facebookHawkers Are Earning $0.50 for a $3 to $4 Dish: Can Food Delivery Platforms Really Help Them?

Advertisement

Hawkers Are Earning $0.50 for a $3 to $4 Dish: Can Food Delivery Platforms Really Help Them?

profileXue Miao

Ever since the pandemic started, most of us have been spending the bulk of our time at home.

Our phones have made it so convenient for us to get our meals settled without stepping out of our rooms.

Since the pandemic, a lot more merchants have started offering online deliveries as well.

With thousands of options available for us online just for us to scroll through, online food deliveries have become even more convenient for us.

However, are food delivery platforms really helping our hawkers?

Source: Damian Lugowski | Shutterstock

While there are initiatives to provide support for hawkers to go digital, many are still hesitant to be on board due to already thin profit margins.

We also have people who have been overlooked and are struggling to get by – our quiet elderly hawkers who are unfamiliar with social media and technological advancements.

Struggling to Survive

It is very difficult for a hawker to survive today.

Besides it being physically strenuous, hawkers have to face stiff competition and high overheads.

In today’s social media savvy world, people tend to flock to food centres that either bigger, more well-known, or stalls that provide more Instagram-worthy food.

Source: Timeout

As such, many of these elderly hawkers remain unseen, despite providing affordable and delicious food with a rich history.

These harsh working conditions are also making it difficult to find young successors who are willing to take over the stalls.

It is very scary to think that this pandemic might indicate the end of some of these stalls, taking a piece of Singapore’s heritage along with them.

Hawkers Can’t Afford High Commission Fees

One would imagine that elderly hawkers are hesitant to be on delivery platforms due to the complexity of platform systems.

However, as mentioned by Mr Seetoh, founder of Makansutra, the bigger problem lies with hawkers being unable to afford going digital, rather than being unwilling to digitalise.

According to him, hawker profits are around 12 to 15%.

This is due to expenses such as rent, salaries, cost of ingredients, packaging, and utilities.

With delivery platforms charging an average of 30% in commission fees, hawkers simply can’t pay for maintenance, admin, and commission fees.

According to Mr Melvin Chew, founder of Facebook group Hawkers United – Dabao 2020, after paying all costs, hawkers could earn as little as $0.50 for a $3 to $4 dish.

It is also relatively difficult to increase the prices of hawker food to increase revenue, as hawker food is known for its affordability and doing so might risk losing its competitive edge.

For hawkers who have embarked on food delivery programmes, these delivery platforms used to be a supplementary stream for many of these hawkers in the past.

Therefore, despite its high commission fees, hawkers were able to get by as it was not a core pillar in terms of revenue.

However, things are now different with a decrease in footfall due to the pandemic, and hawkers are now more reliant on these platforms to get customers.

With this increase in dependency, many hawkers have remarked that the fees are unsustainable for their businesses to survive.

How Are Food Delivery Platforms Supporting Hawkers?

The Government has been offering incentives for hawkers to adopt food delivery services.

For instance, more than 1,300 hawkers have taken up the National Environment Agency’s one-time grant of $500 to do so.

A recent Facebook post also showcased the various food delivery platforms that are offering discounts to encourage sign-ups.

Companies are offering one-off incentives such as discounted sign-up fees or lowered commission fees for a limited period of time.

MerchantBungkusDeliverooFoodpandaGrabfoodWhyQ
Sign-up FeesNo sign-up fees
Discounted sign-up fee at $150No sign-up fees (U.P. $100 before GST)30% off sign up fees
- $210 with device (U.P. $300)
- $70 without device (U.P. $100)
(After GST)
No sign-up fees
Commission Fees25% (No GST)30% commission fee (Before GST)~30% (Before GST)22% commission fee (U.P. 30%) (Before GST)No commission fees
Benefits for Merchants- Specialises in handling Halal food
- Sign-up support with photo session
- WhatsApp text/voice support for food ordering
- Cater to a wide base of customers with islandwide delivery
- Build up your brand prior to Ramadan (pre-orders)
- Customer support provided
- Always on-time deliveries with huge network of riders
- Track every order and check status from order from kitchen to doorstep on Deliveroo tablet
- App available in English and Chinese
- Marketing support (tagged in 'Hawker Heroes' carousel title)
- Post-activation service support
- Large fleet of reliable riders and a wide base of customers islandwide
- Insights on sales metrics, marketing guides and more via Panda University
- App & training materials available in English and Chinese
- 'Mix and Match' orders from different stalls in the same hawker centre within the same order*
* Only at selected hawker centres under Grab Hawker Centre 2.0 initiative
- Grabfood marketing support
- Large fleet of on-demand delivery riders and a wide customer base
- App available in English and Chinese
- 'Mix and Match' orders from different stalls in the same hawker centre within the same order
- No app nor device required
- On-site support via WhyQ Captains
- Dedicated WhatApp support line for general enquires, menu changes, operating hour changes and more
- Pause or terminate service anytime
PaymentsWeekly bank transfers
(every Wednesday)
Weekly bank transfer (every Friday)Three business days via GIRO/direct bank transfersWithin 48 hours via bank transferInstant payments via PayLah! or cash

While these measures are able to alleviate some woes of these hawkers, many are still finding these rates unsustainable for the long term.

For instance, the Restaurant Association of Singapore (RAS) hopes that the Government would step in and mandate these commission fees.

This includes lowering commission fees and reviewing commission models.

How Can We Support The Hawkers?

With the resumption of dine-in services, hawker centres are thankfully slowly seeing an increase in traffic again.

However, with this new normal, it would take quite some time before crowds would return to levels like before.

To reduce the reliance on the major food delivery apps, newer platforms have sprung up to provide alternative delivery options for these hawkers.

For instance, Facebook groups like Delivery United are set up to eliminate any middlemen costs.

Nevertheless, as most hawkers are still working for themselves and by themselves, they would prefer us to visit the stores instead of relying on online platforms due to logistical concerns.

For such cases, some newly-created platforms would help increase the visibility of hawker stores that might be neglected in the past.

For instance, we can drop by hawker stalls near us while we look to grab our lunches while working from home:

We also have Instagram pages like @wheretodapao that aims to help elderly hawkers get more business during this period.


Source: Roots SG

Having travelled to a few developed countries, I have an increased appreciation of the affordability of Singapore food.

It’s almost ridiculous how cheap and good our hawker food is.

And that’s also the beauty of the hawker food we have here, an intangible heritage that many would travel to our country just to experience it.

COVID-19 has shifted the ways we dine, and our hawkers have been faced with these new challenges.

Let’s hope that new measures and systems can be put in place to help them tide through this difficult period.

Advertisement

profile
About Xue Miao
A millennial who is learning to adult. She doesn't believe in the rat race and hopes to live on a farm someday.
You can contribute your thoughts like Xue Miao here.

Still have more questions after reading the article? Fret not, ask our community here!

Stay updated with the latest finance tips!
Receive bite-sized finance on Telegram here.

What's Popular

    • Loading articles
    • Loading articles
    • Loading articles
    • Loading articles
    • Loading articles

What's Popular

    • Loading articles
    • Loading articles
    • Loading articles
    • Loading articles
    • Loading articles

Still have more questions after reading the article? Fret not, ask our community here!

Claim our exclusive report on China stocks!

reward

Investing in China Tech Stocks: What You Should Know

Valid till Aug 31