By Ho Lian-Yi

A SINGAPOREAN businessman thinks the best way to target Singapore shoppers is to set up shop in Malaysia.

That's what Mr Dennia Tan, 36, did when he opened Regal Classic, specialising in Indonesian furniture in Danga City Mall, which is about 3km from the new Johor Customs, Immigration and Quarantine (CIQ) complex.

'We target Singaporeans because of their taste,' he said.

He saw the opportunity when he discovered the Johor mall would have a shuttle train stop connected to it. A one-hour train ride from Tanjong Pagar would take people straight to the mall. The return ride costs RM3 ($1.25).

It's not only Mr Tan who is looking for Singaporean customers. About 5 per cent of Danga City Mall's tenants are Singaporean and they have received more inquiries from Singaporeans lately, according to the mall's event and promotion executive Ms Mac Chong.

Mr Tan has two other shops in the mall, one selling decorations and the other swave boards (a kind of a cross between a skateboard and a wakeboard).

He said his parents owned a renovation company in Singapore. But five years ago, they moved their office to Malaysia. The reason: The rental here was too high.

Prime Orchard Road rents were $36.10 per sq ft per month (psf pm) in the last quarter of 2008 and prime suburban rents were $29, according to a Business Times report.

In 2004, prime Orchard Road rents were $32.40 psf pm while suburban rents were $26.60.

At Danga City Mall, the rent is RM8 ($3.30) psf pm to RM2.50 at the higher floors.

Mr Tan said the rent he pays for all three shops is RM14,000 in total. 'That's cheap!' he said.

Although based in Malaysia, Mr Tan's parents continued to work in Singapore. Mr Tan stayed behind as a site coordinator for the renovation company until he too decided to move to Malaysia two years ago.

He admits that Danga City Mall is not the right place to set up a furniture shop.

He said many of the residents in the area are those from other parts of Malaysia who have rented homes there to travel to Singapore to work.

This means that they have no incentive to buy furniture for their temporary homes.

His furniture, too, is on the higher end. A king-sized canopy bed, for example, can cost up to RM5,000.

Lower prices

But he claims that the prices are still much lower than furniture of equal quality in Singapore.

He's betting on that to draw customers to his shop.

'What can you get for $10,000 in Singapore? Over here, that's RM24,000. You can furnish an entire house,' he said.

He has two other Regal Classic outlets in other malls in Malaysia. Mr Tan said that he will ship furniture to Singapore for a fee.

Business, though, has not been great.

When the train to Danga City Mall on the Keretapi Tanah Melayu (KTM) railway opened on 5 Jan, it was plagued by delays, leaving passengers frustrated. There were also complaints that the trains on the schedule were too few.

The mall opened last August, but a quarter of the shops are still vacant.

Last Sunday, the mall did not seem crowded even after the train disgorged a long line of Singaporean and Malaysian shoppers at the doorstep of the sprawling seven-storey mall.

Shoppers told The New Paper On Sunday that they were generally underwhelmed by the lack of people and atmosphere even on a Sunday afternoon.

Business could be better, Mr Tan admitted. 'I still can survive but (sales are) not to our target yet,' he said.

However, he remains upbeat. Referring to the sparse crowd, he said it is common for Malaysian malls not to be packed, unlike Singapore.

He expects it will take half a year before business picks up.

Currently, he said 40 per cent of his customers are Singaporeans, with locals making up the rest. He hopes the ratio will become 50-50.

Local shopkeepers have also benefited.

Mr Dennis Chong, 40, a Malaysian, sells posters and collectibles at his shop, Wumeng Enterprise.

He moved from Holiday Plaza, approximately 5km north of Johor Baru, to Danga City Mall four months ago. He said that in the past, only 10 per cent of his customers were Singaporeans. Now they make up half of his customers. His business is also up by 30 per cent.

'Lots of new people get to know me. Like you, a first-timer,' he said, beaming.

But for Mr Tan, who still returns to his Singapore home every other week, has no plans to stay in Malaysia permanently. He plans to expand his business back home eventually.

'But I must make sure the business in Malaysia stabilises first,' he said.

Top photo: WORSE THAN MRT? The rush for the 8pm train at Danga City Mall. The shortage of trains is a big minus for the new shuttle.

This article was first published in The New Paper on Jan 18, 2009.