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Coming out of Jumbo's shell
FOR seafood fiends, there is nothing more glorious than getting your hands messy and tucking into a plate of piping-hot chilli crab.
This renowned Singaporean dish is what Jumbo Seafood is most well-known for, and its five outlets here are often packed with both local and tourists wanting a taste.
Its fame has paved the way for Jumbo Seafood's ambitious expansion into China and its recent initial public offering (IPO) debut on the Catalist board that was almost eight times subscribed.
It has certainly been a busy period for chief executive officer Ang Kiam Meng, but he says that it is necessary for the company to continue participating in awards such as Enterprise 50 as it is a "report book on how well we have done".
"We can't just go ahead blindly without a benchmark in the industry as we would not know whether we are on the right path or not. It is a recognition of our effort," he says of the company's listing.
Jumbo Seafood's IPO was the talk of the town earlier this month as the listing market has been relatively dismal so far this year.
According to Mr Ang, the purpose of the IPO was to expose the company to a wider platform, tap the capital market and raise its profile in the hope of attracting better talent.
"It is also for staff to have a share of our company and distribute the fruits of our success," he adds.
The company's listing is considered one of the biggest this year, and raised S$40 million from investors including Heliconia Capital Management (a Temasek Holdings unit) and OSIM International chairman Ron Sim.
"With the IPO, it is hoped that more people will get to know us. The company will be more transparent and people will know we have good corporate governance (due to listing requirements). We also hope to get more strategic business partners," says Mr Ang.
One of the ways Jumbo Seafood is planning to use its IPO proceeds is to expand further in China.
Mr Ang believes that China is a very promising market with a large segment of cosmopolitan middle-class consumers who have high spending power and are "adventurous in food and taste".
MANAGING HUMAN CAPITAL
Jumbo Seafood entered the China market in November 2013, and has been focusing on Shanghai as a springboard into the country. The plan is to build a strong local middle-management team there, as well as create awareness of the brand before expanding into other cities.
"By then, if we have opportunities in other places like South Korea or Hong Kong - or even the US and Europe - we will move in," he says.
Mr Ang says he is not particularly worried about China's slowing growth as Jumbo Seafood is targeting the mass market, and not the fine-dining segment.
"Our experience in Shanghai shows that their spending per head is more than in Singapore - about S$70 compared to S$50-S$60 here. With labour costs and rental costs relatively lower, that gives us the extra margin for our business there. There is very good market potential," notes Mr Ang.
Even with all the fanfare over its China expansion and IPO listing, Jumbo Seafood still puts managing its human capital at the top of its priorities. "We are mindful of human capital, and we put in a lot of effort to recruit, train, groom and retain people - that's how we stand out from the rest," says Mr Ang.
He adds that doing business in Singapore requires an understanding of labour policies and the company has to be careful to strike a balance between local workers and foreign ones.
The first step of the process is recruitment. Aside from advertising, Jumbo Seafood has various initiatives to attract talent such as scholarships, taking in mid-career workers and staff referrals.
Mr Ang stresses that staff need to feel they are a part of the company and have a purpose in their careers. "This is especially true for young people. After training them, we need to think of ways to retain them, to make them stay with us. So in addition to a good pay package, we also take care of their welfare," says Mr Ang.
Jumbo Seafood provides staff with three meals a day, and they also get the opportunity to go on a free day tour around Singapore on their day off to relax and mingle with colleagues from the other outlets.
The company has taken welfare one step further by providing comfortable, low-cost accommodation for its foreign workers.
"Rental is very expensive in Singapore and many times, living conditions are bad with up to eight people squeezed into a room," says Mr Ang.
In view of that, Jumbo Seafood rents fully furnished apartments equipped with wireless Internet and air-conditioning, and with a maximum of four people to a room. The company pays for utilities and even provides domestic helpers to clean the apartments.
"We hope to achieve an environment just like home. We believe that if our employees rest well, they will perform well," he explains.
Mr Ang emphasises that the food and beverage industry is very dependent on people. "Every step of the process - from the buying of raw products to sending the customers off - requires people. We can only automate to a certain extent so that is why we need good people. Processes and SOPs (standard operating procedures) can minimise problems, but we still need the human touch to ensure quality delivery," says Mr Ang.
One thing that Mr Ang has learnt about the F&B business is that food is the most critical factor. "People can bear with rude hawkers as long as the food is good. People are willing to queue, get scolded, and will still come back for more," he jokes.
One of Jumbo Seafood's biggest milestones was to open a central kitchen in 2008 when the company realised the need to deliver food consistency across its outlets.
"Before we had our central kitchen, the sauces were made individually by the chefs in each outlet. Some chefs like being more creative, but we realised we needed consistency. Also, with a central kitchen, our chefs don't need to do as much preparation work, so it is less tiring for them. They are able to work longer hours, and consistently produce the same dish," he says.
The central kitchen also helped save precious space in the company's outlets as there was no need for such big kitchens any more. This translated to more seating space, and more revenue generated per square foot.
Moving forward, expansion plans in the Republic will take place at a slower pace as Singapore is a mature market for Jumbo Seafood's business. Setting up a base in Shanghai and the focus on growth in China will take precedence for the time being
Jumbo is the only seafood-focused restaurant group on the Singapore Exchange, and Mr Ang says he hopes to spearhead a movement and inspire others to do the same. "The F&B industry here is so vibrant as Singapore is a food capital. I hope more companies will do well and take the path to an IPO to grow Singapore's food culture to the region," he concludes.