F&B is a brutal business in food haven Singapore

Rather than words of inspiration, F&B veteran Alan Lee who owns Greenwood Fish Market, has a question for starry-eyed hopefuls keen to start their business in Singapore: “Are you sure you want to do this?”

“Are you ready for the s***storm that is about to come?” he added, in an interview with ST in 2023. 

It’s a sobering call three years on, particularly after local chain Kith Cafe saw several outlets close in recent months. Stalwarts like Ka Soh and Michelin-starred restaurants like Shinji too have been unexpected casualties. 

The brutal churn plaguing F&B has not spared international brands like Burger & Lobster, PizzaExpress,or big boys like the Prive Group and Eggslut. Over six in 10 such businesses close within five years – of which eight in 10 have never recorded a profit. Those are cold, harsh facts.  

The S$12 billion F&B sector may be one of the most cut-throat industries in Singapore, with the highest closure rates and new openings. Over 300 shut each month in 2025, an elevated rate even compared to pandemic-era norms. 

Observers point to the “Scissors Effect” where rising rents and labour costs brush up against consumer sensitivity amid a growing range of options. Just look at how many Chinese brands like Mixue, Chase and Haidilao have made landfall, and how many Singaporeans head to Johor to stretch their dollar. 

Then there’s the rise of small-time home F&B businesses operating out of HDB flats and landed homes – at least 150 when we last checked. And concerns about regulatory constraints – like the Budget Meal requirement which the Housing Board has just made optional.

Growing public concern that F&B may be less of a viable path for budding Singapore food entrepreneurs have sparked discussion in our Forum pages. Rental control is often suggested. Yet Singapore’s F&B sector appears to be working fine, where consumers benefit from variety and competition, and with closures part of expected market dynamics.

Locals employed in the industry are buffered by public policy ensuring a tight labour market, with a foreign workforce as the shock absorber. A progressive wage model also places a wage floor and progression requirements, while industrial relations and norms against sudden retrenchment help to smooth volatility to some extent, as the Twelve Cupcakes retrenchment demonstrates.

Government intervention should therefore focus on supporting productivity and innovation, as well as land use guidelines to spread out F&B outlets to temper saturation rather than propping up zombie businesses. Prioritising specific businesses too is key. Here a recent move to aid heritage businesses seems broadly in the right direction, recognising their inherent cultural and social value, which market forces sometimes are unable to factor in. 

The bottom line? It’s ironic that F&B businesses are struggling in Singapore, which is often celebrated for its diverse, affordable and accessible culinary scene. But that hypercompetition may be a feature, not a bug, of a food haven. And those that can make it in Singapore? Maybe they can make it anywhere.

Until next week, here are my picks from the week to get yours started.

Suling Lin

, Opinion Editor

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