When Eugene Tay and Ben Lin started making cold calls to sell perfumes and skincare to earn extra pocket money, they did not expect their side hustle to grow into a full-fledged retail business.
From mainstays such as Estee Lauder, SK-II, and Hugo Boss to local brands like Iren Shizen, The Powder Shampoo, and Hegen, Novela has made its mark in ecommerce and the brick-and-mortar space with seven outlets to date.
Now, Novela is being compared to other beauty retail giants, such as Sephora, Olive Young, and Sasa, but getting there was not as glamorous as it seemed.
From a wholesaler to a retailer
For Eugene and Ben, who first met as classmates back in Temasek Polytechnic, business was smooth sailing as a wholesaler. They did not plan to enter the retail space until they were given an opportunity to sell their products at a kiosk in Suntec City in 2014.
“Instead of keeping our stocks in our warehouse, we decided to give it a try and sell them at the kiosk,” Ben added. Despite their enthusiasm, they were, in our opinion, unlucky with their timing.
He explained that when the company leased their kiosk, the mall was undergoing renovations, which took longer than expected. Even after renovations were completed, they incurred close to S$500,000 worth of losses due to low footfall and eventually closed the kiosk.
Despite these challenges, Novela has managed to recover from its setbacks, and it all came down to one simple solution—being able to be seen among the retail powerhouses.
The founders’ first step was to find a location that suited their brand positioning. After leaving Suntec, Novela opened its second store at outlet mall IMM in Jurong in 2016, which, according to an article by The Straits Times, was a better fit for the brand as a “premium beauty retailer.”
The brand attracted the attention of locals and mainland Chinese tourists who were shopping there, spurring the company to become an “early adopter” in using the Chinese messaging app WeChat to connect, engage, and build customer loyalty amongst Chinese expats residing in Singapore.
“They have continued to be our loyal customers, while our new brands and assortment have also brought in new and younger customers who look for exclusive and niche skincare and fragrance brands,” Ben added.
The second step, and the bread and butter of every beauty retailer, was to curate an assortment of “exclusive” brands, where the founders tapped into their knowledge of the market, competition, and trends to bring “unique” brands to be sold to the Singaporean market.
While it was challenging to generate brand interest as Novela had two to three stores and a small customer base initially, trust only grew along with the company’s exposure.
Eugene and Ben eventually established Henatenn Holdings in 2019, a beauty distribution and export group, and opened three more outlets: Northpoint City in Yishun, Singpost Centre at Paya Lebar (both of which have since closed in 2022 and 2024 respectively), and Yue Hwa building.
Costly mistakes
In 2020, the retail industry took a massive hit during the COVID-19 pandemic, which resulted in many notable homegrown and international brands shutting down their businesses, including Singaporean retail giant Robinsons.
But unlike their peers who solely pivoted their operations online, not only were Eugene and Ben able to launch their ecommerce site within a month, but they also made a gamble of opening three new Novela outlets, as they believed they could capitalise on the new availability of retail spaces.
However, this turned out to be a costly mistake.
While rentals were low, renovation costs skyrocketed due to the shortage of labour, and when these outlets opened in mid-2021, social distancing restrictions limited the number of customers allowed in-store and disallowed the use of testers, heavily affecting their sales.
However, this was just a minor hiccup, as market conditions improved post-pandemic, allowing the company to grow and have seven outlets to date across Singapore.
Growing the brand
Currently, Henatenn Holdings has brought in revenues exceeding S$100 million annually, and the business has improved since 2022 with the help of additional funding from investors.
Novela has since launched its latest niche fragrance concept—Scented Journals, at two of its newest outlets at Tampines 1 and Paya Lebar Quarter (PLQ) this year.
According to Eugene and Ben, the new concept was born to cater to customers who went from trying mainstream “trendy and popular” to high-end designer fragrances to scents that “reflected their individuality.”
Now that we have seven physical stores and [an] ecommerce [site], on top of a sizeable and loyal customer base, alongside upcoming expansion plans to Malaysia and SEA, it is easier to bring brands in. In fact, from the success we’ve had introducing new brands in Singapore, brands looking to expand into Singapore and the region have been reaching out to us to be their Go-to-Market retailer.
Ben Lin, co-founder of Novela
Both founders shared that they plan to open more stores locally, including a flagship store at a prime location.
More big plans are on the horizon, too, as the brand will be working to develop its in-house products and expand into the Southeast Asian region following the launch of its Malaysian ecommerce site in September this year.
- Learn more about Novela here.
- Read more stories we’ve written about Singaporean startups here.
Featured Image Credit: Novela