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 the 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 fulfill 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 every person of the staff of the business 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, at times things can get difficult to manage. Everyone has its 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 to expect them to be more flexible with your desires.
The capital is yet another element that can take a family business to success. Because multiple members of the family are involved in the business, they can have together more capital than a regular business. This allows them to make a bigger investment from the start. Naturally, the profits will also distribute to all the members of the family, so before the business really takes off, they may not feel like their investment pays off.
Is there a solution to keep everybody happy, and to prevent the members of the family 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, as well as 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 that the big businesses are using. They 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.
Here, of course, we may include everything from the cooking devices in the kitchen, so maybe more important, a software that makes ordering, paying and keeping track of the paperwork an easy task. By relying on software to do all this, instead of using the old notebooks for taking the orders and invoicing the clients, it will be not only easier on the short term, but also on the long run.
With software such as FoodRazor, you can forget about mistakes. Almost every procedure in the restaurant back-of-house can be digitalized, from the moment the suppliers place the invoice to the financial inventory at the end of the week. Things like not knowing that the price has changed or forgetting that you need to order more vegetables will never happen again.
As you can easily imagine, this will not only be beneficial for the business part but also it will maintain good relationships between the members of the family. Things can get complicated quickly when there are mistakes because others point them out and some may get frustrated. There will never be tensions again because someone forgot about an order or an invoice; the software will take care of everything!
Also, using software eliminates almost completely overspending. By seeing at any time what are the expenses, where is the money going and how much it goes for different types of foods, you can easily adjust the spending and make sure that you are not paying money that won’t come back to you.
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 business, but back in 1987 when it started it was far from this. The 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 take it to the top.
However, things did not go as planned, and in 1989 Mr. Ang’s father took the role of the manager, as the professional did not live up to the task. In 1993, Mr. Ang decided to open a branch of the restaurant on his own, although he only had experience in an engineering company. Initially, the business struggled, and although they tried to expand their business overseas, they failed and they had to restructure the staff and invest in a food technology consultant and a central kitchen.
The result? Years later, Mr. Ang, his father, an uncle, his wife, and two sisters, as well as his eldest child, work together to ensure the prosperity of the business. 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 take decisions that would benefit the business, and to reject the ones that would not lead to a good outcome, like the initial expansion one. 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 on the F&B market is huge, and there are new, modern businesses open 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 should not be afraid that you will lose the foundation of your business by using new technologies. If anything, you will just strengthen family relationships. There will be no mistakes, no reasons for arguments, a business that is more advanced day by day, and a family to enjoy all this together.