1 of 9 NANYANG TECHNOLOGICAL Nanyang Business School UNIVERSITY SINGAPORE ASIACASE.COM THE ASIAN BUSINESS CASE CENTRE...

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1 of 9 NANYANG TECHNOLOGICAL Nanyang Business School UNIVERSITY SINGAPORE ASIACASE.COM THE ASIAN BUSINESS CASE CENTRE TIANBAO SZECHUAN KITCHEN: POSITIONING AN F&B BRAND On July 6, 2019, a Saturday evening, Jackson Zhang, co-owner of Tian Bao Szechuan Kitchen, stood at the dining hall of his 4-year-old restaurant located at Hillion Mall, a shopping mall located in Bukit Panjang. a residential district in the western part of Singapore. Satisfied with the crowd and how busy the restaurant was, he thought to himself, "As a small restaurant, my business is pretty good and I have the support of a core group of customers who are residents in Bukit Panjang. But how do I make the Tian Bao name a much more distinctive food and beverage (F&B) brand to the broader population of Singaporean diners?" He started reflecting on what made Tian Bao and its offerings special to customers who patronised the restaurant, and whether Tian Bao as a Szechuan cuisine restaurant stood out among the many competitors in the growing but increasingly crowded Szechuan food space. TIAN BAO SZECHUAN KITCHEN OVER THE YEARS Tian Bao Szechuan Kitchen was a restaurant that served authentic cuisine from Szechuan (or, more formally, Sichuan, which was a province in the southwestern region of China). Jackson Zhang, a 28-year old Chinese national living in Singapore, co-owned the restaurant with his wife, Violet Zhang, also a Chinese national. Jackson and Violet had both studied in Singapore since their teenage years and graduated from local public universities. They had known each other from school and shared a passion for food. When they each graduated from university in 2012 with a business degree, they did what most Singaporean graduates would do: worked for large multinational firms. Jackson spent three years with Citibank in a private wealth management role, whereas Violet worked as a financial analyst with an investment bank. Shortly after they got married in early 2015, they decided they would pursue their mutual dream of starting a restaurant business. It was not a difficult decision for them to choose Szechuan food as the cuisine to offer at their restaurant, as Szechuan was their shared hometown cuisine. Page 2 ABCC-2020-001 -ASIACASE.COM THE ASIAN BUSINESS CASE CENTRE With some startup capital contributed by their parents and supplemented by some personal savings, they opened Tian Bao Szechuan Kitchen at Ngee Ann City, a prime mall located on Orchard Road, a central shopping district in Singapore. The mall, connected to two large office towers and was tenanted by masstige and luxury stores such as Coach, Zara, Tiffany & Co., Mont Blanc, and Chanel, which generally served the mid-to-upper-mid-tier shopper crowd throughout the week, and the office crowd during weekdays. The restaurant was located on Level 5, a dining and lifestyle floor where a number of other mid-priced restaurants (including a Korean BBQ restaurant, a Japanese Sushi restaurant, and a Thai casual dining restaurant) could be found. Tian Bao occupied a floor area of around 200 square metres and was renovated in a rather upscale though not extravagant manner (see Exhibit 1). The dining furniture, made of premium wood, was specially imported from Szechuan. In March 2017, Tian Bao opened a second outlet at Hillion Mall in Bukit Panjang in the western part of Singapore (see Exhibit 2). In contrast to Ngee Ann City, Hillion Mall was a neighbourhood mall situated in a residential district. The mall was connected to the Hillion Residences condominium, a large 546-unit private residential development that had direct access to the Mass Rapid Transit (MRT) and Light Rail Transift (LRT) lines in the heart of the Bukit Panjang district. The mall was a family and lifestyle retail complex that included a supermarket, home and furnishings shops, beauty and wellness centres, F&B joints, and various other types of stores. Most of the stores were positioned to target mid-tier shopper crowds, and the shoppers mostly dressed casually since the area was a residential district. Business at the Hillion Mall outlet was brisk, and, coupled with the rising operating costs at Ngee Ann City, Tian Bao quickly moved itsentire operations to Hillion. THE TIAN BAO MENU Unlike many other Szechuan food eateries in Singapore that served ultra-spicy hotpot dishes, Tian Bao's menu offered more refined items, such as cold appetisers, Dim Sum, specialty side dishes, and Szechuan traditional