If the capacity of car parks at malls are anything to go by, the decline in retail seen during Singapore’s circuit breaker is moderating, says DBS Group Research. Analyst Derek Tan writes of a “reversion to mean” as consumers head back for “revenge shopping” in a September 7 note, though returning shoppers are showing changed habits.

Singapore’s July 2020 retail sales declined by 8.5% y-o-y, though retail sales are up 27.4% m-o-m, following the easing of lockdown measures in June. Notably, the proportion of online sales fell in July to 11% from 18% in June and 25% in May, as Singapore entered Phase 2 of its circuit breaker.

“While the ‘new normal’ [in the proportion of online sales] may be higher than the historical average of 5-6%, we believe that the pace of recovery within the brick-and-mortar shops will increase at a faster rate compared to online sales which is expected to remain at current levels or even decline,” writes Tan. 

Tan expects the F&B and services sector to lead the recovery, and calls attention to August figures. “We reckon that declines could further narrow and turn higher (or even positive) in 4Q20. Our discussions with various landlords have confirmed this trend (for now).”

See: Singapore's retail sales remains in the red in first full month after circuit breaker

Consumers are now more “targeted” in their purchases and tend to spend a shorter time at the malls lingering and window shopping, write Tan, with the exception of couples who are out to spend some time together, based on personal observations.

Car park data showed a slight uptake in vacancies island-wide, writes Tan, led by Marina malls (57%) and Harbourfront (24%) in the past weekend.