Foodservice continues to trip over rising costs and supply chain obstacles

Complicated menu items or low-selling items should be removed.

Rising input costs and ongoing supply chain continue to challenge Singapore’s foodservice market despite growing to $37.11b in 2025, with growth forecasted to reach $102.31b at a compound annual growth rate of 18.42%, a report by Research and Markets revealed.

In the first month of 2025, more than 2,400 food and beverage outlets closed their doors, following a near 20-year high in closures in 2024.

Removing low-selling products or complicated menu items could help foodservice improve its bottom line. Anuran Dhar, practice head for foodservice at GlobalData Plc, told Singapore Business Review that a tighter menu improves speed, reduces wastage and makes training easier.

Meanwhile, Singapore’s foodservice market continues to grow, driven by factors such as the recovery of the tourism industry, a tech-savvy population, and strong government initiatives promoting digital payment systems. Businesses that adopt innovations like contactless ordering, loyalty programs, and creative menu offerings are likely to increase their average revenue per customer while reducing labor costs.

Dine-in remains the leading segment in Singapore’s foodservice market, holding 65.12% of the total market share in 2025. This dominance highlights consumers’ preference for dining experiences that offer a combination of good food, ambiance, and social interaction elements that digital platforms cannot fully replicate.

Restaurants, cafes, and casual dining outlets, particularly in popular areas like Orchard Road and Marina Bay, continue to attract customers. To enhance the dine-in experience, operators are introducing features such as themed interiors, live cooking stations, and chef-curated menus, which help create memorable experiences and encourage repeat visits.

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