The upcoming Johor Bahru-Singapore RTS Link is set to revolutionize cross-border travel and spending, with an estimated $1.05 billion increase in Singaporean spending in JB annually. This projection, from a joint study by the Singapore Business Federation, Restaurant Association of Singapore, and Singapore Retailers Association, highlights the potential impact on consumer behavior and business competitiveness.
The Impact on Consumer Spending
The study predicts a significant shift in consumer spending patterns, with Singaporeans projected to spend nearly 40% more across the Causeway once the RTS Link opens in January 2027. Currently, Singaporeans spend around $1.7 billion in JB, while JB visitors spend about $1.3 billion in Singapore. The study estimates a 51% annual increase in Singaporean consumers crossing over to JB, with groceries, pharmaceuticals, dining, and beauty services topping the list of spending categories.
On the other side, JB respondents expressed their intention to visit Singapore, with 34% planning to do so once the RTS Link is operational. Public transport users are expected to increase their annual visits by an average of 57%. Interestingly, visitors who drive to Singapore are also considering switching to the RTS Link, particularly for overnight stays and entertainment spending.
Concerns and Opportunities for Businesses
The study also sheds light on the concerns and opportunities for businesses in Singapore's retail, F&B, and wider business ecosystem. Businesses are worried about intensified competition from JB, especially in price-sensitive segments like groceries, pharmaceuticals, and beauty services, where lower cross-border prices already influence consumer spending.
Beyond pricing, businesses believe they can differentiate through service quality, customer experience, and unique offerings. However, they face persistent challenges in manpower, compliance, and cost pressures, hindering their ability to innovate and scale. SMEs, in particular, are concerned about keeping up with larger operators and adapting to the changing landscape.
Despite these concerns, the projected increase in Singaporean spending in JB is seen as a small portion of Singapore's retail and F&B sector, which contributed about $16.6 billion to the economy in 2025. The study suggests that industry and the government should focus on growing local and tourist spending while helping businesses adapt and seize new opportunities.
Support and Adaptation for SMEs
The Singapore Business Federation, Restaurant Association of Singapore, and Singapore Retailers Association have proposed several measures to support businesses, especially SMEs, in adapting to the changes brought about by the RTS Link. These include expanding the eligibility and amount of existing CDC voucher schemes to support businesses exposed to outbound spending, such as pharmacies, convenience stores, and F&B outlets.
Additionally, developing more night-time events and offerings beyond clubs and bars, similar to the Singapore Grand Prix night race and Singapore Night Festival, could attract more visitors and boost spending. The study also recommends greater flexibility in foreign manpower policies to address the manpower constraints faced by businesses.
A Catalyst for Change and Collaboration
The RTS Link is seen as a catalyst for businesses to sharpen their focus and move forward. The Singapore Retailers Association, for instance, aims to nurture the entrepreneurial spirit of local retailers, especially in attracting young consumers who value uniqueness.
The study underscores the need for stronger collaboration among trade associations, landlords, tourism stakeholders, and government agencies to help businesses respond to changing consumer trends and increased cross-border connectivity.
Kok Ping Soon, CEO of the Singapore Business Federation, emphasized that the RTS Link creates opportunities for Singapore businesses to attract more visitors but also brings competitive pressure, especially for the retail and F&B sectors. He stressed the importance of building on strengths like quality, service, trust, convenience, innovation, and experience, but acknowledged the structural challenges businesses face.
Conclusion: Embracing Change and Opportunities
The upcoming RTS Link presents both challenges and opportunities for Singapore's retail and F&B sectors. While businesses may face increased competition and pressure, the study highlights the need for adaptation and innovation. By focusing on unique value propositions, enhancing service quality, and embracing new operating models, businesses can thrive in a more connected Singapore-Johor Bahru market.
As Ernie Koh, President of the Singapore Retailers Association, rightly pointed out, "We treat it as 'what opportunities can we have', not a fear of 'something is going to happen'. If we play it correctly, it will benefit us." The RTS Link, therefore, serves as a reminder for businesses to stay agile, embrace change, and capitalize on the opportunities that arise from increased cross-border connectivity.
