Becoming Hawkers: Hawker Stall Rental Price, NEA Tender, Hawker Grants & Schemes Etc.

Lately, you might have come across news such as this:

And…this is not the only one.

I came across multiples just in the month of May.

This includes how a trio in their thirties became hawkers selling Bak Chor Mee (minced meat noodles) in Japanese Maze Soba-Style, and how ex-Singapore Airlines Steward sells pork belly rice and deep-fried lor bak (fried braised meat).

What was really intriguing was how these millennials who are in their late 20s and early 30s, quit their jobs to join the Food & Beverages (F&B) industry.

Some of us would probably have some franchise dreams. I used to joke about starting a restaurant or cafe business with my friends and each of us specialise in cuisine.

Of course, this was before I realised how costly it can be to start a cafe business.

Then, I got really curious about the cost of starting a hawker business when compared to a restaurant/cafe business.

Here’s how much it costs to become a hawker in Singapore!

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TL;DR: How Much Does It Cost To Be A Hawker & How Do I Become A Hawker?

Click here to jump:

• How Do I Become A Hawker?
• How To Bid For A Stall Under NEA’s Hawker Tender?
• What Happens After You’ve Successfully Bidded For A Stall?
• Cost of Basic Food Hygiene Course (For Cooked Food Stalls)
• Cost of Setting Up A Stall
• What Recurring Costs Should I Be Prepared For?
• Hawker Grants and Schemes

Note: All costs mentioned did not include the Goods and Services Tax (GST) as it will increase from 7% to 8% in January 2023, and to 9% in January 2024. 

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How Do I Become A Hawker?

Before we go any further, here’re a couple of basic requirements that you’ll have to meet if you plan to be a hawker.

You MUST be:

• A Singapore Citizen or Permanent Resident
• 21 years old and above

And you MUST NOT be:

• A former assistant or nominee who was de-registered by NEA
• Already renting or a joint operator of 2 cooked stalls managed by NEA
• An undischarged bankrupt
• Banned by the Government/Statutory Boards from taking part in all business tenders
• Banned from holding a hawker license by NEA (erm… duh?)

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How To Bid For A Stall Under NEA’s Hawker Tender

 

In order to rent a stall, you must tender for one under the National Environment Agency (NEA)’s monthly tender scheme.

Buy a Tender Form and Submission Envelopes A and B for $10 at NEA’s One-Stop Information and Service Centre (OSISC), which is located at HDB Hub East Wing.

You will also need to buy a Cashier’s Order from any bank, and make it payble to NEA. The amount will be equivalent to your bid amount.

According to NEA, the average successful bid is $1,514 per month.

Remember to buy a postage stamp too. 

NEA’s tender exercise is usually held from the 13th to 26th of each month.

If the 13th or 26th falls on a weekend or public holiday, the tender will be opened and closed the following business day.

You can also check out this step by step guide provided by NEA on how to fill in the application.

Total cost for bidding: ~$1,525

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What Happens After You’ve Successfully Bidded For A Stall

If your bid is unsuccessful, NEA will return your cashier’s order three to four weeks after the closing of the tender.

Once you have successfully bid for a stall, you will receive a Letter of Offer from NEA three to four weeks after the tender’s closing date.

This allows you to rent the stall for three years.

You will be informed of your scheduled appointment date to sign the Tenancy Agreement.

Say you are operating a cooked food stall, you will need to complete the Basic Food Hygiene Course (BFHC) and apply for a Hawker Licence before you can run your stall.

After signing the Tenancy Agreement, new tenants are given up to three months to commence operations.

Note that you will need to pay these during the signing of the agreement:

• First month’s stall rental
• First month’s Service & Conservancy Charges (S&CC)
• Table-cleaning fees (for cooked food stall)
• Deposit of two months’ rent
• Hawker Licence (valid for three years)
• Stamp Duty

Based on the latest Tender Notice by NEA, a guesstimate of the deposits will cost:

• Stall rental for the first month: $1,514
• S&CC for the first month: ~$210
• Table-cleaning fees (for cooked food stall): ~$600
• Deposit of two months’ rent: $3,028
• Hawker Licence (valid for three years): $39
• Stamp Duty: No estimates available

The total costs (excluding Stamp Duty and prevailing GST): $5,391

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You Will Need To Attend The Basic Food Hygiene Course (BFHC)

You’ll also need to undergo a six-hour Basic Food Hygiene Course, followed by a 1.5-hour assessment.

Oh, the assistant whom you hire to handle food will also need to go through the course.

Cost of attending the BFHC for you and one assistant (before SkillsFuture funding): $321

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Cost of Setting Up Your Hawker Stall

For reference, I found the above stainless steel chicken rice stall on Carousell for $1,800.

This will probably form the bulk of your sunk cost if you’re really serious about being a hawker.

You’ll need stuff like:

• Metalwork (eg. kitchen counters, hoods, food prep surfaces etc.)
• Kitchen equipment (eg. stoves, ovens,  etc.)
• Utensils (eg. cutlery, plates, bowls, cups, glasses etc.)

A really, really conservative estimate for set up and preparation: $8,000

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What Recurring Costs Should I Be Prepared For?

Based on NEA’s Cost Component Survey in 2012 and 2013 (the last NEA updated in 2018 mentioned that there was no change to the survey findings), the cost component of operating a hawker stall is as follows.

1. Monthly Hawker Stall Rental

Your monthly rental for your hawker stall is subjected to the bid, and it will not change during your tenancy. 

According to NEA, the average bid for a hawker stall seemed to be $1,514…but this was in 2018.  

