Singapore’s renowned hawker culture is not only a source of national pride but also a fantastic business opportunity for aspiring entrepreneurs looking to break into the Food & Beverage (F&B) industry. In fact, Singapore’s hawker culture has been officially recognized by UNESCO as an Intangible Cultural Heritage of Humanity, highlighting its importance in the daily lives of Singaporeans. Beyond its cultural significance, the hawker business model provides a viable and cost-effective alternative to running a full-fledged restaurant, making it an attractive option for those seeking to start their own F&B venture.

The Benefits of Starting a Hawker Stall in Singapore

While opening and running a restaurant can be appealing, the high start-up and operational costs often make it a significant financial commitment. Restaurants require substantial investment in rent, furnishings, staff, and food supplies, and overheads can add up quickly. In contrast, hawker stalls offer a more affordable way to enter the food business without having to break the bank. Hawker centers are generally located in residential areas, which means you can capitalize on the steady flow of customers while enjoying a more manageable rent compared to restaurants located in prime city locations.

Another significant advantage of running a hawker stall is Singapore’s long-standing street food culture. Hawker food is deeply ingrained in the daily lives of Singaporeans, and the local community continues to support this tradition. As long as you deliver on quality, taste, and service, you’ll likely find a steady stream of customers. In addition, Singapore’s hawker centers attract both locals and tourists, creating diverse opportunities for growth. Given this cultural importance and lower financial risks, running a hawker stall becomes an appealing option for F&B entrepreneurs.

But how exactly does one go about starting a hawker stall? Here, we provide a comprehensive step-by-step guide to help you navigate the process and realize your dream of becoming a hawker stall owner.

Step 1: Are You Eligible to Start a Hawker Stall?

Before you can even begin planning your hawker stall, you must first determine whether you’re eligible to run one. The eligibility criteria for starting a hawker stall in Singapore are fairly straightforward. You need to meet the following requirements:

• Be a Singapore citizen or a Permanent Resident.
• Be 21 years of age or older.

However, there are a few restrictions to be aware of. You may not be eligible if you fall into one of the following categories:

• You are a former assistant or nominee who has never been de-registered by the National Environment Agency (NEA).
• You are an undischarged bankrupt.
• You are currently renting or co-operating two cooked food stalls managed by the NEA.
• You are banned by the NEA or any government statutory board from participating in business tenders.

If you meet the eligibility requirements, congratulations! You’re one step closer to becoming your own boss.

Step 2: Understanding Your Opportunity Costs

Opportunity cost is a critical concept in economics, especially when it comes to starting a business. It refers to the value of what you’re giving up in order to pursue a specific venture. In the case of opening a hawker stall, you might be giving up other employment opportunities or even a more traditional career path in exchange for the chance to run your own business.

If you have little or no experience in the F&B industry, you’ll need to acquire knowledge about the trade before diving in. This might mean spending time learning from existing hawkers, participating in cooking courses, or working in restaurants to gain first-hand experience. Another requirement for operating a hawker stall is completing the Basic Food Hygiene Course (BFHC), especially if you plan on selling cooked food. This course is mandatory and ensures that all food handlers adhere to health and safety standards. Your assistants will also need to complete this course before they can work alongside you.

Since the process of gaining experience varies from person to person, it’s hard to pinpoint a specific cost for this stage. However, investing in the right training and skills will pay off in the long run as it sets the foundation for running a successful hawker stall. Additionally, you will need to apply for a Hawker License before officially operating your business.

Step 3: Bidding for a Stall Under NEA’s Tender Process

Once you’ve gained the necessary experience and qualifications, the next step is securing a hawker stall to call your own. Most hawker stalls in Singapore are managed by the National Environment Agency (NEA), and acquiring one involves submitting a bid during the monthly tender process. Tenders are usually held from the 16th to the 26th of each month, and the highest bidders are awarded the stalls.

To participate in the tender process, you will need to purchase a tender form and submission envelopes from NEA’s One-Stop Information and Service Centre (OSISC) at the HDB Hub East Wing for $10. Additionally, you’ll need to prepare a cashier’s order from a bank and ensure that all necessary paperwork is completed.

