks, of course!

Businesses are set up to serve the customers. If Sheng Siong does not know what the customers want, then it deserves to suffer the financial consequences. That is why businesses come and go everyday.

Is SDP pretending to be in the grocery business and to know more than Sheng Siong? Last heard SDP was (still) in the business of politics.

Of course, it might be timely for it to consider switching lines.

Thu 25 Mar 2010 12:50 PM | quantum

ByranT:
You have the propensity to turn every issue into an economic one. But do you know that in social science, you have to look into the political, philosophical, sociological, anthropological, ethical, psychological, medical, legal as well?
SDP is a political party and that is why it is looking mainly into the political aspect, which is the way it should be. If SDP thinks like you, then it should be switching lines.

Thu 25 Mar 2010 2:40 PM | Robox

I had absolutely no doubt that the predictions by the SDP in this matter would come true.

This is not any clairvoyance or precience on either the part of the SDP nor I; it's about the HEALTHY mistrust we have for the PAP and its various agencies coming in other guises.

To trust the PAP is to set ourselves up for failure and disappointment.

Stop trusting them, everyone. The PAP hasn't earned that right.

Thu 25 Mar 2010 3:08 PM | johntoh

"""........Firstly, I agree that the increase in rental is extortionate........"""

You agree that the rental increase is extremely expensive.
So what have you done to stop it from happening? Nothing? You didn't see it coming? Others did.
In that case, what are you going to do to help these stallholders now? I guess nothing too. Am I right?

So why don't you shut your gap and leave it to others willing to not only be a voice for these stallholders but also for the household "aunties and machiks" who are trying to stretch every dollar they have.

Thu 25 Mar 2010 10:11 PM | BoredAccountant

To BryanT,

You are apparently in the business of mischaracterizing and distorting the issue. In this case, your "straw man" argument on the alleged glut in supermarkets.

Where in the article does it say that there is a glut of supermarkets in the area? The excerpt from Channel News Asia talks about competition from other wetmarkets and supermarkets. But this is not the same as sayng that there is a glut. You can have intense competition and still earn an acceptable rate of return.

Fri 26 Mar 2010 12:47 AM | quantum

Do you think the PAP MP Dr Teo Ho Pin will sue the SDP for libel (saying that he is impotent)?

Sat 27 Mar 2010 3:28 AM | workingtoohard - what about the people NOW?!

would just like to point this out. as SDP quickly and conveniently places the blame on PAP, lets see what they are intending to do to help the citizens at loss, lets see... hmm... ah, found it!

"The SDP will highlight this matter when it takes on the PAP in the coming elections."

interesting how SDP intention is not to help the citizens right now this instant when they need it the most, but to let the citizens suffer for months to harness that rage till election so they are able to gain the support they need. somehow this does not sound like a party that is actually concerned about the citizens but more for their own self interest and success. seems SDP has nothing new to offer to the people afterall.

Sheng Siong's actions are definitely questionable. if it is indeed an attempt to exploit a loophole to meet citeria for supermarket, the more we need to appeal for HDB or PAP for that matter to step in just like how they stepped in to begin with to broker the initial deal and ensured that rents won't rise and wet markets will not be converted. just like this is SDP's worst fears, i am sure neither did HDB or PAP anticipate such an exploitation if it is indeed any. you can keep thinking PAP is the root of all evil, but that is not going to do any good for the common citizen as they continue to suffer from the possible injustice.

the problem here is Sheng Siong, not from an economical business standpoint, because as a business, they have all the right to do what they want, but from the agreement made when the deal was completed. the agreement that rents will not rise and wet markets will not be converted. that is the problem.

Sat 27 Mar 2010 9:53 AM | AnnA - workingtoohard

yu tork kok ah?

Sat 27 Mar 2010 5:23 PM | Seelan Palay - About the people NOW

Dear workingtoohard,

Other than bringing it up during elections, the SDP and other activists going down and getting feedback from and providing information to from the stall holders, writing to Teo Ho Pin and Sheng Siong.

There are also other steps that many groups including SDP are currently taking, but due to the repressive political climate, its best not be publish them all right away.