Govt launches road map to transform food services industry

By Rennie Whang, The Straits Times, 8 Sep 2016

The Food Services Transformation Map, first of 23 industry-specific road maps, was launched on Thursday (Sept 8) morning.

These road maps are designed to promote the growth and competitiveness of Singapore's key industries.

"We are bringing together our initiatives for productivity, innovation, SkillsFuture and enterprise internationalisation for each industry, to ensure maximum effectiveness and impact," said Mr Tharman Shanmugaratnam, Deputy Prime Minister and Coordinating Minister for Economic and Social Policies.

He was speaking at the opening of Select Group's corporate headquarters and the launch of the food services industry transformation map.

The critical issues facing the industry are those of raising productivity and reducing reliance on manpower, SPRING Singapore said in a media release. The food services industry contributes to 0.8 per cent of GDP but employs about 160,000 workers - a disproportionate 4.5 per cent of Singapore's workforce.



The road map for industry will work towards the achievement of an annual productivity growth target of 2 per cent without any increase in manpower over the next five years.

Its key features include: developing innovative formats like Ready-to-Eat meals; promoting mass adoption of manpower-lean technologies; raising employees' skills and versatility, and expanding the footprint of Singapore's F&B companies in overseas markets.

For example, SPRING Singapore estimates that by 2025, three out of eight dining experiences in Singapore will involve new formats like grab-and-go vending machines, he noted.

The Government also launched VendCafe in Anchorvale last month, Singapore's first food vending machine cafe.

On the manpower front, Mr Tharman noted that "we have to work on the basis that there will be no further manpower growth in the industry. The heavy reliance on low-skilled workers also cannot continue."

So, among the ways forward include digital services like electronic payments, and redesigning jobs to be more fulfilling, provide career progression and raise wages.

The food services industry transformation map (ITM) together with retail, food manufacturing and hotel ITMs fall under a Lifestyle cluster. Senior Minister of State Sim Ann and Select Group managing director Vincent Tan will co-chair a team of industry practitioners and unionists to oversee the implementation of the ITMs for the Lifestyle cluster.

A taste of future at upcoming coffee shops
Innovative dining formats, new payment options and automation a first step in transforming food industry
By Rennie Whang, The Straits Times, 9 Sep 2016

A futuristic new breed of coffee shops - at the vanguard of a $4.5 billion nationwide IT transformation - could include features such as ordering via mobile apps or digital kiosks, and cashless payments.

Operators keen to meet the challenge of bringing in this type of innovation can bid in a tender for shops at two sites in Tampines and Choa Chu Kang later this month.

Interest could be strong but BreadTalk (Food Republic) and Auric Pacific (Food Junction) were yesterday unable to say yet if they would be in the running.

This is just the first step in the plan to transform the food industry - and 22 other key industries.

The Food Services Industry Transformation Map (ITM) was launched yesterday by Deputy Prime Minister Tharman Shanmugaratnam, also Coordinating Minister for Economic and Social Policies.

It is part of the Industry Transformation Programme announced in this year's Budget. The ITMs "lay out the growth and transformation strategies for the 23 key industries over the next five years... bringing together our initiatives for productivity, innovation, SkillsFuture and enterprise internationalisation for each industry", he said.

While the overseas-oriented sector has been doing well with high productivity growth, progress has been slow on the domestic front, including food services, he added.

These industries are split into six clusters. Food services fall under the lifestyle cluster whose oversight team will be jointly chaired by Senior Minister of State for Trade and Industry Sim Ann and Select Group managing director Vincent Tan. SPRING Singapore will be the lead agency for the cluster.

A pillar of the food services ITM - covering new-look coffee shops - is adopting innovative food formats.

By 2025, three out of eight dining experiences here will involve new formats, SPRING estimates.

Ready-to-eat meals would be a viable option too, Mr Tharman noted. Last month, Singapore's first food vending machine cafe with ready meals was launched in Sengkang.

Improving productivity via adopting technologies is also key.

"We have to work on the basis that there will be no further manpower growth in the industry. The heavy reliance on low-skilled workers also cannot continue," he said.

To stay competitive, firms must "embrace change in both the front and back of the business - every way of reducing the manpower required". This could involve using digital services such as electronic payments, for example.

SPRING and partners aim to see at least half the industry with technology-enabled operations by 2020.

This could make possible productivity growth of 2 per cent per year on average, from now till 2020, in the food services sector.

The agency yesterday unveiled time-limited grant support for initiatives in three areas - digital services, kitchen automation and automated dishwashing - till late 2018.

Other pillars of the ITM for the sector include deepening workers' skills and redesigning careers in the industry, and expanding the footprint of local food firms overseas.