desserts (see Exhibit 3). According to Jackson, "I would like Singaporean diners to experience and appreciate a wider spectrum of Szechuan cuisine without getting themselves drenched in sweat each time from consuming overly spicy food." Even then, many Singaporean diners loved spicy food and the general consumer expectations of Szechuan food were that it would be spicy to some extent. Thus, Tian Bao's menu also included a number of spicy dishes including mini-woks with soups in them (see Exhibit 4). These were, however, not the typical Szechuan hotpots which would have cookers underneath and boiling spicy soup in which diners would personally cook raw meats and vegetables (see Exhibit 5 for an example). Right from the start when they opened the restaurant, Jackson and Violet had also decided that they would like their cuisine to be accessible to a wider diner audience at reasonable price points. The average spending (without discounts) per diner for dinner was around SGD30-40. In Singapore, such a price point would position Tian Bao as a mid-tier mass-market restaurant. RISING POPULARITY OF SZECHUAN CUISINE The popularity of Szechuan cuisine had been rising around the world in recent years." In Singapore, it was also trending. Szechuan cuisine was identified as one of the best eight culinary traditions in China, together with Cantonese, Jiangsu, Zhejiang, Fujian, Hunan, Anhui, and Shandong cuisines. Szechuan dishes were famous for their hot-spicy taste and the numbing flavour of Szechuan peppercorn. Szechuan cuisine also had a reputation for using a variety of seasonings, giving its dishes deep and rich flavours. The most popular 1 Spiegel, A. (2015, April 4). The seductive way Sichuan cuisine is captivating America. Huffington Post. https://www.huffingtonpost.com/2015/04/14/sichuan-cuisine-in-america_n_7040538.html 3 of 9 SOM- ENTRE Page 3 ABCC-2020-001 Szechuan dishes were Szechuan Spicy (Mala) Hot Pot, Spicy Diced Chicken, and Pockmarked Granny Bean Curd. Singaporeans appreciated the hot and spicy flavours of Szechuan cuisine. HaiDiLao Hotpot, a popular Szechuan hotpot restaurant chain with over 400 outlets worldwide, had entered the Singapore market a few years ago and opened as many as 12 outlets in Singapore by August 2019. Shisen Hanten, a Szechuan restaurant located at Mandarin Orchard Singapore, was awarded two Michelin stars for three years in a row (from 2016 to 2018) for its excellence in bringing out the Szechuan's complex flavour profile. This made Shisen Hanten the highest rated Michelin-starred Chinese restaurant in Singapore, which was a definite boost to the image of Szechuan food in the country. The portal hungrygowhere.com, a food and restaurant review website commonly used by Singaporeans, listed as many as 150 Szechuan restaurants in August 2019. In spite of all these factors, it seemed that competition in the Szechuan cuisine market was much less intense than in other cuisine categories, such as Japanese (2,245 restaurants), Italian (1,100 restaurants), Korean (645 restaurants), and Cantonese (495 restaurants). With its rising popularity around the world, Szechuan cuisine was facing an identity crisis. Chefs and foodies in Szechuan were worried that the cuisine's roots would be lost due to the lack of standards and the modern adaptations. The menus were often limited to dauntingly spicy dishes, without featuring the variety and rich flavours of the cuisine. In view of this, the Szechuan provincial government had upgraded its guidelines for standard Szechuan dishes and planned to award Szechuan restaurants, both in China and overseas, Michelin-like ratings (gold, silver, and bronze pandas) so as to encourage authentic Szechuan cooking methods. This happened to be also the mission of Tian Bao: to show Singaporeans the variety and the rich and deep flavours of Szechuan cuisine. Notwithstanding that, the general consumer perception of Szechuan food was that it was very spicy and even "associated with fire". Tian Bao's version of Szechuan food, which intended to be more representative of "true-Szechuan" cuisine, could end up being perceived as rather "un-Szechuan". GENERAL TRENDS IN THE RETAIL AND F&B INDUSTRY In general, the F&B industry in Singapore was very competitive and good food was not a guarantee for success. On a per capita basis, Singapore consumers had more than twice as many dining options as did their counterparts in Hong Kong.5 Only 60% of smaller F&B businesses made it past the 5-year mark. Because declining footfall at shopping malls, F&B operators had to find ways to attract customers to come to their outlets rather than rely on walk-ins from shoppers. Evidently, Singaporean households increasingly spent more eating out (see Table 1), and, expenditures on dining out at restaurants, cafes and pubs had been increasing at a faster rate than those for other categories (see Figure 1). 