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Skp KThe FairPrice experience goes beyond buying groceries. It has become a regular family outing for many – from seniors having their regular outings to young couples taking their wedding shots as they had many memorable outings at their favourite FairPrice stores. And then there are also kindergarten teachers bringing their students to FairPrice outlets to learn about budgeting.

FairPrice outlets exist for many reasons, says CEO Seah Kian Peng. The NTUC FairPrice Co-operative, set up in 1973 to help moderate the cost of living for the man in the street, has become a household name and an integral part of the social fabric of Singapore. When there is a call for action to any crisis, the response from NTUC FairPrice Co-operative is telling. The stake the co-operative has in Singapore is high and deep.

When the government declared war against diabetes, NTUC FairPrice Co-operative was among the first to step forward in promoting brown rice through consumer education and offering financial incentives to make the switch from white to brown rice more appetising.

When the cost of infant milk was causing high level stress among anxious parents, NTUC FairPrice Co-operative quickly responded by introducing more options including its own house brand priced at a fraction of the leading brand and yet without compromising on quality.

We do well so that we can do more good.

As a measure to help alleviate the cost of living, NTUC FairPrice Co-operative donated $1.2 million worth of vouchers to more than 20,000 needy families this year. Since its launch in 2002, the NTUC FairPrice Food Voucher Scheme saw $16.8 million worth of grocery vouchers distributed to low-income families and individuals.

When the Pioneers Generation while appreciative of the 3 per cent discount they enjoy at all FairPrice outlets on Mondays, bemoaned that they sometimes missed out on the weekly FairPrice offers which start on Thursday, the CEO had his ears on the ground and responded.

In addition to Mondays, the Pioneers Generation shoppers also get to enjoy a 3 per cent discount on Thursdays and be the first in line to enjoy the FairPrice weekly offers. In 2017, Pioneer Generation shoppers saved more than $4.5 million. There is also the Seniors' Discount Scheme, which allows those above 60 years old to enjoy a 2 per cent discount on Tuesdays.

“We do well so that we can do more good. That has always been FairPrice's philosophy, a value system that we inculcate and it is a part of our DNA. The better we do, the more good we can do. Of course if you’re not set up as a co-operative or a social enterprise, then the more you do well, it is likely that only the shareholders will be enriched,” said Mr Seah.

So is it a liability to be a co-operative?

“I won’t call it a liability. I think we should use that to our advantage. It defines us. In our case, we have almost three-quarter million members. Are they a liability or are they an asset? Are you looking at it as half-full or half-empty?

If you think about it, dealing with 750,000 shareholders, can be worrisome. But, I look at them as an asset. They are our members. They are very loyal and a very reliable group of customers. As we serve them well, the bond we have with our members is deep. If you have a big customer base, that is an advantage. What you should worry is when you have a small customer base.

So the pertinent question is as a co-operative, how do we serve our members better?

In fact, we would like to have as many to be our shareholders. By joining us as a member, they also need to understand that we are a co-operative. You don’t come in hoping that your shares will go up in value. You subscribe for shares at par, and you redeem them at par. But, we have consistently been giving dividends and rebates to all our members. And, when you add it all up it gives a reasonable return. At the same time, you know you’re joining a co-operative that has a clear and distinctive social mission -- to make lives better for Singaporeans and consumers.”

I always said that in Singapore we are seen as the big boy, but if you were to look outside of Singapore, we are small. And Singapore is an open economy. Anyone can come in. So we have to compete by running the Co-operative professionally and efficiently.

Are you optimistic?

“By nature, I am an optimistic person but I am also a realistic person.

Optimistic because NTUC FairPrice Co-operative has a strong foundation and our footprint is wide. We cater to a big spectrum of consumers -- from young to old; and from the worker to the CEO. We have a variety of platforms to serve all of them.

Optimistic because we have a good team. And I have stakeholders who understand the situation and are supportive.

Cautious because the world is uncertain and there are many unknowns. I am cautious knowing that the pace of change will continue to intensify. When do you adopt this particular technology? At what cost? Is it going to pay off? And, if it’s not, what do you do? These unknowns will continue to evolve.

In this journey, we will go through ups and downs, a left-turn, maybe a U-turn, a right-turn. You must be able to bring your whole team along this journey. It calls for being adaptable, fast, and able to take calculated risks. I think if you’re always standing on the side and watching, you could just watch the world pass you by, and you’re not in on the journey.”

3 Tips on how to face this new world

Disruptions and start-ups are coming on stream fast and furious. The acceleration of technological progress can be unnerving for businesses. What does it take to compete in this digital age?

“1. You have to embrace it, but don’t go at it at all cost. When I talk about embracing, it is you making an attempt to understand what possible technologies are out there, how it can relate to your business, and how you can apply that to reap benefits for your business.

2. You can’t do this alone. You need a team and have a team that understands, and to come alongside you and be on the journey.

3. What is in it for the customers? You are embarking on all these upgrades to be more efficient. But in the end, it must translate to something. How does it lead to a better journey, and a better experience for your customers?”

You cannot run away from the value you are adding for your customers. Increasingly customers are looking for more than a transaction. The transaction must come with a great experience. Sometimes technology cannot replace the softer touches. Technology allows us to do our job better so that we can focus our time on serving our customers better. In the end, it must lead to a better outcome for the organisation, for your staff, and for your customers. And, if we are able to do it, I think we’ve got a winning formula.

Learning Tips

  • To compete on a level playing field and emerge as the leader, the co-operative must be efficiently and professionally managed
  • Leverage technologies to deliver value to members, customers and/or staff
  • Use social mission as a differentiator to energise and align your staff

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