Calculated Misery: Sign of times

Flash Coffee Exits Singapore, indicating Challenging Market Conditions

Popular coffee chain Flash Coffee has announced the closure of all 11 of its outlets in Singapore. This marks yet another setback for the food and beverage (F&B) industry, which has seen several major brands shutter local operations recently.

Founded in 2020, Flash Coffee quickly gained popularity in Singapore for its convenient locations, affordable prices, and wide selection of coffee, tea and snacks. Long lines were a common sight at its outlets across the island pre-pandemic.

However, in a statement, Flash Coffee cited “doubling down on most promising markets” as the key reason for consolidating. Singapore is the only country where the chain has ceased operations entirely.

The closure comes despite Flash Coffee having raised US$50 million in Series B funding just three months ago in May 2023. The capital was meant to aid its regional expansion plans.

Flash Coffee is not the only F&B casualty in Singapore in recent times. In August 2023, homegrown franchise operator Deelish Brands shut down a number of its restaurant concepts including Fatburger, Buttermilk Chicken & Waffles and 800 Degrees Pizza. Rising costs, manpower constraints and weak consumer demand were reportedly key reasons.

Industry observers note that the F&B sector has been badly affected by the pandemic, with buffet operators, caterers and dine-in restaurants struggling with safe distancing and crowd control measures. Lacklustre tourism has also impacted revenues.

On top of this, rising inflation, labour shortages, stiffer competition and consolidation in the market may have added to cost pressures for F&B businesses. Many are finding it an uphill task to break even.

The abrupt departure of Flash Coffee is a red flag for the industry here. More closures could occur if operating conditions remain challenging. To stay resilient, F&B players may need to relook menus, operating models and digitize operations. Adapting quickly to the post-pandemic environment will be critical to survival.

While the closure of Flash Coffee is disappointing, observers hope it can spur innovation and grit among surviving players. The F&B sector remains an integral part of Singapore’s economic and cultural fabric. With some rethinking, brands can overcome immediate challenges and thrive again.

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This is a series focusing on Calculated misery in our Society.

1) Calculated Misery - Social media

2) Calculated Misery - Oppression

3) Calculated Misery - Budget airlines

4) Calculated Misery - Sign of the times