Foresight in spotting a business opportunity can be a tricky thing. It takes a shrewd eye to spot trends backed by statistics and figures, and a dose of faith to believe in the product, even when the market doesn’t seem to take to it at first. As early as six years ago, several companies saw the tremendous potential in providing cost-effective digital solutions in the food and beverage (F&B) as well as hospitality sectors.
The push for digitalisation in these high-touch industries was nascent then, and few players saw the urgency to give it serious thought, much less implement digital solutions. Restaurants were enjoying healthy dine-in crowds and did not see online orders and deliveries as essential to their bottom line. Hospitality brands equated contactless technology with
a lack of personal service.
As costs were also prohibitive, only the big hotel brands could traditionally invest millions of dollars in new technology. It took a pandemic for these perspectives to change. Eateries and hotels were forced to close and countries imposed travel restrictions. In the pall of empty rooms and tables, it suddenly dawned on the hospitality and F&B industries that they had to pivot digitally – and fast.
Not necessary, not now
Maxim Tint’s digital solution provider GTriip had a practical beginning. He was so fed up with filling up forms at hotels and immigration checkpoints during his travels that he decided to come up with a safe, cost-effective and environmentally friendly solution that tapped on an item everyone would carry.
The AI-powered and cloud-based software instantly verifies a guest’s identity via a smartphone selfie, which is matched against a passport image, before issuing a digital key for room access. A guest can literally zip to his room upon arrival at a hotel, adjust the room’s controls, order room service and contact the concierge from his mobile device.
It was a game changer in eradicating long queues (studies show that a five-minute wait at the check-in counter can result in a 50 per cent drop in guest satisfaction) and the need for physical check-in kiosks. Yet CEO Tint had a hard time convincing hotels to take it up, even after assuring them that they would have 100 per cent control over data security and ownership, monetary transactions would be encrypted, and that it presented them with a big opportunity to upsell and cross-sell the hospitality experience.
“Before Covid-19 happened, the hospitality industry wanted as many touchpoints as possible,” said Tint, who started the company in 2014. “While a sizeable budget was allocated for digital marketing and social media strategies to stay ‘top of mind’ with guests, hotels perceived our contactless solution as a good-to-have instead of a must-have feature.” Jonathan Lim hit similar walls when he started Oddle in 2014.
The year before, he and two other co- founders had knocked on the doors of restaurants in Telok Ayer, asking if they needed an online ordering system. Responses were mostly affirmative, but there were few takers when Lim presented the Oddle online ordering platform, which could be white-labelled to a restaurant’s brand so that the latter could grow its own customer database.
“They would tell me things like ‘I’m quite busy with dine-in so that’s not our priority now’ or ‘Nobody would order food online’ or ‘I don’t have the manpower to do it’. But I was sure our system was vital because of my own experience in running a restaurant,” said Lim. The opportunity in deliveries and “digital-first restaurants” was also not lost on Phuminant Tantiprasongchai, who started food tech disruptor Tiffin Labs in 2019 with three others, including Kishin RK, the billionaire CEO of local real estate acquisition and development company RB Capital.
The mission: to re-engineer the food ecosystem so people could enjoy the best home dining experiences from the nearest kitchen within a 3km to 5km radius. “For a long time, restaurants looked at delivery as an add-on to the existing business. But we saw an increasing amount of under-utilised real estate globally, especially kitchens, and, on the other end, the number of people ordering food delivery was increasing tremendously,” said Tantiprasongchai, who was previously the head of strategy and partnerships at Grab Thailand. “The digitisation of the restaurant industry was happening, and not just in a specific country or region, but globally.”
“They would tell me things like ‘I’m quite busy with dine-in’ or ‘Nobody would order food online’. But I was sure our system was vital because of my own experience in running a restaurant.”
Jonathan Lim on the challenges oddle faced in the beginning
A July 2020 Euromonitor report forecasted that ghost kitchens could create a US$1 trillion (S$1.39 trillion) global opportunity by 2030. Already, global food delivery sales have more than doubled from 2014 to 2019, and 52 per cent of global consumers
are comfortable ordering from restaurants with no physical outlets and only delivery service. Tantiprasongchai said: “To capitalise on this, we felt the F&B ecosystem needed an entirely new thought process. The way food is consumed via delivery is different from the way it is consumed in a restaurant.”
Full steam ahead
When the coronavirus pandemic hit, the trudge to digitally onboard services suddenly became a sprint to meet demand. Half of GTriip’s total of one million check-ins to date occurred this year alone. Tint told us enquiries for its software tripled from an average of three per week to 10 in the last three months. It is currently serving over 25,000 hotel rooms in over 20 properties worldwide, including Amara Sanctuary Resort Sentosa, Grand Park City Hall, two major casino-resort groups in Singapore and Macau, and properties in the Philippines and Thailand.
In February, GTriip secured an undisclosed mid-seven figure US dollar sum in Series B funding with investors such as Keppel Corporation’s wholly-owned subsidiary Kepventure and Japanese venture capital firm Global Brain through the KDDI Open Innovation Fund No. 3 (KOIF). In Singapore, GTriip’s customer hotels are enabled with the Singapore Tourism Board’s E-Visitor Authentication (EVA) system, which uses biometric facial recognition to verify identity during check-in. This reduces processing times by 70 per cent.