2 Koh, M. (2017, March 25). Trending now: Why Sichuan cuisine is peppering Singapore's food scene. The Peak Magazine. http://thepeakmagazine.com.sg/gourmet-travel/sichuan-on-the-rise/ The Straits Times. (2016, June 20). Sichuan cuisine facing a crisis. http://www.straitstimes.com/lifestyle/food/sichuan-cuisine- facing-a-crisis *McGonagle, K (2016, December 1). Sample Sichuan food in Chengdu: Home of the fiery fondue-like hot pot. The Telegraph. https://www.telegraph.co.uk/travel/discover-chengdu/sichuan-food/ Restaurant Association of Singapore. (2016). Turning passion into profits. https://www.enterprisesg.gov.sg/- /media/esg/files/industries/food-services/guidebook_turning passion_into_profits.pdf?la=en * See Note 5. Page 4 ABCC-2020-001 Table 1: Household Expenditure, 2007/08-2017/18 Total Average Monthly Household Expenditure" -ASIACASE.COM THE ASIAN BUSINESS CASE CENTRE 2007/08 2012/13 2017/18 3809 4724 4906 592 764 810 Average Monthly Household Expenditure on Food Serving Services^ *Expenditure data excluded imputed rental of owner-occupied accommodation. * Food servicing services included meals bought from restaurants, hawker centres, food courts, etc. Source: Singapore Department of Statistics, 2019? Figure 1: Average Monthly Expenditure by Types of Food Serving Services, 2007/08-2017/18 $500 $435 $450 $400 $381 $350 $300 $250 $200 $159 $150 $100 $52 $50 2007/08 $437 $296 $267 2012/13 $63 2017/18 $77 Hawker Centers, Food Courts, Coffee Shops, Canteens, Kiosks, and Street Vendors Restaurants, Cafes, and Pubs Fast Food Restaurants & Others Note that the total amounts in Table 1 and the total amounts shown in this figure were slightly different due to rounding errors. Source: Singapore Department of Statistics, 2019' Besides the competitive business landscape, F&B operators also faced challenges such as shortage of manpower, rising labour costs, high rental costs, and low barriers to entry. To deal with these challenges, a number of F&B operators had begun exploring innovative ways of operating their businesses. For example, the adoption of manpower-lean formats (e.g., vending machine cafes and grab-and-go kiosks) and the use of central kitchens could reduce the reliance on manpower. Those formats also used less space which in turn reduced rental costs. The use of in-store technologies (e.g., e-menu to order) also reduced the need for manpower and provided a more streamlined process for ordering and payment. Food delivery services (e.g., Foodpanda and Deliveroo) also helped F&B businesses maximise the utilisation of 7 Singapore Department of Statistics. (2019). Report on the Household Expenditure Survey, 2017/18. https://www.singstat.gov.sg/- /media/files/publications/households/hes201718.pdf ASIACASE.COM- THE ASIAN BUSINESS CASE CENTRE Page 5 ABCC-2020-001 their kitchen capacities without having to attract customers to their outlets, but the rising popularity of these services had also led to other concerns, such as challenges in predicting the dine-in/take-out mix, maintenance of quality and safety of delivered food, and the increased use of plastics which negatively impacted the environment. THE POSITIONING CHALLENGE Jackson and Violet Zhang needed to make a number of critical decisions and considerations as they mulled over the positioning of the Tian Bao brand. First, as a relatively small player in the F&B scene in Singapore and as a restaurant located in a non-central district in Singapore, how could Tian Bao establish itself as a distinctive F&B brand that would have nationwide recognition? Along what perceptual dimensions should Tian Bao position its brand to set itself that would set it apart from competitors and occupy a unique place in the consumers' minds? Second, as a restaurant endeavouring to show the Singaporean consumer population a different (more balanced and refined) side of Szechuan cuisine, how could the brand overcome general Singapore perception that Szechuan food is mostly about spicy hotpots? Relatedly, what are some strategies a small brand could adopt to compete with large and powerful brands such as HaiDiLao Hotpot whose names are almost synonymous with the product category? Third, which particular consumer segments should Tian Bao target in order to gain rapid recognition as a consumer brand? Should Tian Bao focus on serving the family segment or the young millennial