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From a Waist Wallet to a Sound Financial Management System

Discover how local restaurant Mak’s Place cut costs, improved profitability and reduced wastage by focusing on a core business operation.


From a Waist Wallet to a Sound Financial Management System

By focusing on a core business operation, local restaurant Mak’s Place has cut costs, improved profitability and reduced wastage.

While Singapore enjoys a vibrant food & beverage (F&B) scene, smaller businesses in this space sometimes struggle. In fact, based on a 2015 SPRING Singapore (now Enterprise Singapore1) survey, only some 60 percent of smaller F&B businesses survive their first five years of operation. The study revealed that successful smaller F&B businesses tend to have a stronger focus on core business operations than on ancillary areas such as branding.

Breaking Boxes from the Start

From the outset, restaurateur and passionate foodie Mr Feroz Mak did things differently, focusing on an often ignored area of small businesses: financial management. Indeed, it was not the first time that he had approached business from an out-of-the-box perspective.

The owner of Mak’s Place, a restaurant that serves halal Chinese food, says that he was first inspired by his mother’s home cooking, and later, from his observation that outside of the home, good Chinese-Muslim food was hard to come by. “Those days, you could count on one hand the restaurants that had halal certification, let alone those that served Muslims. I wanted to provide halal Chinese food that tasted like it came from the heart, to this community.”

Staying ahead of the curve did not stop with the birth of his restaurant in 1998. A turning point came about 2010, when instead of retiring as he’d originally planned, he decided to scale up his business. He explains this change of heart as follows,  “I decided to carry-on with my business mainly because of all my long-standing customers’ requests to continue.”

Yet he realised this could not be achieved solely as an informally-run business, especially given that the company’s finances at the time were managed by him single-handedly, while also having the hat of chief chef and human resource manager. “I ran my business from this waist wallet,” he says laughing, pointing at his hip. “I paid my staff and suppliers out of it. And while I was meticulous with my filing and invoicing, we used to run into trouble whenever I was out of town,” he recalls.

“I realised that this system of running my finances just would not do,” he says. “My timing could not have been more perfect, because at the same time that I decided to scale up my financial processes, SPRING (now Enterprise Singapore1)  became more active in reaching out to small and medium-sized enterprises (SMEs) like myself with their assistance programmes.

From a Waist Wallet to a Sound Financial Management System

Connecting with Partners To Improve Business Processes

After approaching the SME Centre at the Singapore Malay Chamber of Commerce and Industry (SMCCI), Mr Mak realised that he had to shift away from his manual, paper-based bookkeeping, to a more efficient financial management system.

He then embarked on his journey of upgrading his restaurant’s financial management capabilities, purchasing a point-of-sale software that helped the business to record sales, monitor inventory, generate reports and purchase orders — and even evaluate suppliers’ prices. In addition, he hired an in-house certified public accountant to tighten his company’s financial management process. During this time, he also discovered that he was eligible to tap on SPRING Singapore’s (now Enterprise Singapore1) Capability Development Grant (CDG) and did so to strengthen his company’s financial management capabilities. 

What advice would he share with others like him? Based on his experience, Mr Mak notes, “Entrenching good financial management and expertise is a crucial base that all SMEs should do, whatever the company size. Without it there is no good overview, a lot of time and labour tends to be used and wasted — and as a result, a business cannot grow to the next level.”

He stresses that companies like his have to move away from a micro-business mind-set. “If you think small, you will stay small or disappear. Yes, you have to set aside cash to upgrade your processes: and for small companies, this can be a big deal. But if it’s not done, you don’t grow,” he says.

Scaling up is about giving your business its best opportunity to succeed, he notes. “I believe that if you have a great product or service, then don’t waste it. Work out the cost component that will move you forward,” he suggests. “Everything that a company invests in should be tied to productivity but not many restaurants think this way. Many — especially the younger ones — tend to focus on branding, forgetting the engine,” he observes.

Working with business advisors from the SMCCI, SME Centre and IE Singapore (now Enterprise Singapore1) has helped make the road clearer for him and he says that companies should not hesitate to ask for help, advice or even direction. “Think things out, prepare yourself well and plan the next steps. Just like marriages, ventures fail if you are doing it for the wrong reasons,” he advises. “It’s important to get the right advice and expertise so don’t be shy here.”

Click here to find out more about how the SME Centres can help you.

 

1SPRING Singapore merged with IE Singapore to form Enterprise Singapore on 1 April 2018.

Last Modified Date: 04 Oct 2018