Record closures reshape Singapore’s dining landscape
The Singapore food and beverage (F&B) sector is undergoing a seismic shift as rising living costs tighten consumer wallets. Data from 2024 show that more than 3,000 restaurants shut their doors, the highest annual tally in nearly two decades. The trend has carried into 2025, signaling structural pressures that go beyond temporary market fluctuations.
Profitability crisis: 82% of closed outlets never made a profit
Industry analyses reveal a troubling pattern: a large majority of closed outlets were not profitable. In fact, about 82% of the outlets that closed had never achieved profitability. This statistic underscores how fragile some business models are in the current environment, where rental costs, labor pressures, and supply chain costs bite into margins. For operators, the challenge is not merely attracting customers but building sustainable profitability in a highly competitive market.
Rising costs and changing consumer behavior
Inflation and wage growth have squeezed consumer discretionary spend. At the same time, rents in prime dining districts remain high, and energy costs have surged. Together, these factors reduce per-item margins and make it harder for new entrants to reach profitability quickly. The result is a wave of closures as operators reassess location strategies, menu pricing, and operating hours to align with evolving consumer behavior.
Grab CEO Anthony Tan’s call to upskill for drivers
Amid these broader shifts, Anthony Tan, co-founder and CEO of Grab, has called on drivers within Grab’s ecosystem to upskill. Tan argues that as the job landscape evolves, drivers who expand their skill sets—whether in customer service, safety, navigation efficiency, or basic business literacy—will be better positioned to capitalize on opportunities in a converging gig and fintech-enabled marketplace. The message highlights the importance of adaptability for gig workers who may be affected by fluctuations in the restaurant and retail sectors.
Why upskilling matters in Singapore’s gig economy
Upskilling isn’t just about higher earnings; it’s about resilience. For drivers, improved skills can lead to steadier demand, higher tips, better safety records, and access to more sophisticated platform features. For platforms like Grab, driver upskilling can translate into improved service quality, faster deliveries, and greater customer satisfaction—factors that help sustain demand in a tight market.
What this means for operators and workers
Operators face a double bind: close underperforming venues while seeking new models that deliver value. Concepts such as ghost kitchens, smaller-format outlets, and localization of menus are part of the strategy to reduce fixed costs while maintaining revenue streams. For workers and gig collaborators, the emphasis shifts toward continuous learning, flexible career planning, and leveraging technology to stay competitive in a market where traditional boundaries between sectors are blurring.
What to watch next
Policymakers, lenders, and business leaders will likely intensify focus on sustainability in the F&B sector. Expect further experimentation with pricing models, delivery consolidation, and cost-control measures. As consumer budgets tighten, the ability of businesses and workers to adapt—with upskilling at the core—will be a key determinant of who survives and thrives in Singapore’s evolving economy.
Practical takeaways for drivers and restaurateurs
Drivers: Seek training in safety practices, efficient routing, basic financial literacy, and excellent customer service. Restaurateurs: Revisit cost structures, diversify sales channels, and consider alternative formats such as delivery-first concepts to weather volatility.
Conclusion
Singapore’s record restaurant closures in 2024—and the ongoing 2025 figures—signal an urgent need to rethink profitability strategies across the F&B sector. With leaders like Anthony Tan urging upskilling for drivers, the path forward combines workforce development with innovative business models that can help both gig workers and traditional operators navigate a challenging economic landscape.
