When news that local tweenage paradise 77th Street was closing down its last outlet broke, the comment sections on Facebook pages of news sites were hit with a wave of nostalgia:
In spite of the crowd it’s appealing to, the brand is already 28 years-old, and gauging from the crowd the news had elicited responses from, it does seem that its business model had aged with its fans.
At its peak, it had over 16 outlets islandwide, with the ‘coolest’ being at Far East Plaza, but it is now yet another teen-centric shopping haven which is past its former glory.
Founder Elim Chew has cited sky high rentals as one of the main reasons for closing:
“As the rental became higher and higher and higher, we find that we’re just working for the landlord to pay off the rental. (…) When I first started, (the rental rate) was S$9 per square foot, today it’s S$35 per square foot. So, you know, we decided that we shouldn’t embark into opening more shops.”
The concerns are not exclusive to her brand, with international brands like New Look and local niche brand Comics Connection closing their shutters due to high rentals and a generally poor retail market.
77th Street, The Street To Be On In The 90s
77th Street was a mecca for 80s/90s tweens and teens, who have memories of visiting the shop for secret ear-piercing sessions (I myself got 5 of my 8 piercings there in while still in my school uniform), edgy jewelry and street fashion items like ripped jeans and spiked belts.
The outlets were often purposefully dimly-lit, with intimidating-looking earrings and chains fronting the shop, giving an impression that only the kids who were ‘cool’ could enter.
Inside, customers could browse the various street-style clothes, bags and shoes that were being sold.
Teenage years are ones filled with desperate attempts to establish one’s identity, and with everyone wanting to be ‘cool enough’, its clandestine-yet-mainstream appeal worked.
Rise Of E-Commerce = Death Of Retail
When interviewed, Chew mentioned that e-commerce brought about a dawn of even cheaper alternatives for consumers, as they sell their products at “very, very low margins”.
Her story echoes that of other shop owners – the combination of rising rental and online rivals led to the painful, but inevitable death of retail.
The phenomenon is nothing new. In a study done on attitudes during online shopping among Singaporeans in 2002, it was reported that ” e-commerce activities increased from S$0.2 billion in 1999 to S$1.17 billion in 2000 and will reach S$2.75 billion in 2002″.
Another study in 2013 revealed that “Women and men ages 18 to 34 are more likely than 35 to 64 year olds to engage in nearly every online shopping activity, with 40% of males and 33% of females in the younger age group saying they would buy everything online if they could”.
The appeal of e-commerce is not simply in the lower costs.
In a recent PWC study asking nearly 23,000 online shoppers from around the world on issues relating to e-commerce, over 40% of Singaporeans stated that they shopped online because it was more convenient.
With items from all around the world being available at the tap of one’s finger, it’s no surprise that online shopping appeals to many who are craving variety, convenience and savings. Let’s admit it, who doesn’t want that?
Logistics The New Way To Go?
In her interview with Channel NewsAsia, Chew reveals that with the death of 77th Street comes another new venture – FastFast delivery, which was set up with 3 other associates. FastFast delivery provides package delivery services via a simple app interface and offers a delivery rider tracking service – very much like how we track our food deliveries and cab drivers.
“We found that actually, the logistics business is a better business, because every e-commerce business needs logistics.”
She’s not wrong.
While e-commerce businesses have the advantage of being immune to rental costs of physical spaces, getting their items out to the buyers is a hurdle they face if they don’t have an efficient (cost and delivery speed) and reliable logistics service to utilise.
E-commerce giant Amazon has also caught on with the importance of logistics, and earlier this year unveiled its plans of improving its in-house logistics.
The inclusion of cargo planes, trailer trucks, a China-US ocean freight forwarder and the increasing of Amazon warehouses are moves made to reduce its reliance on third-party delivery services like FedEx and UPS.
Analyst Colin Sebastian from Baird Equity Research also predicts that Amazon would eventually go head-to-head with current delivery partners, with their “cloud technology expertise and increasingly complex fulfilment” as their edge above the rest.
The global fulfilment market is said to be worth a whooping US$400 to 450 million, and it comes as no surprise that they’d want a piece of that pie too.
While powerhouses like Amazon are able to establish their own logistics systems, many in the e-commerce industry still require third-party services, and Chew’s FastFast delivery definitely aims to close that gap.
Elim Chew: “It’s Not Just About Making Money”
E-commerce is here to stay, and Chew’s tenacity and ability to let go of the old (77th Street) and embrace the new (FastFast) is something to admire and emulate.
Just like 77th Street and its impact on 80s and 90s teenagers, she hopes that her new venture would also have positive implications for those working for FastFast. “I want to make it a platform where people who need money can earn some cash while performing an essential service.”
She has also invested in three restaurants in the last two years (I’m KIM Korean BBQ, Kokomama and GoroGoro Steamboat & Korean Buffet) and recently launched a Youtube channel which features “people from different fields around the world who are making a positive impact in society through their work”.
She remains optimistic, and holds this wish even in the light of 77th Street’s downfall, which she said took up almost half of her life.
“For me, to live is about impacting people’s lives. I love people. I want to see people’s lives being touched and impacted. It’s not just about making money.” – Vulcan Post
Featured Image Credit: hnworth.com