Running any kind of business is difficult, but running a family business in the F&B sector can be a real challenge. In Singapore, only 54% of all family businesses make it to the second generation, and only 12% to the third. This, in the context of a transitioning time in the economy of Singapore as well as a great Western influence, makes it more important to identify and fulfil the needs of a family business.
What are the key factors of running a family business?
To begin with, we can not overlook the importance of family values for family businesses. The relationship between generations, the care of not hurting the others and the understanding between the members of the family can be burdens or huge advantages.
When it comes to F&B businesses, everything tends to move very quickly. The clients that come in want to be served as soon as possible, and the food needs to be cooked very fast, but in a delicious way. This means that everyone needs to be able to put their personal problems aside, including the relationship they have with their family if it's not the best, and focus on the clients.
No matter how much they try, things can get difficult to manage at times. Everyone has their own priorities, and when your boss is your parent and not a complete stranger, you tend to be less aware of your work duties and expect them to be more flexible with your desires.
The main question to ask ourselves: Is there a solution to keep everyone happy and prevent family members from arguing about the financial aspects of the business?
How to make sure that a family business is successful?
There is a common mistake that many businesses make, especially family businesses. They rely and count on each other, and more often than not there is more than one generation involved. However, they forget that their actions need to be professional, along with the equipment they have in their establishment.
Although things may work fine without professional equipment, at some point it is absolutely necessary to use the same technologies to boost the efficiency of your operations. These technological upgrades will prevent mistakes, make the entire process much easier and eventually, bring more profit in the long run. Although the initial investment may seem pricey.
Investing in a software that makes ordering, paying and keeping track of the paperwork an easy task would lessen the burden of making mistakes in data-entry and calculations. By relying on technological tools to automate this instead of using the traditional pen and paper methods for taking orders and invoicing, it will remove operational roadblocks for the business in the long run.
With software such as FoodRazor, you can forget about making such menial mistakes. Almost every process in the management of the restaurant’s back-of-house can be digitized, from the moment the suppliers send in the invoice to the financial inventory at the end of each week. Things like not knowing that food prices have increased or even forgetting that you need to order more vegetables will never happen again.
Need something to track food prices? Or negotiate better deals with suppliers?
We have tools from daily price increase notifications to reports that identify the top 10 products taking up most of your food spending. These insights are here for you to understand what you’re spending on and how you can minimize costs and maximize profits!
This will not only be beneficial for the business part but will also help maintain good relationships between family members. Tensions can rise quickly when there are mistakes because others point them out and some may get frustrated. There will never be tensions like this again because someone forgot an order or forgot to key in one line from the invoice; the software will accurately resolve this problem.
Also, using software eliminates almost completely overspending. By being able to track your expenses, money flow and how much goes into different types of foods, you can easily adjust the current spending and make sure that you are optimising your operations.
A great example of how a family business can succeed is our very own local business; Jumbo Seafood Restaurant. Today, it is one of the most popular F&B businesses, but back when it started in 1987, it wasn’t the case. The restaurant business was the idea of Mr Ang Kiam Meng’s (current CEO) father and a group of friends, who bought a small, struggling restaurant and hired a professional manager to attempt to bring it to the top.
Things didn't go as planned and in 1989, Mr Ang’s father took over the role as the manager because the previous hire did not perform well. In 1993, Mr Ang decided to open a branch of the restaurant on his own although he only had working experience in an engineering company. Needless to say, the business struggled, and although there were overseas expansion ventures, they failed and they had to restructure the company and invest in a food technology consultant and central kitchen.
Years later, Mr Ang, his father, an uncle, his wife, and two sisters, as well as his eldest child, are working together to ensure the prosperity of the restaurant. They have five outlets in Singapore and three in China, and they plan to maintain their name for many generations to come.
They believe that the recipe to their success was the fact that as a family, it was much easier for them to make unanimous decisions that would ultimately benefit the business. A family is able to make quick decisions and they push each other to work hard and take advantage of any opportunity.
Is upgrading the business a must?
Yes, it is. The competition within the F&B market is huge and there are new, modern restaurants opening every single day. Clients don’t always understand the family values that you build your business on; they do understand, however, how long it takes for them to get their order if the service is flawless or not and if there are often mistakes or not.
You shouldn’t be afraid that you will lose the foundation of your business by adopting new technologies. If anything, you will just strengthen familial relationships and the camaraderie between members.
More tips: Many factors contribute to a successful F&B business. Click here to find out how to keep your manpower lean in your F&B business and cut costs.