No more new TungLok restaurants
Rebecca Lynne Tan | The Straits Times | Tue Feb 26 2013
Mr Andrew Tjioe, executive chairman of TungLok Group, says the company has spent more on automation to reduce reliance on manpower.
Singapore, February 26, 2013
Who: Mr Andrew Tjioe, 54, executive chairman of TungLok Group, which runs 25 restaurants islandwide including Tung Lok Signatures, Tong Le Private Dining, My Humble House and Lao Beijing.
To cope with the manpower shortage, the TungLok Group closed its casual restaurant Lao Beijing at Tiong Bahru Plaza last December.
A sign on the shutters reads: "We regret to inform that Lao Beijing at Tiong Bahru Plaza will cease operations with effect from Dec 26 due to severe manpower shortage."
Diners after the chain's Northern Chinese cuisine now have to head to Lao Beijing's three other outlets.
The restaurant at Tiong Bahru Plaza still had another four months left on its lease, but Mr Tjioe and his team did the calculations and says it made more sense to close the restaurant and re-deploy the 16 staff to his other restaurants.
Part of the reason he is not renewing the lease there is due to a lack of manpower. Other factors include rising rentals.
He says: "It was a trade-off - we did the sums. It was better to pull the staff over so that we would be able to operate our new restaurants TungLok Xihe and Modern Asian Diner at The Grandstand than to continue at Tiong Bahru Plaza. So I decided to close."
The average spend at Lao Beijing there was about $20 to $25 a person, but at the two new mid- to upper-mid-tiered restaurants, the average cheque is about $30 to $35 for lunch, and $50 to $55 for dinner.
The TungLok Group operates on "a skeleton workforce", says Mr Tjioe.
Even with the group's 700-strong workforce, which is equally split between kitchen and service staff, it is still about 20 per cent short of staff.
And when the Ministry of Manpower's revised dependency ratio ceiling kicks in next year, the group may find itself with about 30 foreigners too many if it does not ramp up the hiring of Singaporeans.
But that is proving to be a challenge.
This year, the plan is to consolidate and strengthen the running of existing outlets, focus on its catering arm and plan for overseas expansion in cities such as Jakarta and Beijing. The group has one restaurant in Beijing and three in Jakarta.
He does not face the same manpower issues overseas as he does here. He says: "As long as you are willing to pay, you will get the manpower you need."
In Singapore, he adds, it is a different story. The starting pay for service staff without experience is $1,800, by far one of the highest in the market. Recently, the company received 20 applications from Singaporeans, but only one person took up the position.
"The problem is choking," Mr Tjioe says of the manpower crunch in the restaurant scene. "We have been doing business overseas anyway but perhaps now, that is the way to go - to spend more time exploring overseas markets than wasting time here.
"I will not be opening any more restaurants for a while. I have to stop, not because there are no opportunities but primarily because of the labour shortage. The market can definitely afford to have more restaurants."
The company has already spent about $2 million to $3 million on machines over the last two years to help with automation to reduce the reliance on manpower at restaurants.
For example, TungLok's popular pork shank, which is available at many of its restaurants, is marinated in bulk at the group's 20,000 sq ft central kitchen in Bukit Batok. In fact, Mr Tjioe says, for some items such as the pork shank, preparing them in bulk adds to intensity of flavour to the dish.
Aside from machines for sauces and marinades, he also has one that can make superior stock in one hour, as opposed to the usual eight hours it would take to prepare it at an outlet.
While technological advancements and machines such as these aid productivity, he insists that it is not always achieved through these means.
"When you have more manpower, you can send some staff for training and they can take turns. You will then have much better quality staff in the long run," he says, adding that well-trained staff lead to better efficiency and more sales.
But he says, sending staff for training can be tough "when you are tight on manpower".
Profits are also shrinking, with manpower and rental and the costs of ingredients on the rise. But these costs cannot be passed on in full to customers, because of the competitive restaurant market.
A whole fried chicken, Mr Tjioe gives as an example, typically costs $40 at most Chinese restaurants, and if a restaurant is to increase this price, diners will go elsewhere for the same dish.
What can be done, he says, is to create different "value-added" dishes by adding additional ingredients so that the dish changes into something new and a higher price may be warranted.
Chinese restaurants also function differently from Western ones in terms of culture. Meals typically call for more plate changes and more frequent topping up of small tea cups, and for managers to mingle with diners, offering a more personalised service.
He adds: "We are not just competing locally, we are also competing on an international level.
"When those who have been served in Chinese restaurants in Hong Kong, Shanghai and Taipei come to Singapore, they expect exactly the same experience, and we cannot be too far off."
