Exploring the Reasons Behind 3,000 Restaurant Closures in Singapore in 2024

With a record of 3,000 restaurants closing their doors, Singapore F&B operators continue to suffer from high rent and inflated Costs of goods and utilities.

Rising Operational Costs: Ingredients, Rent, and Labor

The restaurant industry is experiencing unprecedented increases in operational costs. Due to supply chain disruptions and inflation, prices for essential ingredients have skyrocketed, making it challenging for restaurants to maintain their profit margins without passing on the costs to consumers.

In addition to the difficulty in hiring a workforce. Labor costs have also increased as restaurants struggle to attract staff in a competitive job market, resulting in higher wages and benefits that contribute to overall operational expenses.

Higher Rent

When the industry standard for rent is lower than 10% of revenue, it is commonly over 15% in Singapore, leading to considerable pressure. Rent continues to rise as new restaurants and international brands (Mainly Chinese cuisines) enter Singapore, increasing market saturation and fueling higher rent.

Government Policies and Support: What Needs to Change?

Government policies play a significant role in shaping the restaurant industry’s landscape. While initiatives have been introduced to support businesses during the pandemic, many argue that these measures have not addressed the long-term challenges restaurants face today. The higher quota of foreign F&B workforce shall apply as locals do not have an appetite for this industry.

More comprehensive policies are needed that provide immediate relief and foster sustainable growth in the restaurant sector. This includes revising regulations related to labor costs and rent control, as well as providing targeted support for small and independent restaurants, which are crucial to Singapore's culinary diversity.

How can F+B support local F&B?

For the Singapore F&B industry, if your business is struggling, we are here to support you. We created a three-phase special program (deep-dive audit, Strategic roadmap, and Execution) that demonstrates proof based on your data with a clear ROI. We will align our success with yours. Please get in touch with us, and we will visit you.

At F+B - Your Partner for Dining & Bar Advisory- Strategy, Concepts, Franchises, Management, we don’t just advise our clients—we partner with them every step of the way. Our approach goes beyond recommendations; our commitment to execution leads to longer engagements and deeper, more impactful results.

Source article #cna by @Yip Jieying https://cnalifestyle.channelnewsasia.com/dining/fb-outlets-highest-closure-20-years-459411