Everything About the Allegations of honestbee’s ‘Cashflow Issue’ & Their Response in 1.2K Words

Image: InqPOP!

We’ve often joked about our boss for being fat and nasty, but this isn’t a joke: he’s very, very stingy.

Every single cent that the company spends must be justified. For example, if a person’s going for an appointment or event, our boss will reach for that big calculator on his desk and decide whether it’s more worth it for the person to take public transport or Grab—reason being, he’s counting the person’s hourly pay to determine if the savings of taking Grab is more worth it or not.

Therefore, if an appointment requires two people, we can definitely Grab as two people’s combined hourly rate would definitely be more expensive than a Grab ride.

And another case in point: one of my colleagues has been advocating for a vacuum cleaner since our CNY spring cleaning, and despite us providing lots of justifiable reasons, he refused to buy it, and is still waiting for someone to discard a vacuum cleaner so that we can keep it in the office.

Truth to be told, some people disliked this culture, but after reading what honestbee has allegedly been through, I guess it’s a culture that apparently ensured that each one of us gets our pay on time every month.

Because like what a wise lawyer once said, “Being an entrepreneur is never easy and juggling between finding the work, feeding people and paying salaries on time is a constant struggle.”

honestbee, the Inspiration for Aspiring Entrepreneurs

Unless you’ve been living under a rock, you’d know about honestbee, or at the very least, see their yellow vans plying the roads.

The Singapore tech startup is an inspiration for aspiring entrepreneurs: it started as a grocery delivery service app in 2015 and expanded aggressively beyond Singapore to Hong Kong, Taiwan, Thailand, Indonesia, Malaysia, Bangkok, Philippines and Japan.

With the company being funded by investors from a Silicon Valley investment firm and several other investors (which they didn’t disclose), its war chest comprises millions of dollars—enough for them to branch out to other businesses like food delivery in several regions and laundry + ticketing service in Singapore.

And of course, who can forget the high-tech and hipster supermarket, habitat by honestbee.

2019: The Start of Problems

Everything of course looks good until the beginning of this year, when the partnership with NTUC FairPrice was “temporarily paused”. Any Singaporean would know that this is a big deal, given that FairPrice is no doubt one of the biggest supermarket chains in Singapore.

The optics given was by honestbee was that they were “reviewing its processes and service levels with its partners as it looks to provide the best product and service offerings for its customers.”, while FairPrice said that it is “is due to a review of the existing operations and collaboration process.”

Peter Tay meets a Genie who helps him wipe off three of his past mistakes. You won’t have expected what he wished for for his third wish. Watch it here:

Oh, wells.

Anyways, our goldfish memory forgot about this until recently, when Vulcan Post published an article about honestbee’s alleged cashflow problem: an anonymous source told the online publication that the FairPrice suspension was due to outstanding debts.

To add fuel to the fire, there were also a report that the local startup has owned its partner-vendors about SGD$24K in Taiwan.

Even before this shocking article, honestbee has suddenly put a pause on its best performing market, the Philippines. Go through their app reviews in Google Play Store and you’d see many people in the region giving a one-star review because they weren’t aware of the sudden suspension of business. Also, it’s reportedly that about 6% of their 1,000 workforce is being laid off.

But the most shocking allegation came on 25 April 2019 by TechCrunch.

A source told them that the company is in crisis mode: the company has run out of money and might not be able to pay their Singapore staff on time. TechCrunch allegedly managed to see the financial numbers for honestbee, and honestly speaking, it didn’t look good: In December 2018, the company lost a whopping $6.5 million.

It’s also alleged that honestbee is talking to companies like Grab and Go-Jek over a potential acquisition of part, or the entirety, of the business.

However, before the month ended, honestbee came out to refute the allegations.

Allegations of Cashflow Problems “Untrue”

Prior to that, the company has not responded to the allegations, but let’s face it: if the pay isn’t in, we’d be seeing resignations and unhappy employees who’d be more than willing to provide information for some dough.

In the last day of April, honestbee finally responded—in a one-way communication as they did not respond to any questions.

Instead of cutting 6% of their total workforce, they’re cutting 10%. In addition to the suspension of their services in the Philippines and Japan, they’re stopping their services in Hong Kong and Indonesia, and also pausing their food delivery in Thailand.

The reason for ending the services in these regions? It’s for them to “focus and align our regional business, and more importantly, to enable us to better meet our customers’ needs.”

In addition, they’ve also mentioned that reports of salary rumoured to be delayed are untrue, and are also committed to “fulfilling our financial obligations to all Bees, partners and vendors.”

Here’s the full statement:

In 2015, honestbee started in Singapore with the mission of providing positive social and financial impact on the lives and businesses that we touch. Today, we are a regional business committed to making great food experiences accessible to customers across Asia.

Over the past four years, we have demonstrated commitment to our staff, partners and customers, and continue to innovate and improve our business to stay relevant in today’s rapidly-changing business environment. The launch of habitat by honestbee in Singapore last October marks the next phase in our evolution as a food company.

As part of an ongoing strategic review of our business, we are halting our services in Hong Kong and Indonesia, as well as our food vertical in Thailand. Our services in Japan and the Philippines, along with specific partnerships in others markets are also temporarily suspended as part of this review. This is necessary to help us focus and align our regional business, and more importantly, to enable us to better meet our customers’ needs. The status of honestbee’s business in the remaining markets stands unchanged.

Some roles within the organisation will no longer be available. Approximately 10% of our global headcount in the organisation are affected.

There have been media reports regarding payroll delay for our employees. We would like to stress that this is untrue. We will ensure that all employees across all markets, including Singapore, are paid in a timely manner.

In addition, we are also committed to fulfilling our financial obligations to all Bees, partners and vendors.

TODAYonline Pressed for More Info

Following the statement, TODAYonline tried to get some answers from FairPrice, but their spokesperson repeated what they’ve said earlier this year.

The all-digital publication then proceeded to ask an employee of an honestbee partner-vendor on whether payment has been prompt, and the employee said honestbee has been consistent with its payment.

They also found an honestbee employee who mentioned that he has received his latest salary on time.

Well, only time would tell if we’ll continue to see bees shopping for us.

In the meantime, I would have to appreciate my boss’ stinginess, and now I understand why he’s refused to buy that vacuum cleaner.