Legal-Political
Singapore imports most food products and other merchandise from its regional neighbours and from many countries worldwide. Although the food retailing sector is not as developed as Australia or Japan, it enjoys minimal bureaucracy, limited corruption, conductive regulatory environment and a highly educated work force. In addition, Singapore offers advanced physical infra-structure and the small geographical size offers relative ease in distribution to reach the end-consumer market. This is evidenced in NTUC FairPrice capitalising on this strength with 252 outlets (as on end 2011) in multi retail format strewn in HDB heartland, offices, petrol kiosks and even prime districts to reach consumers of all income level groups with different needs.
In 1993, the 3% Goods, Service & Tax (GST) on all goods was levied by the Singapore government. A year later in 1994, NTUC FairPrice responded to this political environment change by absorbing GST in its business operation to help consumers offset cost. It also introduced a basket of Everyday Low Price (EDLP) essential items that are equal or lower in price than competitors to retain customers loyalty and attract new businesses.
In 2004, Avian flu hit Asia resulting in governmental import ban and eggs shortage. NTUC Fairprice reacted to this threat by collaborating closely with suppliers to normalise prices. It also brought in