Both sectors did statistically better compared to the same period in 2015. The Tourism sector scored 71.1 points (+1.7 points/ +2.4% year-on-year), and the F&B sector scored 70.1 points (+2.98 points/+4.4% year-on-year) on a 0 to 100 scale.
Within the Tourism sector, the Hotels and Attractions sub-sectors outperformed the sector average at 72.5 points and 72.8 points respectively. Sentosa was the top performer in the Attractions sub-sector, scoring 74.3 points, and improvement of +2.76 points (+3.9% year-on-year).
Top ranking entities in Hotels include Marina Bay Sands (77.2 points), Shangri-La (75.6 points) and The Ritz-Carlton (74.9 points).
In addition to intuitive hygiene factors such as hotel facilities, in-room amenities and Internet connectivity, efficiency of the check-in and check-out process as well as the ability to accommodate to special requests were key attributes impacting perceived quality and loyalty for Hotels. As for Attractions, ease of getting around, food and beverage options and cleanliness of attraction came up as key drivers of perceived quality and loyalty.
The F&B sector is made up of five sub-sectors including Bars & Pubs, Fast Food Restaurants, Cafes & Snack Bars, Restaurants and Food Courts. Out of these, Bars & Pubs (72.7 points) performed significantly above the Food & Beverage sector average. While Cafes & Snack Bars (70.7 points/+2.64 points or +3.9%) and Food Courts (69.2 points/+2.74 points or +4.1%) performed better than the year before, Fast Food Restaurants (70.7 points) remained statistically unchanged.
Ease of making reservations and waiting time to be seated emerged as important differentiators with impact on both perceived quality and loyalty for the Restaurants sub-sector.
Although the food beverage industry improved, executive director of ISES Neeta Lachmandas said there has been a dip in expected quality among people here before they go to the outlets, "particularly in food courts, bars and pubs, as well as cafes and snack bars, possibly signalling a mindset adjustment within the manpower-constrained environment that businesses are operating in".
"A continued decline in expected quality may have adverse effects on repurchase intentions in the future," she added.
“While food quality is intuitively important for the F&B sector, the data is telling us that service elements including the ability of service staff to explain menu items, the order-taking process and the ability to accommodate special requests are also important in driving satisfaction,” noted Mr Chen Yongchang, Head of Research and Consulting at ISES.
The study in the third quarter was conducted between July and October 2016. The latest results were based on a total of 8,563 surveys.
Overcoming the manpower-constrained environment in the F&B industry
Mr Andrew Ing, CEO, The Lo & Behold Group focuses on the people and the working culture of his establishments. “We look at our staff, and why they would want to join us in the first place, and why they would want to stay.”
Placing emphasis on his staff, Andrew thinks about how to remain an employer of choice by engaging his staff better. In order to attract the right talents, it’s important to ensure good career prospects and progression is available, coaching is provided and that the organisation genuinely cares for your well-being.
“I spend most of my time on human capital matters. That’s the key for us,” said Mr Ing.
Mr Loh Lik Peng, Hotelier and Restaurateur of The Unlisted Collection navigates the challenging environment by making sure that staff are in an attractive environment, and are motivated by things that interest them. Ensuring staff are constantly on a learning journey ensures they do not get bored. Autonomy and having the power to make decisions are other key attributes that staff should be given in order to ensure talent retention.
“We don’t pigeonhole our staff, we try and ask them what they want to do, how they fit into the organisation. If we give them enough choices, they feel fulfilled learning from an innovative environment,” said Mr Loh.
He also believes that engaging and rewarding staff needs to be looked at from a wide angle. It is important that the pay systems align with the employee’s performance. If the employee feels he has a stake in the restaurant, you will find they perform better and they stay longer.
Remaining competitive through innovation
Both the Lo & Behold Group and The Unlisted Collection remain competitive in the manpower-lean environment by staying ahead of the pack. Travelling the globe to keep up with trends and gain insights, and figuring out what their consumers want is necessary in order to succeed. Mr Loh believes it is vital to be agile enough to change when the time comes.
He also believes it is important to rely on staff who can think along with the leadership team, and have the right staff who can handle new concepts and change.
The Lo & Behold Group remains competitive by introducing new concepts which are usually location-driven. “Sometimes we fall in love with a building first, before we come up with the concept, which can be tricky,” said Mr Ing.
Remaining open-minded to ideas, especially on-the-ground insights from frontliners can be an effective tool to be successful in the F&B industry.
Remaining agile with service design
ISES Executive Director Ms Neeta Lachmandas acknowledged the link between staff retention and effective process design. “Staff will find it more meaningful if your establishment’s service design is done well,” said Ms Lachmandas.
The CSISG data has shown the importance of processes over the human element where service processes such as the ‘ease of making reservations’ and ‘waiting time to be seated’ are key differentiators to drive loyalty and quality.
Said Ms Neeta, “Through our data, we have found customers want a well-designed process. Our customers are changing, and as they change, processes need to change. As processes change, you will attract the right people who see value in these changes.”
The impact of technology and social media on marketing and business strategies
With the accessibility to social media today, every customer can be a food critic today, where they can share their experiences online immediately. As a result, getting the right service recovery processes in place is necessary in order to avoid situations which may turn ugly. Both Mr Loh and Mr Ing agree that empowering their frontline staff to make decisions on the spot such as offering an alternative dish or a free meal if it means rectifying an issue is essential.
“Transparency is key for me where I am copied into every email that is sent to our central account. As such I have full visibility of all complaints and compliments. It’s about sincerity of how you deal with each situation. If we fail to serve a customer well, we accept it, and move on, dealing with it before it becomes more of an issue. Sometimes it works in our favour when we and turn a customer around and they become our ambassador,” said Mr Ing.
Expectations of local customers
Although the food beverage industry improved, Ms Lachmandas said there has been a dip in expected quality among people here before they go to the outlets, "particularly in food courts, bars and pubs, as well as cafes and snack bars, possibly signalling a mindset adjustment within the manpower-constrained environment that businesses are operating in".
"A continued decline in expected quality may have adverse effects on repurchase intentions in the future," she added.
“With declining expectations, it poses a threat to the sustainability of businesses. We need to do something to deal with this.”
Ms Lachmandas stressed the importance of three key elements of innovation, service design and understanding your staff in order to remain successful and competitive in the industry. “If attention is paid to these, you will find the detractors, that despite trends like declining customer expectations, they still perform well because they are able to keep their staff, and satisfy their customers. The question is what we can learn from these industry players.”
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