Last September, the young lad struck a cord with many Singaporeans when he rolled up his sleeves and went into the harsh world of selling bah kut teh in a Toa Payoh coffee shop. The Independent Singapore featured him in a report on Oct 4, 2013.
A first class honour graduate from the University of Manchester, Tan has been prepared to expand his small food stall to a new outlet in Lau Pa Sat this month.
But Tan, 28, is now ready to let it all go after five months in the hawker business.
“I get some applicants here and there. Some of them promised to turn up but never did. I had applicants who wanted to be paid daily, citing financial difficulties,” he says. Tan did manage to hire an applicant who was soon caught pocketing hundreds of dollars in cash.
Associate Professor of Department of Economics at the National University of Singapore Tilak Abeysinghe believes that “unless wages rise dramatically, it will be quite difficult for these coffee shop stall owners to hire workers. But raising wages will kill a lot of these industries.”
Abeysinghe says there is a huge demand for workers in the industry, but supply of workers is limited.
Tan says: “If I have to pay as much as S$3,000 in addition to CPF contribution for an employee and I need 2 extra staff, I do not know how I am going to manage that.
“In the end, we got to ask what is the price we [food stall owners] are willing to pay for labour and we have to balance that with our business operations.”
Tan says he has to be realistic about his situation. “It is not that we are not making enough of a profit. Everyone has a different level of aspiration. We are making a decent profit but if we cannot expand our business at a reasonable rate, then this endeavour might not be worthwhile,” he says.
“At some point we need to have a central kitchen and it is a pure cost centre. We need to have four to five outlets before we can break-even. But to expand my business, I need stall helpers. If it is going to take me one year to open one outlet then it would take me four years before I can even start making a profit to recoup my initial investment.”
He sighs as he says: “We would probably bleed to death before that happens.” Tan believes that foreign labour may alleviate the situation.
Tan wrote to the Ministry of Manpower on Jan 18, seeking answers to why food stalls are not given the same service sector ratio to hire foreigners as other food establishments. MOM got back to him on Jan 29 and said they needed more time to look into the matter.
Since setting up his stall, he has also noticed that the problem with local hires goes beyond pay.
“I remember one applicant. She said to me, ‘˜I would work if the kitchen is not open to the public. My friends live in Toa Payoh. I do not want to be seen by them,” he says.
“I can understand because like her, we are all image conscious whether we admit it or not. There is a stigma attached to this job. I understand many people would consider our work as a dirty job.
“People tell me that if you pay enough, the extra dollar can compensate for these factors but can it really?”