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Friday, February 23, 2024

Singapore’s food industry and market trends in the F&B sector

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If you’re new to Asia and want to sell your food there, Singapore is an excellent place to start. People are willing to experience new tastes and flavors because the country is a melting pot of many ethnicities. People can be waiting up for something exceptional since food is a national passion. What you’ll also notice is that if the product does well in Singapore, distributors in other Asian nations are more willing to market it.

Trends in the Singapore food and beverage industry

Monthly household earnings have risen dramatically in recent decades, and there are many educated and westernized customers, including middle-aged PMETs and a younger generation of PMETs. Professionals, managers, executives, and technicians are abbreviated as PMETs. PMETs in their forties and fifties have more money to spend on the industry, and their consumer tendencies are well-complemented by their refined sense of taste acquired primarily via travel. Because they grew up surrounded and affected by modern western cafés, social media, and their friends, the younger generation of PMETs in their twenties and thirties have made significant contributions to the food and beverage business.

The expatriate community

Singapore has managed to entice expatriates to make the city-state their second home. The majority of the foreigners were from Western countries. Another type of immigrant is the self-employed businessperson who invests in Singapore and hires Singaporeans. Foreigners can sample a variety of international foods and beverages from the country’s broad choices.

Growing number of inbound tourists

The number of tourists has increased throughout time as a result of the following factors:

Flights from nearby/neighboring nations are becoming more frequent.
The establishment of two casinos
Meetings, incentives, conferences, and exhibitions are becoming more common.
New tourism attractions are being developed.
It’s important to consider the following consumer trends:

Singaporeans lead busy lives and have little time to cook meals, so many prefer to eat on the move or buy processed and packaged foods.
Households have opted for Western-style foods as a result of Western influence. Instead of the traditional ones, they are ingesting more of them.

Singaporeans can afford to buy food and beverages regardless of how pricey they are because of their high wages.

The Singapore food industry

Market size

Singapore is unable to generate a sufficient amount of food. As a result, it has become one of the top importers of agricultural and processed goods in the world. Because of increased earnings and an influx of visitors, this consumption rate is only projected to increase.

Market structure

4 Major groups of food retailers in Singapore

  • Large retailers
  • Convenience stores
  • Petrol stations
  • Traditional stores

There is a huge number of retail outlets in Singapore at the moment.

Challenges

  • Retail growth is present but not as fast as expected.
  • Retails have also resorted to giving discounts in order to attract consumers.
  • Products which are poorly differentiated or are not well supported by marketing are facing challenges as well.
  • Market for staples is weak.
  • For new products, marketing and distribution is extremely high.
  • High costs involved when companies try to maintain shares and positions.
  • Changes in commodity and freight prices will have an impact on food sales – a concern for Singapore due its large imports.
  • Low consumer confidence resulting to bargain hunting/seeking.

Players

The key retail channels in Singapore are supermarket chains and hypermarkets and there are 3 major groups that operate these channels:

  • The Dairy Farm Group
  • FairPrice Group
  • Sheng Siong

Specialty and fine food in Singapore

Specialty stores in Singapore serve good delicacies at premium rates to affluent customers, and they have a modest market share.

Organic and natural foods in Singapore

The organic food market in Singapore is tiny, with rice accounting for the majority of sales. Singapore imports its organic food as well.

Ready meals in Singapore

Due to their hectic schedules, Singaporeans have been able to save time by purchasing ready-to-eat meals. This has given consumers additional opportunities to alter their perceptions of ready-to-eat meals.

Challenges

Singapore is a highly competitive market that presents a number of difficulties. The retail market is controlled by a few major grocery chains. Marketing and distribution costs are higher, and maintaining market share is always tough.

Importers and distributors are looking for suppliers who:

  • Deal with local demands for promotional campaigns.
  • Develop products and packages that fit local demand requirements. Typically package sizes are relatively big compared to the rest of the region
  • Have a product and brand that is unique enough to break into the market.
  • Be flexible in terms of returns and profit goals.
  • Adopt a medium to long term strategy and action plan to build their market in Singapore.

Although the market is competitive, the spin-off effect in other Asian countries can be substantial. Guidance from local market entry specialists is essential. Joining in a competition and winning an award can help you to find new market in Singapore. Join Singapore Awards 2022.

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