No Signboard Holdings said it would adopt a cautious stance by not launching new dining brands after shuttering its three Hawker QSR outlets after less than a year.
“The group was faced with the decision to either continue investing into the business with the hope of turning it around or abort the investment to stem the losses. The group opted to be conservative and decided to cease the operations,” No Signboard said in a filing to SGX responding to queries from the exchange about the decision to exit the business.
After research and market testing, it had been confident of the potential for Hawker QSR, which was a fast-food take on traditional Singapore food, but the sales weren’t sustainable, No Signboard said.
No Signboard said it’s now looking to leverage off of two existing international brands, rather than launch new concepts, and it has obtained master franchises for Little Sheep and Mom’s Touch.
In addition, as part of its overseas growth strategies, it will open its first No Signboard Seafood overseas outlet in Shanghai by end-December, the iconic chili crab restaurateur said.
Little Sheep Hotpot has one outlet in Singapore, with a second to open at Orchard Gateway by year-end, the filing said.
“While the first Little Sheep Hotpot is yet to be profitable, it is operating close to breakeven and the group believes that with the establishment of the second location, we expect more economies of scale and synergies,” the filing said. “The group has not opened any
Mom’s Touch outlet at this time, however the first outlet is scheduled to be opened in September 2019.”
No Signboard said the financial impact from shuttering the Hawker QSR outlets will be from honoring the rental payments for the three outlets until replacement tenants can be found. The lease terms ranged from two to three years, it said.
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