Why Singapore favors disruptive innovation in F&B industry

Bland productivity growth clobbered the sector.

The Singapore government is backing up disruptive models in the food services industry as it sees continuous and cutting-edge innovation as key in spicing up the crumbling business sector.

According to Deputy Prime Minister and Coordinating Minister for Economic and Social Policies Tharman Shanmugaratnam, F&B businesses have no choice but to change and make progress in productivity industry-wide and individually in each enterprise. The industry sees a high churn of enterprises. On average, 28% of food establishments are replaced every year.

“Some players move faster than others, and the less efficient and innovative players lose market share and drop out along the journey. There is no avoiding this restructuring of the market. As the labour market tightens, we can expect this restructuring to accelerate,” Tharman said.

The F&B industry is part of Singapore economy’s domestically-oriented sector that has seen little productivity growth in five years. The government is giving the sector a shot in the arm through a major makeover. Last week, the city-state launched the Food Services Industry Transformation Map (ITM) to make its initiatives in the sector possible. The roadmap is one of 23 ITMs being developed under Singapore’s $4.5 billion Industry Transformation Programme that will be rolled out over the next five years.

“It will involve intensive collaboration. SPRING Singapore will take the lead within government. We will partner our TACs including the Restaurant Association of Singapore in particular, enterprises themselves and our unions such as the Food, Drinks & Allied Workers Union,” Tharman revealed.

The Food Services ITM aims to push ahead with more manpower-lean formats in the industry and upgrade jobs and job satisfaction, while maintaining the quality and range of dining options. Its main thrusts include developing innovative formats like ready-to-eat meals, promoting mass adoption of technologies, raising employees’ skills and versatility, and expanding Singapore F&B’s footprint in overseas markets.