2.

FairPrice s roots go back a long way, to the late-Dr Goh Keng Swee, who urge
d the labour movement to set up cooperatives to improve the lives of its members
. In 1973, NTUC set up the supermarket cooperative NTUC Welcome. This was during
the OPEC oil crisis, when oil prices more than doubled and triggered sharp rise
s in food prices, so that at its peak, inflation exceeded 20% in one year.
3.
Welcome aimed to offer daily essentials at affordable prices. This was not
easy, because prices of items like rice could double in a month, making purchas
ing decisions very stressful. Part of the reason for the high cost of food was t
he inefficient supply chain. There could be five or six middlemen between the im
porter and retailer, and each needed to make his margin, his cut. Welcome did aw
ay with the middlemen to stabilise prices and curb profiteering. The union movem
ent and the Government chipped in. Unions provided seed capital, and members vol
unteered to help out in the stores after work. They also campaigned to sign up m
embers for Welcome, to give the co-op a solid and loyal base of customers. The G
overnment assured Welcome of a reliable supply of essential goods and countered
the threat of wholesalers who tried to reserve goods for their favoured provisio
n shops. The Government also provided important advice. Then-Minister Lim Kim Sa
n gave Welcome s first Chairman and CEO Dr Baey Lian Peck $250,000 and said keep pr
ices low, fight inflation, but don t lose money doing it! .
4.
In 1983, 10 years later, Welcome merged with the Singapore Employees Coope
rative to form NTUC FairPrice. Since then, FairPrice has never veered from its m
ission of keeping prices of essentials affordable. It has absorbed GST during ec
onomic downturns, helped its SME suppliers tide over financial crises, and offer
ed attractive discounts for its housebrands.
5.
In crises, FairPrice has provided Singaporean consumers with precious reass
urance and security. During SARS, FairPrice employees continued to do their jobs
despite the widespread fear and anxiety in the wider community. Several FairPri
ce employees in fact fell sick and had to be quarantined. Many others soldiered
on. As Mr Gerry Lee, who is MD of Business Groups, recalls:
Our customers still needed their groceries. We were not going to let them down. W
e had to assure our customers that the food we were providing was safe and that
they need not panic buy and overstock food.
6.
This episode is one example of FairPrice s dedication to its social mission.
FairPrice would not have succeeded for 40 years without competent management, d
evoted employees and trusted, reliable suppliers. I am happy to see many of you
here with us tonight. My warmest congratulations to you, the FairPrice family an
d to FairPrice itself on reaching this important milestone!
Meeting New Challenges
7.
FairPrice must continue to adapt to the changing business and social envir
onment.
8.
In 40 years, the retail landscape has completely changed. FairPrice is no
longer an upstart competing against provision shops or trimming inefficient supp
ly chains. Today, FairPrice is a major player in a far more competitive and dive
rse market. There are retailers catering to every customer segment, from Sheng S
iong and Giant at one end, to Jason s and specialty grocers at the other. Many con
sumers shop online for high-end produce from overseas retailers.
9.
With greater affluence, and rising expectations, Singaporeans now want to
shop in comfort. They expect not just basic essentials, but good service, fresh
produce and higher-quality food. They are widely travelled and more discerning.
Some customers want to know whether the milk is organic, whether the salad is bi
odynamically harvested or whether the steak came from a cow that was grass-fed o
r grain-fed.

10.
FairPrice has responded to these changes by expanding its distribution ne
tworks and product offerings. FairPrice stores offer much better shopping experi
ences. Cheers outlets in petrol stations and housing estates serve casual shoppe
rs. FairPrice Finest and FairPrice Xtra hypermarkets cater to a wider range of c
ustomers. I hear the experience in FairPrice stores is so good that newlyweds ev
en shoot their wedding photos in FairPrice!
11.
But despite these changes, FairPrice cannot forget that it still has a cr
itical social mission, and that is to reassure Singaporeans that they can get go
od quality groceries and essentials at affordable prices. Singaporeans may be mu
ch better off, and spend more on higher-quality products and the finer things in
life, but the cost-of-living remains a concern to many households. And one can
never predict when the supply of essentials may be disrupted, whether due to eme
rgencies such as SARS, or overseas incidents like the Thai floods in 2011, or so
me disruption in the global markets, such as happened to the rice business from
time to time.
12.
In these situations, FairPrice provides an important assurance to Singapo
reans that they will always have somewhere to turn to for their basic needs. By
diversifying its sources, FairPrice ensures a reliable supply of essentials shou
ld any disruption occur. FairPrice housebrands offer good quality products at af
fordable prices. By freezing prices of essential goods at critical moments, like
during the global financial crisis or the Thai floods two years ago, FairPrice
gives people comfort that they will not be victims of profiteering. That is why
FairPrice remains a co-operative after 40 years instead of having being sold or
listed, so as to uphold its social mission and links with the community.
13.
FairPrice must continue to do this and uphold this social mission even as
it adapts to the future. It must find new ways of cutting costs, and delivering
better value. It must harness technology to raise productivity and share the sa
vings with customers. It must continue to ensure a reliable and affordable suppl
y of essentials by diversifying its sources and stockpiling important products.
14.
FairPrice must also continue to give back to its members and the wider co
mmunity. FairPrice s social mission is one critical reason why it has become a va
lued part of our social landscape. I therefore welcome Mr Ng Ser Miang s announcem
ent that FairPrice will donate another $40m to its staff, members, the Labour Mo
vement and to its customers. This strengthens the social compact between FairPri
ce and the public, and sets the bar for social enterprises in Singapore. It is a
lso an important draw for younger employees who want to work in an organisation
that is a responsible corporate citizen.
15.
At the same time, what Mr Lim Kim San told Dr Baey Lian Peck years ago st
ill holds: Do well, keep costs low, don t lose money . FairPrice has to stand on its
own feet and compete fairly with other commercial entities. FairPrice is not a
charity; it is not a food bank. This makes FairPrice s social mission particularly
challenging, and its success that much more remarkable. That is why FairPrice m
ust always be managed professionally, with strict financial discipline and sound
business practices.
CONCLUSION
16.
In a world where income distributions are widening and trust between busi
nesses and workers is eroding in many countries, NTUC FairPrice can stand tall a
s a social enterprise that has served its members well and forged strong ties wi
th the wider population. It has grown from humble beginnings into one of the lar
gest grocery retailers in Singapore, while maintaining its mission of keeping pr
ices affordable and giving back to the community. As the backdrop says, FairPric
e has always been For the People, From the Heart . I am confident that FairPrice wi
ll continue to uphold its social mission and strengthen its community links for

many more years to come.

17.
Once again, my warmest congratulations to FairPrice, and to all of you, h
ave a very good evening. Thank you very much.