Mr Lau and Ms Mah, the husband-and-wife owners of The Skin Pharmacy, at their branch in nex shopping mall. They will be closing their City Square Mall branch as the landlord there is asking for a four-fold increase in rent. Mr Lau is hoping for rent control laws as they will help control rent increases. -- ST PHOTO: LAU FOOK KON
Squeezed by rental and transport costs
Lau Min-Tsek and Mah Mei Hui
Owners of The Skin Pharmacy
The husband-and-wife team founded the firm, which specialises in skincare and skincare products, in 2009.
The Skin Pharmacy has three shopping mall outlets - in City Square Mall, nex and Parkway Parade. Another outlet will open in May at Jem. The chain has 15 staff, including the bosses.
Their main issues
RENTALS are a headache, with contracts often factoring in a yearly increase as well as a percentage cut of sales. The problem is exacerbated when the lease is up for renewal.
The Skin Pharmacy's landlord at City Square Mall had asked for a four-fold increase in rent which Ms Mah, 40, said is "far greater" than projected sales growth.
"We have no choice but to move out of our first outlet at City Square Mall when our lease ends in March," she said.
Transport costs are also an issue. The firm's two vans are more than 10 years old, meaning higher maintenance costs and more breakdowns. But it is difficult to afford a new van with the sky-high certificate of entitlement (COE) prices even for goods vehicles.
Staff costs are less of a bugbear. "(We) are still growing and we can manage our overhead and rental costs without underpaying our staff or relying excessively on foreign workers to lower our cost," said Mr Lau, 42.
What they hope to get
The company is not looking for grants, said Mr Lau. "You need to spend to save (with the grants)... We have learnt that to survive, you cannot rely on the Government for handouts."
But the Government can help by relooking COEs, especially for vans used commercially. "Does the Government want to add to production costs when it is really the private consumption of private cars that needs to be penalised?"
Rent control laws will also help. These will help control rent increases. Mr Lau said such laws exist in many countries and some degree of legislation may be timely.
