Singapore’s food and beverage industry is going through one of its toughest periods as hundreds of restaurants shut down due to rising costs and changing dining habits. In 2025, the country continues to feel the impact of a challenging 2024, when over 3,000 restaurants closed, marking the highest number of closures in almost twenty years. The slowdown reflects how inflation and higher living expenses are changing consumer behaviour as people spend less on eating out.
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Rising Costs Push Restaurants to the Edge
Data from the Ministry of Trade and Industry (MTI) shows that 82 percent of the restaurants that closed never made a profit. Younger businesses are the most affected, with 63 percent of closures involving outlets that operated for five years or less. The combination of high rent, expensive ingredients, and labour shortages has made it difficult for restaurant owners to stay afloat. Even well-known chains such as Prive and Ka-Soh have shut their doors, showing that no brand is immune to the ongoing financial pressure.
Catering Businesses See Positive Growth
Despite the wave of closures, the catering sector is seeing strong growth. According to industry reports, catering services expanded by 17.8 percent in the second quarter of 2025. Many restaurant owners have successfully shifted their focus to event and banquet catering. For instance, Yum Cha has diversified its operations to meet growing demand for private and corporate functions, highlighting that adaptability can be the key to survival.
Overview of Singapore’s F&B Market 2025
| Sector | Market Trend | Main Challenges | Growth Potential |
|---|---|---|---|
| Restaurants | Declining | High rent, low profits | Low |
| Cafés | Stable | Competitive market | Moderate |
| Catering | Rising | Increased event demand | High |
| Food Delivery | Expanding | Dependence on online platforms | High |
Grab CEO Encourages Drivers to Learn New Skills
Grab CEO Anthony Tan has urged drivers and delivery partners to start upskilling to prepare for future opportunities in technology. Grab plans to launch autonomous robobuses in 2026, which will transform traditional driving jobs. Tan explained that new roles such as data labellers, LiDAR specialists, and remote safety operators will soon become essential as Grab invests more in autonomous vehicle technology.
Grab’s Strong Financial Growth
Grab’s focus on innovation has paid off financially. In the third quarter of 2025, the company reported a 22 percent rise in revenue to US$873 million and a net profit of US$17 million. Adjusted EBITDA also climbed 51 percent to US$136 million, prompting the company to raise its full-year profit forecast to nearly US$500 million. These figures show the success of Grab’s technology-driven approach across Southeast Asia.
Preparing Singapore’s Workforce for the Future
Anthony Tan highlighted that upskilling is critical for workers to remain competitive as automation increases. Grab’s new initiatives will create jobs in technology and safety operations, giving workers more stable and higher-value roles. This shift represents a broader trend in Singapore’s labour market, where lifelong learning and adaptability are becoming essential skills.
The Path Forward
Singapore’s restaurant closures reflect deeper challenges in the economy, from inflation to changing consumer patterns. However, industries that innovate and diversify such as catering and technology are showing resilience. As Grab and other companies embrace automation, workers and businesses alike must focus on developing new capabilities to thrive in the evolving market.
FAQ
1. Why are so many restaurants closing in Singapore?
Rising rent, higher ingredient costs, and lower customer spending have forced many restaurants to shut down.
2. Which parts of the F&B industry are still growing?
Catering and food delivery services are expanding as demand for convenience and event-based dining increases.
3. What did Grab CEO Anthony Tan advise drivers to do?
He urged drivers to upskill and prepare for future technology-focused jobs as Grab invests in autonomous transport.
4. How well is Grab performing financially?
Grab reported a 22 percent revenue growth in Q3 2025 with a profit of US$17 million and strong year-end projections.
5. When will Grab introduce its robobuses in Singapore?
The company plans to launch its autonomous robobuses in 2026 as part of its regional innovation strategy.
