NB.... the boss still wears an Audemars Piguet watch lor.
Founder Bak Kut Teh Boss: "I Live In A HDB Flat, My AP Watch Is Second-Hand”
Popular F&B chain Founder Bak Kut Teh was mired in controversy yesterday (July 14), when it issued a plea on social media for customers to help save its floundering business. Speaking to
8days.sg, the restaurant’s second-generation owner Nigel Chua, 45, explains why he decided to call for public support, amidst netizens’ allegations of his lavish lifestyle (but more on that later).
In his open letter posted on Facebook and Instagram, Nigel reveals that the Covid-19 outbreak has been “the most difficult crisis” his family-owned biz faced since opening in 1978. He shares, “For the last five months, our sales have dropped tremendously by over 85%. If we don't turn around in the next two months, we will need to shut down. We sincerely seek your support to save our brand, the jobs of our employees and our heritage.”
He also explains that his family had tried to keep their business afloat by relying on takeaway and delivery orders. “But our efforts are still insufficient,” he says. “I am appealing to everyone for your support so that Founder Bak Kut Teh can continue to serve you and future generations for many more 42 years to come. We do not wish to close our doors but we desperately need your help.”
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“I live in a HDB flat”
In response to Nigel’s plea on social media, netizens left numerous comments on the posts alleging that he lives a lavish lifestyle. “In good times they made tons of money, driving big European branded cars, living in big landed properties and being served by maids and subordinates,” one Facebook user remarked. Meanwhile, another added: “There’s something wrong if they still drive a Ferrari and expect others who don’t even own such cars or luxury watches to help them just because their business aren’t [sic] doing well.”
In response to 8days.sg’s enquiries, Nigel clarifies over the phone that he lives “in a five-room HDB flat in Hougang”, though he owns three other condominium properties jointly with his father and older sister. As for the netizen’s claim that he drives a Ferrari, Nigel says: “I don’t even own a wheel from Ferrari (laughs).” Instead he drives “a Japanese car”, a Toyota Vellfire which he also bought second-hand. "I didn't reply [to the online comments] to defend myself, because it might make things worse," he shares.
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His Audemars Piguet watch is second-hand
The father-of-three (he has a son, 15, and two daughters, 14 and 8) also addresses claims about a luxury watch that he was wearing in a photo (see above) sent to the press, which sharp-eyed netizens identified as a model from Swiss fine watchmaker Audemars Piguet. According to Nigel, he had bought the watch “about six or seven years ago”. He paid around $14,000 for the “second-hand, used” model that he says would otherwise have cost over $30,000 brand new.
He elaborates, “I just bought one watch, with my hard-earned money. I’ve worked hard for so long and have some savings after taking care of my three kids. Everyone has their own hobbies, so I bought a watch to pamper myself. There’s nothing wrong with that. I didn’t borrow any money to buy it.” He says he typically works long hours every day, as the restaurants’ operations only wrap up by 2am. “I start at 9am and I have to be at Balestier by 6pm to take over from my dad [at the main shop], till 2am. I also accompany him to the other outlets, and ’m always running around to check on the food quality.”
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My father told me not to make an open plea”
Nigel’s father, Chua Chwee Whatt, 75, a former pig farmer who started the Founder chain, initially told his son not to issue an open letter calling for help. “He wanted to protect our ‘face’. He has passed the business to me, and if it fails, he will be very disappointed. So we want to continue fighting,” says Nigel. “I wanted to cry when I was writing this letter. I thought — will people attack me? Will they say this is a ploy for sympathy? But for my business, I put my pride aside. It takes courage to write a letter like that.” Being candid about his struggles, he reckons, also highlights local F&B owners’ challenges. “The letter lets people know that we F&B hawkers strive to make it step by step. Nothing falls into our lap from heaven,” he tells us.
Tourists make up the majority of Founder’s customers (which includes overseas stars like Jay Chou and Gillian Chung). Singapore’s border closure and the dearth of foreign visitors added to the restaurant’s financial losses. Pre-Covid-19 outbreak, Nigel says each of Founder's outlets typically rake in around $200,000 a month. Since February this year, revenue has dropped sharply to around $30,000 a month per outlet. “We closed our Balestier and Bugis outlets during the circuit breaker to save on manpower costs. We decided to close the flagship [in Balestier] ’cos my dad thinks that the quality for tapow-ed food is not very good. The soup will be cold, and some customers will find it troublesome to reheat it. So we thought, aiyah, just close,” says Nigel.
While they ran some promotions such as 10 percent off for self-collected orders and free islandwide delivery, response for takeaway was lacklustre. Nigel acknowledges, “Our food is more suitable for dining-in. We thought of using better quality containers so the food will be kept warm longer, but it cuts further into our costs.” The Balestier branch, which the senior Mr Chua oversees, had no promotions. "After my
As for customers’ feedback that Founder’s prices are too high, he says: “Maybe they don’t know that we use quality ingredients like fresh pork, which costs three times as much [as frozen pork]. Our margin would be too low [without our current prices]. But we will consider adjusting the prices in the future.”
He also admits that he “had a long chat with my dad about the food quality” following several online comments critiquing the drop in the restaurant’s standards. “In the next two months, we will reflect on this,” he says.
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On reserve funds and closing outlets
Netizens also floated the possibility of permanently shutting some of Founder’s four outlets in Singapore to save costs. “We have run these four outlets for so many years, so we want to save them as much we can in the next two months,” Nigel shares. Of the four outlets, two at Hotel Boss and Bugis are joint ventures with local F&B group Baoshi (behind fried chicken chain Monga). Founder also has three franchised outlets each in Indonesia, Vietnam and Taiwan, and another joint venture outlet in China.
The company has reserve funds, which Nigel says have been utilised since January this year when the Covid-19 pandemic started worsening. “We felt the effect from January, all the way till now. We closed two of our shops during the CB period, but we still paid 85% of our staff’s salaries. We only retrenched one staff member, when his contract was up. Government grants helped, but our running costs are just too high.”