Its software subscription fee is listed at US$5 per room per month, with payment made annually. Depending on market conditions, local labour costs, and whether it is a group level partnership, the fee could be lower. “Our hotel customers are adopting our contactless check-in software because it cuts down guest check-in time from an average of 10 to two minutes.
With the optional mobile key feature for some hotels with smart locks, it could be as fast as 30 seconds as we can send the room key to the guest’s phone even before he or she arrives at the hotel,” Tint said, adding that creating a proprietary product themselves could potentially cost hotels millions of dollars, not to mention the need to hire people to manage it. It is now working with the National University of Singapore to apply a commercial variant of its software for 10,000 hostel rooms on its campus, and has service apartments and co-working spaces on its radar.
“The way that digital-first restaurants are marketed and have their products consumed will have its own economy. What we are seeing is a shift that would have taken place anyway.”
Phuminant Tantiprasongchai of tiffin labs on the rise of dark kitchens
Tint said: “We want to stay focused on functions related to digital identity instead of being a company that provides all kinds of services for a property. The aim is to scale our primary hospitality product to a broader definition of commercial real estate that includes tenant and visitor management.” Tiffin Labs is adopting an “asset light, highly scalable” model for its kitchens by partnering real estate landlords. It recently announced its acquisition of access to over 1,000 kitchens across the United States,
Europe and Asia. Deliveries from these kitchens are set to begin in the fourth quarter of this year.
In Singapore, it already has nine “digital-first” restaurant brands, including Publico Express Pasta Bar and Pizzeria, Huraideu Fried Chicken and Singapore Makan, while a newly opened research and development laboratory serves as the curation hub for its delivery cuisines around the world.
Tantiprasongchai said: “The strategy is to capitalise on data analytics and AI to gain a precise understanding of what the consumer wants in every country and neighbourhood market, then debuting the brand that meets those preferences.” The logistics aspect will be fulfilled by the delivery partner who can most efficiently serve that district. But this doesn’t mean that brick
and mortar restaurants will lose their place, he emphasised.
“They will still be relevant as long as they can provide the experience. The way that digital-first restaurants are marketed and their products consumed will have its own economy. What we are seeing is a shift that would have taken place anyway. It’s simply accelerated because of the pandemic. People are taking to food delivery and the digital dining experience in higher numbers and at a higher frequency.”
This exponential pace was also reflected in Oddle, when it onboarded more than 500 new restaurants and F&B groups to its online ordering platform in April alone – a huge spike compared to its average of 40 to 50 per month pre-pandemic. “It was crazy,
especially during the first two weeks of the circuit breaker period. We were working up to 20 hours a day. That’s when we realised it was no longer just about making money but saving F&B as an industry.”
Oddle, which operates on a cloud solution, is currently used by nearly 5,000 partners in Malaysia, Taiwan, Hong Kong and Singapore, including 1,500 restaurants locally. What really made people sit up and notice was when high-end groups such as Unlisted Collection and The Lo & Behold Group, who are behind Michelin-starred restaurants such as Burnt Ends and Odette, also hopped on.
Lim said that the company prefers to take on the role of co-partner with clients. It takes a 10 per cent commission of actual online sales (including a 3.5 per cent fee that goes to the payment gateway and customer support costs), which is much lower than the 30 to 35 per cent required by other delivery providers. As different needs came up, Oddle swiftly evolved and became more than just a technological solution to capture organic sales. It found delivery partners in each market to prop up logistical manpower shortfall and included system functions such as the generation of sales reports and limiting orders to ease operational flow during peak hours.
Lim himself has personally taught clients how to optimise the system, helping them to achieve as many as 10 times more in sales.
“We guide them on service recovery and advise them on how to optimise their menus and pricing. If there’s an additional digital marketing budget, we could even do things like run Facebook ads and design electronic direct mailers. We play the long game for them. Just think of us as the super intern you always wished you had,” Lim laughingly added.
Changing the world
The next step? It may be a virtual economy they are dealing with, but these companies have already planned to leverage on their strengths to make a tangible impact in the community. For one, GTriip is looking at how to reduce the carbon footprint of its products and plans to partner local park authorities next year to plant more trees to limit global warming. Tiffin Labs’ Food Is Love Foundation distributed 10,000 restaurant-quality meals to healthcare workers and another 20,000 to the needy through the charity Free Food For All.
Last month, Oddle partnered White Restaurant, Keng Eng Kee Seafood, Swee Choon Tim Sum Restaurant and Penang Culture to
donate 10,000 packets of meals to vulnerable groups and needy families under the YMCA’s Wok the Talk Project. Oddle Eats is its latest initiative to bring people and industry partners who care about food closer together.
The online food directory riffs on Spotify’s and Netfllix’s playlist concept to help people organise their favourite restaurants and share them with friends and family. The experience is sweetened by the occasional promotions from corporate partners. “The aim is to help consumers easily discover the best dining experiences while bringing together those who want to help the F&B industry. It’s a win-win situation for all.”