Taking a deep dive into the F&B business

A restaurateur’s experience: Gruelling fight for survival in a collapsing sector, with strong government support

In the months leading to the circuit breaker (CB), I found myself contemplating the question of business survival.

As our restaurants geared up for Chinese New Year bookings only to face panicked cancellations and indefinite postponements, what loomed ahead was uncertainty.

In the early days of the pandemic, survival was a nagging concern. Could we make up the revenue lost from big events? That background whine grew into a louder worry as imported Covid-19 cases grew.

With rotational teams and work-from-home policies, people traffic decreased dramatically in the CBD (the Central Business District, where our restaurants are located). Would we be able to attract even half of our usual crowd when the odds were stacked against us?

Then, that already maddening hum became deafening when things came to an abrupt standstill.

Very quickly, entertainment outlets were forced to close and restaurants were expected to pivot to takeout and delivery. Dining in was no longer an option, not even with the social distancing rules put in place a week earlier.

I remember watching the Prime Minister's speech live on YouTube with my seven-year- old daughter. As she startled delightfully over the prospect of homeschooling for a month, I knew that the question of survival for restaurants had drastically changed in nature.

The question was no longer about how to increase revenue to sustain the business, because there was no more revenue to speak of.

No matter how hard we worked, takeout and delivery would make up no more than 5 per cent of normal sales. The existential question confronting restaurants was now an imminent one.

Should we stay on to fight this war? The crushing impact of the CB had exposed the vulnerabilities of the food and beverage (F&B) industry. Razor-thin margins from having to cope with exorbitant rents and customer price sensitivities endowed by the information age meant that most restaurants have no capital reserves.

When I started out 15 years ago, selling an experience was the heart of F&B. When did that transform into selling a social media presence?


I digress, but the point is that competition among F&B outlets on social media gives the false impression the industry is thriving despite high rentals, price wars and manpower difficulties. It is not.

Now, the Covid-19 crisis has plunged us into a deep dive that will drown most of us, while food delivery platforms piggyback on our plight to profit from high delivery commissions.

Meanwhile, landlords delude themselves into believing that there will always be another F&B tenant if we cannot pull through.

For some, the devastation of the F&B scene has not sunk in. I assure you that the scene has already collapsed.

Yet there is solidarity in the nation's response to this collapse. An informal coalition we call "Savefnbsg" has a membership of around 250 restaurateurs representing more than 500 outlets; we chat every day on WhatsApp and share tips, news and woes.

We lobby, petition and stand together, putting aside competition to fight for what our industry stands for. There are also other platforms, like Singapore Restaurant Rescue, which has garnered 56,000 posts so far, and SG Restaurant Support.

Customers, both regular and new, have shown us extraordinary love by ordering deliveries and purchasing vouchers, sending words of encouragement to our employees on the front line.

Most importantly, the Government has been steadfast, trying its best to balance the interests of public health against the economy; of corporations against individual employees; of personal freedoms against community interests. With the Covid-19 (Temporary Measures) Act and Jobs Support Scheme (JSS), the Government has given us something to stand behind.

We stand behind more than the policies themselves, which require a delicate balancing act that will not and cannot benefit all of us.

Yes, there will always be haters, people who cry injustice - "not fair!" - and people who think they would have done differently had they been in the Government.

There are also those, like me, who lament the shortfall in certain policies while celebrating their overall cogency. We call for bolder steps, like capping the commission percentage that food delivery platforms are allowed to demand to 15 per cent (like San Francisco has done) instead of the current 30 per cent, and mandating that landlords charge rental based on an agreed percentage of gross turnover for the CB period.

We call for more empathy, like understanding that JSS rebates are but a fraction of what we need to survive. We call for more trust, like doing away with personal guarantees on small loans to credible restaurants with a good track record.

But what cannot be denied is that our Government has demonstrated unwavering composure in these unprecedented times. Years of preparation for pandemic readiness have paid off, enabling our leadership to steer us out of these woods.

The Covid-19 crisis turns the spotlight on the merits of every government's social contract with its people. Whereas Singapore has often been criticised for its unwillingness to expand certain freedoms, it is obvious that what matters most, in times of unexpected and constant change, is that everything works.

From decisive law-making to expedited government payouts; from automated application forms to customised advice; from centralised home-based learning to childcare for those in essential services, Singapore has managed to transition into the CB as though it has had several dress rehearsals for this scenario.

It is a relief that our Government has been built on a model of social contract that can assure us protection against a descent into chaos.

It is that which we stand behind.

I continue to keep my restaurant open for takeout and delivery although I see the rubble around me: employees I have had to lay off, salaries I have had to suspend or slash, suppliers I try to pay but cannot, and the mounting rent that my landlord has stubbornly refused to waive. I keep it open to sustain livelihoods as best I can, and to keep a small light on for all of us.

Our restaurant started a movement where we would "pay it forward", donating one hot meal to The Food Bank Singapore with every $25 cash voucher purchased from us. With this movement, we add a little more fuel to the fight against Covid-19. The idea that we can contribute keeps us going.

The aftermath is going to stretch for years, and our restaurant may be shuttered when this is over, but I believe Singapore will survive this and will emerge stronger.

Perhaps global dynamics will shift and Singapore may no longer be as strategic a hub as it was pre-Covid-19, but I am confident that we, as a people, will rebuild all that we have lost.

Tay Eu-Yen is a lawyer and nightlife/F&B entrepreneur. She first stepped into the nightlife industry 15 years ago with the iconic nightclub, The Butter Factory. She is currently at the helm of Coterie Concepts, and is a founding member of the Singapore Nightlife Business Association.

This essay is from The Birthday Book 20/20: Seeing Clearly, published by The Birthday Collective, which puts out an annual anthology of essays on challenges and opportunities Singapore faces. This year's edition is edited by Selina Chong and Chua Jun Yan.