Sheng Siong needs to shop for new stores to fuel growth

NEW stores are likely to be a crucial growth driver for Sheng Siong Group, amid an environment of keen competition.

And while the jostling for space in the HDB commercial renting market has put a crimp in its growth efforts of late, it could be in a better position to expand in the second half of this year.

Bidding for sites has started to turn more rational, say analysts, after small supermarket and minimart chain operators made aggressive bids for sites in Q4 2016. One reason for this is that pricey rentals might not be sustainable for these smaller players, which rake in lower revenues and thinner margins than industry heavyweights such as NTUC FairPrice, Dairy Farm and Sheng Siong.