When coffee shops exchange hands for high prices, vendors will always worry about whether their rental prices will increase, while consumers will pray that the increased costs won’t get passed onto them through raised food prices.
For the coffee shop at Block 848 Yishun Street 81, which was sold at $40 million on 1 October this year, these worries are ever-present and troubling.
Judging from the headlines, it seems like everything apart from coffee and mixed vegetable rice is far game.
Who Purchased the Coffee Shop?
The Yishun coffee shop was bought by the local catering company Great Wall Group.
During an interview with Shin Min Daily News, Guo Guanhua, the Chairman of the Board of Directors of Great Wall Group, said that due to the increasing food prices and inflationary pressures, life is rather difficult for everyone right now.
For the sake of dispelling the doubts of the public, he admitted that after his Group takes over on 1 October, the prices for coffee and mixed vegetable rice (cai peng) will not increase.
Adjustments will be made to the rental prices, but he won’t be divulging the contractual details.
Reaction from the Yishun GRC
The astronomically priced sale of the coffee shop aroused the concern of Yishun GRC Member Chen Huimin.
On 22 June, she took to Facebook to talk about her worries regarding the rent of the stalls and the price of the food at the coffee shop.
Besides that, she pointed out there were five other coffee shops in the vicinity for the residents to choose from and if the stalls’ food prices are too high, they may lose their competitiveness.
At the same time, she hopes that the government will give more attention to the rent issue of small businesses. If the rent is too high, it will make it more difficult for small businesses to stay afloat.
When Chinese newspaper reporters approached Ms Chen for further elaboration, she stated that the Yishun coffee shop fetching such a high price is a testament to the location’s attractiveness and convenience.
Despite these two perks, she believes that residents will choose to go elsewhere if the food prices are too high.
She revealed that she has met Guo Guanhua for discussion recently, and the other party has promised to participate in all community assistance programmes in the future, which made her feel gratified.
“After negotiating with Guo Guanhua, I learned that forking out such a huge sum to buy the cofee shop was a business decision made by the group, and they’ve already considered the current price factor.”
Chen Huimin also mentioned that she became aware of Guo Guanhua’s background, where he started from a simple mixed vegetable rice stall 28 years ago. Having been in the stall owners’ shoes, he can empathise with the difficulties that small stall owners face.
Guo Guanhua came from an impoverished family in Malaysia. For the sake of lightening his parents’ burden of having to raise his six other siblings, he decided to drop out of school at 15 and follow his older sister to Singapore to earn a living.
He started his mixed vegetable rice business in a coffee shop in 1994. After relying on opportunities and hard work, his mixed vegetable rice business gradually became a F&B group that also dabbles in roasted meat, braised pork rice and seafood restaurants.
He serves and gives back to the community as well.
He has been the President of Singapore Modern Businesses Management Association, the Vice President of the Fenyang Kwok Association of Singapore, and Vice President of the Sian Chay Medical Institution.
In 2019, he received a President’s Public Service Medal.
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MPs: Rental Price Controls on Neighbourhood Coffee Shops
During the parliament session on Monday (4 July), four lawmakers have brought up concerns about coffee shops changing hands at high prices on the Order Paper. They hope that the government can step in to regulate food and rent prices for neighbourhood coffee shops
Yishun GRC MP Chen Huimin intends to ask the Ministry of National Development whether the government will consider introducing measures to control the rent of HDB coffee shop stalls to prevent high rental costs from being passed on to consumers.
She feels that it is important to address this matter as HDB coffee shops are “important eating places for the public”.
Additionally, West Coast GRC Member Wu Meixia, Ang Mo Kio GRC Member Nadia, and Bukit Panjang single constituency member Lian Ronghua, will also ask the government how it will ensure that neighbourhood coffee shops can continue to provide residents with affordable meals.
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