consumer market? Next, how could Tian Bao more effectively communicate its intended brand image to the consumer market? Furthermore, should Tian Bao make use of latest retail and F&B technologies such as e-menu, vending machines, and food delivery services to both enhance its service productivity and present itself as a youthful and progressive brand? As Jackson pondered over these issues, he set off to meet Violet, who also might have her own opinions as to how to position the Tian Bao brand. Page 6 ABCC-2020-001 -ASIACASE.COM THE ASIAN BUSINESS CASE CENTRE EXHIBIT 1: INTERIOR OF TIAN BAO'S FIRST RESTAURANT AT NGEE ANN CITY Source: Tian Bao Szechuan Restaurant website. (n.d.). www.tianbaorestaurant/outlet ASIACASE.COM- THE ASIAN BUSINESS CASE CENTRE Page 7 ABCC-2020-001 EXHIBIT 2: INTERIOR OF TIAN BAO'S SECOND RESTAURANT AT HILLION MALL Source: Tian Bao Szechuan Restaurant website. (n.d.). www.tianbaorestaurant/outlet Page 8 ABCC-2020-001 EXHIBIT 3: SOME DISHES ON TIAN BAO'S MENU Source: Tian Bao Szechuan Restaurant website. (n.d.). www.tianbaorestaurant/outlet EXHIBIT 4: TIAN BAO'S SPICY MINI-WOKS Source: Tian Bao Szechuan Restaurant website. (n.d.). www.tianbaorestaurant/outlet -ASIACASE.COM THE ASIAN BUSINESS CASE CENTRE ASIACASE.COM- THE ASIAN BUSINESS CASE CENTRE EXHIBIT 5: AN EXAMPLE OF TRADITIONAL SZECHUAN HOTPOT Source: Jesq Lee [@jesqleeyogawithlove]. (2019). Instagram post. https://www.instagram.com/jesqleeyogawithlove Page 9 ABCC-2020-001 Read the given Case Study and Answer following all questions. 1. Given the restriction and challenges as small business, how could Tian Bao establish itself as a distinctive F&B brand that would have nationwide recognition by applying design thinking approaches? 2. What are some strategies a small brand could adopt to compete with large and powerful brands like HaiDiLao Hotpot whose names are almost synonymous with the product category? 3. Which particular consumer segments should Tian Bao target in order to gain rapid recognition as a consumer brand? Should Tian Bao focus on serving the family segment or the young millennial consumer market? 4. Along what perceptual dimensions should Tian Bao position its brand to set itself apart from competitors and occupy a unique place in the consumers' minds? (Support your answer with Perceptual Map and Value Canvas Model. Develop Positioning Statement for the Brand) 5. Should Tian Bao make use of latest retail and F&B technologies such as e-menu, vending machines, and food delivery services to both enhance its service productivity and present itself as a youthful and progressive brand? 1 of 9 NANYANG TECHNOLOGICAL Nanyang Business School UNIVERSITY SINGAPORE ASIACASE.COM THE ASIAN BUSINESS CASE CENTRE TIANBAO SZECHUAN KITCHEN: POSITIONING AN F&B BRAND On July 6, 2019, a Saturday evening, Jackson Zhang, co-owner of Tian Bao Szechuan Kitchen, stood at the dining hall of his 4-year-old restaurant located at Hillion Mall, a shopping mall located in Bukit Panjang. a residential district in the western part of Singapore. Satisfied with the crowd and how busy the restaurant was, he thought to himself, "As a small restaurant, my business is pretty good and I have the support of a core group of customers who are residents in Bukit Panjang. But how do I make the Tian Bao name a much more distinctive food and beverage (F&B) brand to the broader population of Singaporean diners?" He started reflecting on what made Tian Bao and its offerings special to customers who patronised the restaurant, and whether Tian Bao as a Szechuan cuisine restaurant stood out among the many competitors in the growing but increasingly crowded Szechuan food space. TIAN BAO SZECHUAN KITCHEN OVER THE YEARS Tian Bao Szechuan Kitchen was a restaurant that served authentic cuisine from Szechuan (or, more formally, Sichuan, which was a province in the southwestern region of China). Jackson Zhang, a 28-year old Chinese national living in Singapore, co-owned the restaurant with his wife, Violet Zhang, also a Chinese national. Jackson and Violet had both studied in Singapore since their teenage years and graduated from local public universities. They had known each other from school and shared a passion for food. When they each graduated from university in 2012 with a business degree, they did what most Singaporean graduates would do: worked for large multinational firms. Jackson spent three years with Citibank in a private wealth management role, whereas Violet worked as a financial analyst with an investment bank. Shortly after they got married in early 2015, they decided they would pursue their mutual dream