NEA has also clarified in one of its Facebook posts in 2021 that the rental costs of hawker stalls have not increased by more than $300 in recent years. 

But obviously, a hawker stall in a popular place like Amoy Street Food Centre is going to cost more.

Some of our community members have also shared that it could be around $3,000 to $4,000 now due to rising costs. 

Indeed, just looking at April 2022’s bids alone, the highest bid at Golden Mile Food Centre was $3,939 whereas the lowest bid was $8.88 at Blk 36 Telok Blangah Rise (I’ll admit, I don’t know this place at all).

As the cost of rental varies based on location and footfall, we’ve given a range of costs for your budgeting. 

Estimated monthly recurring rent: $1,514 to $4,000 

2. SCC, Table Cleaning Etc.

 

Apart from monthly rental, you’ll also have to pay:

• Service & conservancy fees: ~$210
• Table cleaning fees: ~$600
• Refuse disposal fees etc.

A conservative monthly expectation: $1,200

3. Hiring An Assistant

While 545 Whampoa Prawn Noodles is offering $2,500 a month as a starting salary for a cook. That kind of remuneration is not really the industry standard.

However, assistants don’t come cheap either.

They’re going to have to:

• Brave the heat of the kitchen
• Man the stall with you in the wee hours of the morning till night (if you wish to maximise your profits)
• Prep the food and maybe even cook some
• Wash and clean up the stall

So they’ll be expecting something like $1,800 to $2,400 a month.

To ensure that we don’t fall under budget, we will use $2,400 for the calculation instead.

4. Utilities

This means that taking in all costs, utilities at 9.3% of the overall cost would be $1,173 if we are using rent as a basis for calculation.

Raw materials

According to a CNA interview, a prawn noodle hawker typically spends about $2,400 or more every month – this is if he sells about 20kg of prawns daily and works six days a week, just on prawns online.

Let’s say we decide to sell prawn noodles as well. We’ll need to factor in other ingredients like:

• Fishcake
• Meat
• Noodles
• Oil
• Onions

And we ignore the fact that you might mess up and drop stuff, or food might spoil in this ridiculous Singapore heat.

Based on this chart, we can see that raw materials cost slightly above $5,000.

To make the calculation easier, we’ve bumped up raw materials to $6,000 since the chart was from 10 years ago.

Still, this might not be sufficient as the prices of food have increased due to inflation and food shortages.

If you’re not aware, from 1 Jun 2022, Malaysia will be halting its chicken export due to internal shortages within the country itself.

Some wet market sellers have also been forced to close their business temporarily as a result.

This means that there is a high chance that your cost for raw materials will increase if you want to sell chicken rice, fried chicken etc.

You should also note that all costs listed above did not include GST.

Factor this in as part of the budget for setting up and operating a hawker stall.

Total monthly recurring cost: $12,287

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You Can Apply For Hawker Grants And Schemes

Yes, there are grants and schemes available should you want to start your own hawker stall.

1. Incubation Stall Programme

A first-timer starting a business of your own can be risky and the Incubation Stall Programme is designed to help you get a headstart.

Successful applicants will be offered their stalls at:

• 50% of the market rent for nine months, followed by 75% of the market rent for another six months
• Pre-fitted with basic equipment to lower the upfront capital investment needed for the setting up of a stall
• Over the first fifteen months, aspiring hawkers will have the opportunity to learn the ropes of being a hawker and establish their businesses.

2. Hawker Productivity Grant

The Hawkers’ Productivity Grant provides stallholders funding support for the purchase of kitchen automation equipment which can help them become more productive.

Eligible stallholders can claim 80% of the equipment unit cost (excluding GST) on a reimbursement basis.

This is capped at $5,000 over three years.

Equipment that has been funded by other grant schemes will not be supported.

Remember to also check the list of automation equipment that qualifies for the grant.

3. Inclusive Growth Programme

The IGP fund is managed by the Employment & Employability Institute (e2i), which funds up to 50% of productivity improvement costs.

It also allows up to 90% of co-funding for training directly relevant to productivity improvements.

All these are subject to a cap of up to $300,000 per project.

Such projects include:

• Automation & equipment costs
• Process re-engineering and training costs and Job redesign

4. Productivity Solutions Grant (PSG)

Enterprise Singapore (ESG) provides funding support to companies on their adoption of productivity solutions such as IT solutions, equipment and consultancy services.

These productivity solutions have been pre-scoped by various government agencies such as ESG, NEA and Singapore Tourism Board (STB).

Successful applicants will receive up to $30,000 per financial year.

For eligible pre-scoped solutions in the Food Services and Retail sectors, ESG can provide an enhanced support level of up to 80%.

5. Hawkers’ Development Programme

The Hawkers’ Development Programme (HDP) aims to equip aspiring and existing hawkers with the relevant skills and competencies to run their businesses.

It also encourages them to leverage social media for marketing.

Participants will go through three stages:

• Training – learn the basics of food safety and hygiene, basic cooking techniques and business, as well as marketing techniques on social media and food delivery apps
• Apprenticeship – after this stage, they can apply for the ISP or bid for a stall
• Incubation – test business plans and cooking

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Starting A Business Requires More Than Just Money

There are challenges that make people hesitate – long hours, hard work, business risks. So just passion alone, although it is a very good starting point, is not enough.

– Minister for Education Ong Ye Kung

Just as Minister Ong shared, apart from monetary costs, you will also need to consider the long hours required to be a hawker. 

Starting an F&B business on your own is risky, and building the business requires lots of patience and mental resilience. 

Would you start a hawker business? 

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