Challenger to close megastore at Funan DigitaLife Mall
SINGAPORE: IT and electronics retailer Challenger Technologies will close its 53,000 sqft flagship megastore at Funan DigitaLife Mall it said on Wednesday (Dec 10). This follows the announcement by CapitaLand Mall Trust Management (CMTL) that it will close the shopping centre for three years from the third quarter of 2016 for redevelopment.
The SGX Mainboard-listed Challenger said it will rely on a greater push towards a digital retail ecosystem and advanced software development initiatives for continued growth.
Chief Executive Loo Leong Thye said the shift in strategy for Challenger was in the works since 2009 when CMTL had indicated it would redevelop Funan. “We relocated our entire back office operations from Funan to our Ubi Link corporate building in 2009,” he said. This was followed by rapid retail expansion, with a total store count at 47 as of Dec 12, 2015 and three new leases confirmed for the first half of 2016," he said.
"The Group believes the impact from its megastore closure is significantly reduced to the extensive planning efforts over the last seven years," Challenger said in a press release.
"When we first listed on SGX in 2004, our Funan store contributed to 60 per cent of our total group revenue. As of the third quarter of 2015, this number is only about 20 per cent of our total group revenue,” Mr Loo noted. "Over the last seven years, many of our members and even tourists have also begun shopping at our heartland mall stores because of proximity convenience."
Challenger did not specify a date for the store's closure but said as of now, it would follow the mall's closure timeline.
Challenger said it restarted its retail e-commerce engine last year and has a mobile-first revamp coming in early 2016. It also announced its foray into a digital lifestyle ecosystem by establishing Challenge Ventures in the third quarter of this year to invest in digital businesses and services.
“We can stock 10 times more products online than at our megastore, creating a mega mall effect for customers to browse and transact on their mobile devices. We need to go where the customers are,” said Mr Loo. “Our physical retail stores will evolve to become more experiential, with our brand partners having better concepts to showcase their products’ capabilities."
He added that he has a "big sales target" of S$1 billion to be achieved in five years’ time.
- CNA/ly