Singapore saw 60K business closures in 2025—that’s the highest in 8 years

From retail to finance, operational challenges are cutting across every industry

Singapore recorded a notable increase in business closures in 2025, with more than 60,000 companies ceasing operations—the highest figure in the past eight years, according to data from Singapore’s Department of Statistics.

This comes despite Singapore’s headline GDP growth remaining relatively strong in 2025, with overall economic expansion outpacing expectations, highlighting that even in a growing economy, many firms still faced mounting operational pressures.

The surge in closures has been uneven across sectors, with some industries more affected than others. Here is a breakdown of the most impacted sectors in 2025:

What the numbers reveal

Business closures in 2025 by industry:

Wholesale trade, professional services, and information & communications accounted for the largest number of closures, reflecting both market competition and structural pressures.

Retail trade and F&B, often highlighted in media coverage, remain significant contributors but are not the only sectors under stress.

Even traditionally stable sectors such as financial services and education recorded thousands of closures, showing that operational challenges are broad-based: no sector is immune to cost pressures, competition, or market uncertainties.

Over the past year, Singapore has witnessed a series of prominent business exits that illustrate the scale of the disruption.

Homegrown fashion label The Closet Lover announced its closure in May 2025, shutting both its online and offline stores after 17 years of operation. Cinema operator The Projector also wound down last year, citing the “increasingly unforgiving” realities of the industry.

The F&B sector experienced a spate of closures as well, with brands such as Twelve Cupcakes, Fluff Stack, and The Prive Group ceasing operations. International brands were not spared either, as Eggslut and Gong Cha shuttered their Singapore locations, showing that foreign operators are equally exposed to the local market’s challenges.

Why closures are rising

Several factors have contributed to the sharp increase in business closures in Singapore in 2025, combining both structural challenges and short-term pressures.

High operating costs have put a strain on many firms, particularly in F&B and retail. Rising rents, wages, and input costs have squeezed already tight profit margins, with some small shops in popular districts like Kampong Glam seeing rents double or even triple in recent years.

Intense competition adds another layer of difficulty.

While Singapore remains an attractive market for new businesses, the sheer number of entrants—both local and international—across hospitality, lifestyle, and other sectors makes it increasingly challenging for firms to attract enough customers or secure the talent needed to sustain growth.

Debt and liquidity pressures are also significant.

Many companies have struggled with unpaid debts or cash flow issues, driving an increase in liquidations to levels not seen in several years. In fact, data from the Ministry of Law shows that the number of compulsory winding-up applications and the number of companies ordered to liquidate reached a 15-year high in 2025.

Entrepreneurs still keep entering the market

Despite the surge in closures, Singapore’s business formation remains strong.

In 2025, 78,146 new entities were registered, continuing a steady, modest rise that has been seen every year over the past decade.

While many entrepreneurs are still entering the market, a similarly large number of firms are exiting, resulting in only modest net growth in active businesses. This reflects both strong entrepreneurial optimism and the harsh realities of operating in sectors with tight margins.

The challenging operating environment has continued into 2026—some exits thus far have included Itacho Sushi and Deliveroo.

With global uncertainties such as the Iran war, the business landscape is unlikely to become any easier. Business sentiment in Singapore has already taken a hit as companies grow more cautious about future demand and cost pressures.

Firms are being forced to adapt quickly, with resilience and strategic planning becoming increasingly critical for survival.

Featured Image Credit: Jason Goh/ Pixabay