NTUC Enterprise Buys Kopitiam So Food Prices Wouldn’t Surge Like Grab During a Rainy Day

By
George Yang
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Before anything, I’d like to imagine yourself as a businessman selling, let’s say, rice. In Singapore, you’re the exclusive importer of rice and your product keeps people alive.

I mean, yes, Singaporeans can have noodles as well, but to a 饭桶  like myself, I can’t survive without my daily cai png, or I’ll get so depressed that I might microwave a puppy and boil a kitten.

But moving on: imagine that the demand for rice has suddenly increased threefold, because all noodles manufacturers in the world have decided to cease operations.

Overnight, your daily sales of 1 million pack of rice ballooned to 2 million, and people have no choice but to buy your rice.

So, what do you, as a savvy businessman, do?

You jack up the price, of course. After all, people need rice to survive, and with the circumstances, you know you can make more profits without having to spend more. Your Mercedes C-Class is finally going to be upgraded to a S-Class.

Well, even if you’re not going to do that because you’re running a business purely for passion and your shareholders invested for your passion, smaller businesses would buy your rice at the original price and resell it at a higher price. In other words, prices would definitely increase whether you like it or not, simply because this isn’t Utopia.

Think this is a story? Think again.

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The N95 Case Study

PSI of over 400 might have become part of our memory, but the lesson of N95 should always be remembered.

N95 masks are known to be one of the most effective masks against the haze. Back in the days when the demand of it suddenly suppressed its supply, the price of the mask increased by almost 37.5%.

Of course, we all know the happy ending: the authorities stepped in to assist, and NTUC Fairprice cap the prices of the masks while limiting the number a person can buy.

So, why this little history lesson when all you want to know is whether you can still use your Kopitiam card?

Because this is part of the reason why a non-profit organization is buying over a profit-driven company.

NTUC Enterprise Buying Over Kopitiam

One of the key things for survival in Singapore is food: should hawkers all decided to hold hand and increase their prices by 2,000%, we’ll all be having Maggi Mee every day.

Which is why NTUC Foodfare exists: according to its website, its Social Mission is to “provide value, quality cooked food in Singapore by providing a pricing benchmark for the industry to follow.”

You see, that means if their coffeeshops sells a plate of chicken rice at $1.50, every hawker has to sell it at that price, if not people would all flock to NTUC Foodfare.

But of course you can’t find a $1.50 chicken rice anywhere, but you get the drift: they’re there to ensure that prices wouldn’t suka suka increase just because some hawkers want to drive a BMW 7-Series.

That is precisely why there has been a bit of a hoo-ha when they went on to manage new hawker centres: they require hawkers to sell at least one dish that is affordable, and hawkers aren’t happy (they say is ingredient expensive lah, not ‘coz they need a BMW lah, but anyways).

But beyond the hoo-ha, the bigger picture is that hawker foods are kept affordable, and there’s no chance of a crazy price surge like the one you’ve got when you try to Grab during a rainy day.

Today, it’s announced that NTUC Enterprise is buying over all of Kopitiam Investment and its subsidiaries, which include brands like Bagus, Cantine and even Lau Pa Sat. All in all, there are over 90 eateries in its portfolio.

In comparison, NTUC Foodfare has 24 eateries and manage 9 hawker centres.

The amount to buy over isn’t disclosed.

Reports state that it’s “part of NTUC Enterprise’s social mission to ensure that cooked food remains affordable and accessible.”

Now you know you’ve not been reading gibberish earlier on: it’s all part of a bigger picture to make sure that our chicken rice stays $1.50.

Okays, maybe not $1.50, but definitely not $15.

(Article continues below) Xing Xing is a 34-year-old Singaporean lady who decides to meet up with an online friend she found in Facebook. But it turns out that he’s not what he seems to be: Prepare boxes of tissue and watch the saddest Singapore Facebook love story here:

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What’s Next

Kopitiam would still retain its brand, so you won’t be seeing as many NTUC Foodfare coffeeshops as NTUC FairPrice supermarkets. The two entities would still continue to operate separately, and nothing would change.

After all, think about it: the goal isn’t for more profits. It’s to keep prices affordable.

However, it’s not known if hawkers from Kopitiam would have to ensure that they have at least one affordable item in their menu. Currently, the benchmark for “affordable” is $2 a meal in NTUC foodfare coffeeshops and $2.80 a meal for a hawker centre they manage.

The Kopitiam card can still be used since operationally, there’s not much change.

According to an NTUC Enterprise spokesperson, both organizations would “work together to leverage mutual capabilities and seek out common opportunities for synergies, including the use of technologies.”

The deal would be sealed by the end of 2018.

Not sure about you, but this seems like good news #justsaying

I mean, $2 meal? I want lah.

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George Yang
Email: [email protected]