What a $4.90 Sichuan Tofu tells us about the future of restaurants.

I've just returned from trips to Singapore and Hong Kong, connecting with building owners, designers, and restaurant operators, and attending Food & Hospitality Asia in Singapore, one of the world's leading food and hospitality trade events, where I also joined a panel discussion on the future of restauranting.

Both cities are fascinating case studies. And together, they tell a story I think every operator, landlord, and anyone involved in precinct strategy needs to hear.

𝗧𝗵𝗲 𝗰𝗵𝗮𝗹𝗹𝗲𝗻𝗴𝗲𝘀 𝗮𝗿𝗲 𝗳𝗮𝗺𝗶𝗹𝗶𝗮𝗿. 𝗧𝗵𝗲 𝗽𝗿𝗲𝘀𝘀𝘂𝗿𝗲𝘀 𝗮𝗿𝗲 𝗻𝗼𝘁.

Both Singapore and Hong Kong are grappling with the same headwinds affecting virtually every F&B market right now: tighter consumer spending, rising ingredient costs (particularly acute in import-heavy markets), climbing labour costs, and punishing rents. In Singapore alone, over 3,000 F&B outlets closed in 2024, the highest number in two decades.

But on top of all of this, each city faces an additional and entirely unique competitive pressure on menu pricing, and the contrast between the two is striking.

𝗦𝗶𝗻𝗴𝗮𝗽𝗼𝗿𝗲: 𝗧𝗵𝗲 𝗵𝗮𝘄𝗸𝗲𝗿 𝗳𝗹𝗼𝗼𝗿.

Singapore has a staggering density of eateries, around 6,400 registered restaurants for 6.1 million people, alongside thousands of hawker stalls and food courts offering exceptional food at remarkably low prices. That $4.90 Sichuan tofu dish I mentioned? It was extraordinary. And it was sitting in the same shopping centre as a $7.99 cup of Jasmine tea!

This abundance of cheap, high-quality food sets a near-unbeatable price floor for casual and mid-market operators. High-end restaurants with strong offerings are largely holding their own, but the middle is getting squeezed. Their costs are rising while their ability to lift prices is severely constrained by hawker competition that has decades of craft and a fraction of the overheads.

𝗛𝗼𝗻𝗴 𝗞𝗼𝗻𝗴: 𝗧𝗵𝗲 𝗦𝗵𝗲𝗻𝘇𝗵𝗲𝗻 𝗲𝗳𝗳𝗲𝗰𝘁.

Hong Kong faces a different but equally powerful force. Consumers are crossing the border to Shenzhen in significant numbers, where food and virtually everything else are a fraction of the price. The gap they're leaving in parts of the Hong Kong market is real and growing, putting enormous pressure on operators who are already navigating one of the world's most expensive cities in which to run a restaurant.

𝗧𝘄𝗼 𝗰𝗶𝘁𝗶𝗲𝘀. 𝗧𝘄𝗼 𝘃𝗲𝗿𝘆 𝗱𝗶𝗳𝗳𝗲𝗿𝗲𝗻𝘁 𝗰𝗼𝗺𝗽𝗲𝘁𝗶𝘁𝗶𝘃𝗲 𝘁𝗵𝗿𝗲𝗮𝘁𝘀. 𝗢𝗻𝗲 𝘂𝗻𝗶𝘃𝗲𝗿𝘀𝗮𝗹 𝗹𝗲𝘀𝘀𝗼𝗻.

Competing on price is a race to the bottom, and in both of these markets, it's a race you simply cannot win. The operators and precincts navigating these pressures most successfully aren't trying to undercut. They're investing in genuine differentiation: outstanding customer experiences, destinational concepts, and a value proposition that gives people a compelling reason to choose them and to keep coming back.

This requires landlords and operators to work together more closely than ever, understanding their target markets deeply, curating the right tenant mix, and building precincts that stand for something beyond convenience.

The lesson from Singapore and Hong Kong isn't really about those cities. It's a signal for every market.

Stop competing on price. Start building something worth paying for.