The industry is a key employer, accounting for about 4.5 per cent of the total workforce - over 5 per cent if hawker centres are included. It also contributes to 0.8 per cent of Singapore's economic output.

But "we are running out of manpower in the industry... We must develop a food services industry that is highly efficient, with no loss in quality of food offerings, and with high-quality jobs. It has to be a major makeover", said Mr Tharman.

On why food services was the first ITM launch, Ms Sim told reporters: "Food is something that is very important, especially to Singaporeans. Food services is also an area in which many of our firms can potentially do very well...This is a very good example of a more domestically oriented sector in which innovation and transformation will bring about a very big difference to many stakeholders."

30,000 meals no issue at Select kitchen
By Rennie Whang, The Straits Times, 9 Sep 2016

From its humble beginnings as a Chinese mixed vegetable rice stall, Select Group has flourished to oversee 24 businesses, including Peach Garden and Lerk Thai.

The firm is at the forefront of technological changes encouraged by the new Industry Transformation Map for the food services industry.

Yesterday, it opened its new $60 million headquarters in Senoko, which has a 20,000 sq ft ready meals production kitchen and the capacity to make over 30,000 ready-to-eat meals daily.

This will be a new business arm for the company.

"We did many market studies over the last two years. For countries like China, Japan and Britain, ready meals account for 5 to 7 per cent of the market but it's just 0.5 per cent here. So we see a lot of potential in this market," Select's managing director Vincent Tan said.

The company also invested in additional automation, including an automatic rice cooking line, a conveyor steam oven, conveyor vegetable washers and a bun encrusting machine for bao.

So, now two people can cook 4,000 portions of rice each per hour - compared with eight to 10 people to produce the same amount, Mr Tan said. All this will help it double production capacity by 2020, he noted.

Beyond Singapore, Select Group is operating in Malaysia, where it has Hong Kong Sheng Kee Dessert and Pho Street outlets. It aims to expand farther into other South-east Asian countries, with an eye on establishing more than 1,000 F&B outlets, up from about 160 now.

The new headquarters will support staff training, as it has a culinary demonstration kitchen and training institute for in-house courses.

"The labour crunch is something that we cannot deny. Everybody has to change the way they operate and run their F&B services... If not, it will be very tough," he said.

Food industry welcomes plan to reduce reliance on manpower
Ready-to-eat meals, cashless payments among innovations in Govt's road map
By Jalelah Abu Baker, The Straits Times, 10 Sep 2016

The food industry has welcomed a government plan to help the sector become more productive and less reliant on manpower.

Ready-to-eat meals and cashless payments were some of the innovations recommended under the Food Services Industry Transformation Map launched on Thursday by Deputy Prime Minister Tharman Shanmugaratnam.

Mr Hong Poh Hin, chairman of the Foochow Coffee Restaurant and Bar Merchants Association, which has more than 400 members, said such technology solutions are a step in the right direction.

Other countries, such as Malaysia, where some workers in Singapore's food industry are from, also suffer from manpower problems, he noted.

But Mr Hong, who owns a coffee shop in Serangoon Avenue 4, warned that a high-tech environment may mean the need to employ more educated workers who command better salaries.

He said higher salaries could lead coffee shops to raise prices, which will not sit well with consumers. Many workers already earn more than $1,000, he said.

SPRING Singapore, which helps enterprises here grow, said on Thursday that the food services industry contributes 0.8 per cent of gross domestic product but employs about 160,000 workers, or 4.5 per cent of Singapore's workforce. The road map aims to make possible a productivity growth of 2 per cent a year on average in the food services industry from now to 2020.

Restaurant Association of Singapore president adviser Andrew Tjioe said: "We know this is the way to go. If we keep relying on manpower, we will not survive."

Mr Tjioe, also executive chairman of the Tung Lok Group of restaurants, said it takes just one person to operate two robotic cooking machines that can cook 60kg of food for Tung Lok.

But he acknowledged that some smaller operators may not enjoy the kind of scale that would justify the cost of implementing such technology solutions.

Mr Danny Yeo, 67, a retiree who eats out at least once every day, said he welcomes moves that alleviate manpower problems, with an example being cashless payments.

He said it is hard to get the attention of staff in eateries sometimes when they are busy, so self-ordering through a machine would help.

But he is not keen on food served in vending machines. "The quality is likely to suffer. We are already slowly losing good hawkers and good food," he said.

He would be happy to know then that there are some - such as Mr Benny Se Teo, owner of restaurant chain Eighteen Chefs - who are reluctant to replace people with machines.

Mr Teo said: "Even if there is automation, you still need people for the human touch. It's like your mum cooking for you."