SINGAPORE - In 2019, supermarket chain FairPrice carried out its first major survey of consumers to find out where it stood among Singaporeans of different income groups, after growing talk that it had gone “atas” (Malay for posh) and strayed from its original mission of keeping prices affordable.

The survey came 12 years after the retailer launched its Finest store concept to woo affluent shoppers from rivals such as Cold Storage. The findings set off alarm bells.

Essentially, FairPrice had done well in gaining middle-income consumers, but lost ground among the lower-income.

The findings validated feedback from some customers who felt that FairPrice had moved away from its original heartland roots, and the situation needed to be fixed, FairPrice Group chairman Kee Teck Koon told the writers of a new book.

The Price Of Being Fair, edited by Sue-Ann Chia and Peh Shing Huei of content agency The Nutgraf, tells the story of Singapore’s top grocery retailer, charting its ascent, from the opening of the first store in Toa Payoh in 1973 to becoming a food enterprise with a turnover of $4.3 billion.

The book delves into the pivotal decisions the cooperative made, such as to enter convenience retailing in the 1990s, the “supermarket wars” with Carrefour and Sheng Siong, and how FairPrice contends with e-commerce and changing retail sentiments.

The book will be officially presented to Prime Minister Lee Hsien Loong on July 22 at FairPrice Group’s 50th anniversary celebration at the Sands Expo and Convention Centre. It was exactly 50 years ago on this date that then Prime Minister Lee Kuan Yew opened the first NTUC Welcome supermarket, later rebranded as FairPrice, in Toa Payoh.

In the book, FairPrice Group deputy chairman Seah Kian Peng and some labour leaders expressed concern that supermarket chain Sheng Siong may have usurped FairPrice’s place among heartlanders.

“If we win in serving the middle-and upper-income households, but lose our ground and relevance when it comes to lower-income households, we would have lost the plot and failed,” said Mr Seah.

To cater to the masses, FairPrice curated a basket of more than 500 popular daily essentials that it sells cheaper, as a whole, compared with its competitors. It also expanded its house brand range of products, which typically cost less than their branded counterparts.

With these initiatives, FairPrice has regained market share among low- to middle-income consumers, said FairPrice Group chief executive Vipul Chawla.

FairPrice also has to continually fulfil its mission of moderating the cost of living for Singaporeans.

When Mr Vipul was set to join the group in April 2022, he was told by a friend to “do something about eggs”. The first customer he spoke to also raised concerns about the soaring prices of eggs.

He realised that egg prices were up about 30 per cent in just a year, and that eggs – together with chicken, rice, noodles and toilet paper – are “lightning rod items”, as any price hike in these five key products will rile consumers.

He managed to pull in the crowds in January after stabilising egg prices, even though it became more expensive to buy them from suppliers, prompting his competitors to follow. An unnamed rival dropped its price for a tray of 30 eggs to $6.70, five cents below FairPrice’s. FairPrice had reprised its role of a price setter, as it did in the 1970s with rice.

With its scale, financial strength and social consciousness, and by ensuring that shelves are always well-stocked regardless of profit, FairPrice has helped to fight inflation and stabilise supplies on several occasions. These included during the avian flu outbreak in 2004, and the Covid-19 pandemic in 2020, which disrupted supply chains.

The book captures how FairPrice prevailed against French supermarket giant Carrefour, but of perhaps greater interest is the stratagems being used in its ongoing rivalry with fellow home-grown chain Sheng Siong, which has leapfrogged Cold Storage to become the second-largest supermarket chain here.

FairPrice uniformly prices its goods across all stores – even for FairPrice Finest. Sheng Siong, however, practises price variations depending on location and surrounding competition, giving consumers the perception that its prices are lower across all its outlets, said the book.

To spar with Sheng Siong, FairPrice stores near Sheng Siong outlets stock fresh produce with shorter shelf lives, which translate to lower procurement costs. The savings are then passed on to shoppers.

FairPrice has over 60 such “warrior stores”, specially chosen to compete with Sheng Siong with handpicked employees who relish being in the fray. The retailer has also unveiled stores resembling wet markets – with 80 per cent of inventory consisting of fresh goods – a direct answer to Sheng Siong’s signature focus on fresh produce.

When contacted by ST, Sheng Siong declined to comment.

Unlike its past and present competitors, FairPrice Group is not a company. It is a cooperative and social enterprise which maximises benefits for its members by putting social mission over money.

Over the last four years, FairPrice Group has given more than $787 million (or about $197 million annually) in the form of discounts, rebates and donations to its members, customers and the community.  Its members can receive special discounts and various rebates based on their spending in the form of Linkpoints, which they can then use to offset subsequent purchases.

“It is wrong to think that because you set out to do good, you should expect lower returns,” said NTUC Enterprise chairman Lim Boon Heng. “In fact, FairPrice should strive for the opposite. Because it sets out to do good, it should drive higher returns to spur the virtuous circle.”

NTUC Enterprise is the holding entity and single largest shareholder of the labour movement’s social enterprises, which include FairPrice.

The Price Of Being Fair will be available at all major bookstores from Monday at $29.90 (inclusive of GST). It will also be sold online at www.books.nutgraf.com.sg