Johor Bahru called a lifeline for Singapore’s struggling food businesses

SINGAPORE: It has been widely reported that many eateries in the Little Red Dot have been having a difficult time due to high rentals, manpower issues, rising ingredient costs, and other reasons. For a city that has made a reputation for itself as a foodie haven where delicious and affordable food is abundant, this has been a cause for no small concern.

A report last week in the South China Morning Post (SCMP), however, says that Johor Bahru, the Malaysian state closest to Singapore, is offering a “lifeline” of sorts to struggling eateries, providing food business owners an opportunity to continue serving up delicious meals.

The report cited the high number of restaurant closures in Singapore in the past year and a half. In 2024, 3,047 eateries shut down, the highest number in nearly two decades. And this year, 1,404 food businesses folded between January and June.

Among the notable eateries that are now gone are established names such as Eggslut, Burger & Lobster, and Manhattan Fish Market, as noted by the SCMP. In addition, Wala Wala Cafe Bar also shut its doors, as has the 20-year-old Holland Village branch of Crystal Jade La Mian Xiao Long Bao.

The main attraction of Johor Bahru, and indeed the rest of Malaysia, for Singaporean food businesses is the affordability of both manpower and rent. This gives eateries a chance not just to survive but to thrive, even though the restaurateurs SCMP spoke to said they recognise that ingredients are costlier in Malaysia. For example, Govinda Rajan, who opened a Mr Biryani outlet in Johor Bahru last April, told SCMP that in Singapore, his priority had stopped being profitability and had shifted to survival.

Not that the food business is slowing down in Singapore itself, as more F&B establishments opened than closed last year. In 2024, 3,793 new outlets opened, the second highest in more than 30 years.

The Singapore Business Review reported on Jul 17 that in 2023, there were 22,747 licensed food establishments in the city-state, which is the highest number ever. It added, “The risk of oversupply is no longer theoretical.”

Moreover, in a commentary published last week in Channel NewsAsia, former restaurant owner Chua Ee Chien asked whether it’s time to change Singapore’s F&B rules.

“Licensed F&B outlets shoulder an enormous burden well before serving their first customer. Rent in prime locations can exceed S$20,000 monthly. You don’t have to run a fancy fine-dining joint for fit-out costs to reach six figures. There are various regulatory requirements that businesses must meet across agencies, such as the Urban Redevelopment Authority (URA), Singapore Food Agency (SFA), National Environment Agency (NEA), Singapore Civil Defence Force (SCDF), and Building and Construction Authority (BCA).

“On top of that, daily costs are compounded by things like utilities, safety inspections, staff training and wages, Central Provident Fund contributions, pest control, professional fees, regulatory delays, and so on.” /TISG

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