The bid amount for each hawker stall can vary greatly depending on factors such as location and size. On average, successful bids for hawker stalls managed by the NEA fall around $1,500, though this amount can fluctuate. Remember, while it may be tempting to bid high to secure a prime stall, overbidding can lead to higher monthly rental costs, which may eat into your profits in the long run. Therefore, it’s essential to conduct research on previous bid amounts and carefully calculate your budget.

Step 4: What Happens After Bidding?

If your bid is unsuccessful, don’t worry! The NEA will return your cashier’s order 3-4 weeks after the closing of the tender. On the other hand, if your bid is successful, you’ll receive a Letter of Offer from the NEA within the same timeframe. This letter officially grants you the right to rent the stall for three years. You’ll also be notified of the date for signing the tenancy agreement.

At the time of signing the tenancy agreement, you will need to make the following payments:

• First month’s stall rental: Estimated at $1,500 based on your bid.
• First month’s Service & Conservancy Charges (S&CC): Approximately $210.
• Deposit of two months’ rent: Estimated at $3,000 to cover the first two months of operations.
• Hawker License: Valid for three years, costing about $39.
• Table cleaning fees (for cooked food stalls): Around $600.
• Stamp duty: Additional legal cost depending on the agreement.

In total, expect to pay an estimated $5,349 upfront when signing the tenancy agreement. Following this, you’ll have three months to get your stall up and running.

Step 5: Setting Up the Stall and Managing Operating Costs

Now that you’ve secured your hawker stall, it’s time to set it up and prepare for operations. The largest portion of your start-up costs will likely go towards purchasing kitchen equipment, furniture, and other materials necessary for running the business. Equipment such as stoves, ovens, preparation surfaces, and utensils will form a significant part of your investment.

Here’s a breakdown of some of the key items you’ll need:

• Kitchen equipment: Ovens, stoves, microwaves, etc.
• Metalwork: Food preparation surfaces, tables, kitchen counters, hoods.
• Utensils: Cups, plates, bowls, cutlery.

Based on current market prices, you can expect to spend anywhere from $10,000 to $12,000 on setting up your hawker stall.

Once your stall is up and running, you’ll also need to factor in monthly operating costs. These include rent, table cleaning services, refuse disposal, raw materials, and staff salaries. On average, monthly expenses can range between $12,500 and $17,100, depending on the scale of your operations. If you’re able to serve around 200 customers a day, with an average purchase of $5 per customer, your revenue could potentially reach $22,000 per month.

Step 6: Leveraging Government Grants and Schemes

To support small businesses and start-ups, the Singaporean government offers a variety of grants and schemes that you can take advantage of as a hawker stall owner. These include:

• Incubation Stall Programme: Aimed at new hawkers, this programme provides opportunities to test your business idea at a lower cost.
• Productivity Solutions Grant (PSG): Helps businesses adopt technology solutions to enhance productivity.
• Hawker Productivity Grant: Specifically designed to help hawker stall owners invest in automation and improve efficiency.
• Hawker Development Programme: Provides training and mentorship to aspiring hawkers.
• Inclusive Growth Programme: Helps small businesses improve productivity and enhance employee well-being.

These grants and schemes can provide much-needed financial support and resources to help you kickstart and grow your hawker business.

Conclusion: Reducing Startup Costs with Kitchen Union

Singapore’s hawker culture presents a rich opportunity for entrepreneurs to start their own business in the F&B industry. By following the steps outlined above, you’ll be well on your way to owning and operating a successful hawker stall.

However, managing startup and operational costs can be a challenge, especially when setting up your stall. That’s where Kitchen Union comes in. As a boutique firm specializing in affordable, high-quality kitchen equipment, we are committed to making your journey to becoming a hawker more financially manageable. By offering an extensive range of kitchen tools and equipment at competitive prices, Kitchen Union can help bring a portion of your start-up costs down, allowing you to focus on delivering delicious food to your customers. Explore our shop today and discover how we can support your hawker business dream!