Rebecca Lynne Tan | The Straits Times | Tue Feb 26 2013
Mr Andrew Tjioe, executive chairman of TungLok Group, says the company has spent more on automation to reduce reliance on manpower.
Singapore, February 26, 2013
Who: Mr Andrew Tjioe, 54, executive chairman of TungLok Group, which runs 25 restaurants islandwide including Tung Lok Signatures, Tong Le Private Dining, My Humble House and Lao Beijing.
To cope with the manpower shortage, the TungLok Group closed its casual restaurant Lao Beijing at Tiong Bahru Plaza last December.
A sign on the shutters reads: "We regret to inform that Lao Beijing at Tiong Bahru Plaza will cease operations with effect from Dec 26 due to severe manpower shortage."
Diners after the chain's Northern Chinese cuisine now have to head to Lao Beijing's three other outlets.
The restaurant at Tiong Bahru Plaza still had another four months left on its lease, but Mr Tjioe and his team did the calculations and says it made more sense to close the restaurant and re-deploy the 16 staff to his other restaurants.
Part of the reason he is not renewing the lease there is due to a lack of manpower. Other factors include rising rentals.
He says: "It was a trade-off - we did the sums. It was better to pull the staff over so that we would be able to operate our new restaurants TungLok Xihe and Modern Asian Diner at The Grandstand than to continue at Tiong Bahru Plaza. So I decided to close."
The average spend at Lao Beijing there was about $20 to $25 a person, but at the two new mid- to upper-mid-tiered restaurants, the average cheque is about $30 to $35 for lunch, and $50 to $55 for dinner.
The TungLok Group operates on "a skeleton workforce", says Mr Tjioe.
Even with the group's 700-strong workforce, which is equally split between kitchen and service staff, it is still about 20 per cent short of staff.
And when the Ministry of Manpower's revised dependency ratio ceiling kicks in next year, the group may find itself with about 30 foreigners too many if it does not ramp up the hiring of Singaporeans.
But that is proving to be a challenge.
This year, the plan is to consolidate and strengthen the running of existing outlets, focus on its catering arm and plan for overseas expansion in cities such as Jakarta and Beijing. The group has one restaurant in Beijing and three in Jakarta.
He does not face the same manpower issues overseas as he does here. He says: "As long as you are willing to pay, you will get the manpower you need."
In Singapore, he adds, it is a different story. The starting pay for service staff without experience is $1,800, by far one of the highest in the market. Recently, the company received 20 applications from Singaporeans, but only one person took up the position.
"The problem is choking," Mr Tjioe says of the manpower crunch in the restaurant scene. "We have been doing business overseas anyway but perhaps now, that is the way to go - to spend more time exploring overseas markets than wasting time here.
"I will not be opening any more restaurants for a while. I have to stop, not because there are no opportunities but primarily because of the labour shortage. The market can definitely afford to have more restaurants."
The company has already spent about $2 million to $3 million on machines over the last two years to help with automation to reduce the reliance on manpower at restaurants.
For example, TungLok's popular pork shank, which is available at many of its restaurants, is marinated in bulk at the group's 20,000 sq ft central kitchen in Bukit Batok. In fact, Mr Tjioe says, for some items such as the pork shank, preparing them in bulk adds to intensity of flavour to the dish.
Aside from machines for sauces and marinades, he also has one that can make superior stock in one hour, as opposed to the usual eight hours it would take to prepare it at an outlet.
While technological advancements and machines such as these aid productivity, he insists that it is not always achieved through these means.
"When you have more manpower, you can send some staff for training and they can take turns. You will then have much better quality staff in the long run," he says, adding that well-trained staff lead to better efficiency and more sales.
But he says, sending staff for training can be tough "when you are tight on manpower".
Profits are also shrinking, with manpower and rental and the costs of ingredients on the rise. But these costs cannot be passed on in full to customers, because of the competitive restaurant market.
A whole fried chicken, Mr Tjioe gives as an example, typically costs $40 at most Chinese restaurants, and if a restaurant is to increase this price, diners will go elsewhere for the same dish.
What can be done, he says, is to create different "value-added" dishes by adding additional ingredients so that the dish changes into something new and a higher price may be warranted.
Chinese restaurants also function differently from Western ones in terms of culture. Meals typically call for more plate changes and more frequent topping up of small tea cups, and for managers to mingle with diners, offering a more personalised service.
He adds: "We are not just competing locally, we are also competing on an international level.
"When those who have been served in Chinese restaurants in Hong Kong, Shanghai and Taipei come to Singapore, they expect exactly the same experience, and we cannot be too far off."
