F&B recovering steadily but some segments must transform to tap new revenue streams: Chan Chun Sing

A Swee Choon staff member serving Minister for Trade and Industry Chan Chun Sing (second left) and Swee Choon owners Tony Ting (centre) and Ernest Ting (left) from a robot waiter, on Nov 30, 2020. PHOTO: LIANHE ZAOBAO
A big driver of this recovery by the F&B sector is from companies that have embraced digital adoption. PHOTO: ST FILE

SINGAPORE - The food and beverage sector is on a path of steady recovery, with many companies seeing their revenues back to around 70 to 80 per cent of pre-Covid-19 sales.

And a big driver of this recovery is from companies that have embraced digital adoption, said Minister for Trade and Industry Chan Chun Sing on Monday (Nov 30) during a visit to Swee Choon Tim Sum Restaurant.

The minister noted that more restaurants and eateries have turned to selling food and beverages online even after Singapore exited the circuit breaker in July.

Of the total industry sales in the food services sector, nearly 45 per cent were made online in May when the circuit breaker was in place - up from roughly 10 per cent in January, said Mr Chan.

By September, about one in five of sales was made online - higher than pre-circuit breaker levels, he added.

The food services sector contributes about 1.1 per cent of Singapore's gross domestic product and employs about 5.5 per cent of Singapore's workforce.

Mr Chan said Covid-19 has accelerated the need for F&B players to adopt digital technologies to operate more efficiently and effectively.

This is especially so for those in the Central Business District, tourism-related areas and catering companies, all of which are seeing slower recovery, he said.

The minister noted that more F&B companies have been seeking government assistance to adopt IT solutions.

Between January and October this year, the number of applications for the Productivity Solutions Grant (PSG) in the F&B sector was more than four times that of the same period last year.

So far, more than 2,700 PSG applications for IT solutions have been approved this year, said Mr Chan.

Swee Choon is an example of an F&B company that adapted quickly during the circuit breaker, by pivoting to food delivery services to minimise the impact of Covid-19 on its business, said the minister.

These efforts increased its sales from food delivery significantly, from less than 1 per cent before circuit breaker to around 60 per cent of its existing average monthly revenue during circuit breaker, said Mr Chan.

Even as dining in resumed, sales from food delivery continue to contribute about 25 to 30 per cent of Swee Choon's monthly revenue, he added.

With the increased revenue from food delivery sales, Swee Choon has boosted its overall revenue to pre-Covid levels, amid seating capacity restrictions due to safe management measures, he said.

Mr Chan said the Government will continue to support F&B players with various initiatives to help them adopt digital technologies.

For example, companies can get digital marketing support through the Enterprise Development Grant (ESG) or sign up for subsidised digital marketing courses.

Various initiatives under the SME Go Digital programme also help companies use digital technologies, such as the Digital Resilience Bonus, where F&B companies can get bonus payouts of up to $10,000.

Companies are also encouraged to test new business models to capture growth opportunities, said Mr Chan.

He noted how catering company Le Rainbow is partnering with the Food Innovation and Resource Centre - a joint initiative between Singapore Polytechnic and ESG - to develop ready-to-eat products targeting dormitory workers and the elderly, to increase its revenue streams given restrictions on buffets.

Companies can also take advantage of FoodInnovate, a multi-agency initiative led by ESG that provides resources to Singapore food companies to drive food technology and innovations, said Mr Chan.

As companies digitalise and automate their processes, there are opportunities to redesign jobs to make working in the sector more attractive to locals and reduce the sector's reliance on foreign manpower, said Mr Chan.

As of mid-November, more than 1,100 workers from more than 30 F&B companies have undergone or are undergoing reskilling through Workforce Singapore's Job Redesign Reskilling Programme for Food Services.

Companies can also get course fee subsidies and absentee payroll for some courses through SkillsFuture Singapore's Enhanced Training Support Package for the Food Services sector, he added.

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