of starting a restaurant business. It was not a difficult decision for them to choose Szechuan food as the cuisine to offer at their restaurant, as Szechuan was their shared hometown cuisine. Page 2 ABCC-2020-001 -ASIACASE.COM THE ASIAN BUSINESS CASE CENTRE With some startup capital contributed by their parents and supplemented by some personal savings, they opened Tian Bao Szechuan Kitchen at Ngee Ann City, a prime mall located on Orchard Road, a central shopping district in Singapore. The mall, connected to two large office towers and was tenanted by masstige and luxury stores such as Coach, Zara, Tiffany & Co., Mont Blanc, and Chanel, which generally served the mid-to-upper-mid-tier shopper crowd throughout the week, and the office crowd during weekdays. The restaurant was located on Level 5, a dining and lifestyle floor where a number of other mid-priced restaurants (including a Korean BBQ restaurant, a Japanese Sushi restaurant, and a Thai casual dining restaurant) could be found. Tian Bao occupied a floor area of around 200 square metres and was renovated in a rather upscale though not extravagant manner (see Exhibit 1). The dining furniture, made of premium wood, was specially imported from Szechuan. In March 2017, Tian Bao opened a second outlet at Hillion Mall in Bukit Panjang in the western part of Singapore (see Exhibit 2). In contrast to Ngee Ann City, Hillion Mall was a neighbourhood mall situated in a residential district. The mall was connected to the Hillion Residences condominium, a large 546-unit private residential development that had direct access to the Mass Rapid Transit (MRT) and Light Rail Transift (LRT) lines in the heart of the Bukit Panjang district. The mall was a family and lifestyle retail complex that included a supermarket, home and furnishings shops, beauty and wellness centres, F&B joints, and various other types of stores. Most of the stores were positioned to target mid-tier shopper crowds, and the shoppers mostly dressed casually since the area was a residential district. Business at the Hillion Mall outlet was brisk, and, coupled with the rising operating costs at Ngee Ann City, Tian Bao quickly moved itsentire operations to Hillion. THE TIAN BAO MENU Unlike many other Szechuan food eateries in Singapore that served ultra-spicy hotpot dishes, Tian Bao's menu offered more refined items, such as cold appetisers, Dim Sum, specialty side dishes, and Szechuan traditional desserts (see Exhibit 3). According to Jackson, "I would like Singaporean diners to experience and appreciate a wider spectrum of Szechuan cuisine without getting themselves drenched in sweat each time from consuming overly spicy food." Even then, many Singaporean diners loved spicy food and the general consumer expectations of Szechuan food were that it would be spicy to some extent. Thus, Tian Bao's menu also included a number of spicy dishes including mini-woks with soups in them (see Exhibit 4). These were, however, not the typical Szechuan hotpots which would have cookers underneath and boiling spicy soup in which diners would personally cook raw meats and vegetables (see Exhibit 5 for an example). Right from the start when they opened the restaurant, Jackson and Violet had also decided that they would like their cuisine to be accessible to a wider diner audience at reasonable price points. The average spending (without discounts) per diner for dinner was around SGD30-40. In Singapore, such a price point would position Tian Bao as a mid-tier mass-market restaurant. RISING POPULARITY OF SZECHUAN CUISINE The popularity of Szechuan cuisine had been rising around the world in recent years." In Singapore, it was also trending. Szechuan cuisine was identified as one of the best eight culinary traditions in China, together with Cantonese, Jiangsu, Zhejiang, Fujian, Hunan, Anhui, and Shandong cuisines. Szechuan dishes were famous for their hot-spicy taste and the numbing flavour of Szechuan peppercorn. Szechuan cuisine also had a reputation for using a variety of seasonings, giving its dishes deep and rich flavours. The most popular 1 Spiegel, A. (2015, April 4). The seductive way Sichuan cuisine is captivating America. Huffington Post. https://www.huffingtonpost.com/2015/04/14/sichuan-cuisine-in-america_n_7040538.html 3 of 9 SOM- ENTRE Page 3 ABCC-2020-001 Szechuan dishes were Szechuan Spicy (Mala) Hot Pot, Spicy Diced Chicken, and Pockmarked Granny Bean Curd. Singaporeans appreciated the hot and spicy flavours of Szechuan cuisine. HaiDiLao Hotpot, a popular Szechuan hotpot restaurant chain with over 400 outlets worldwide, had entered the Singapore market a few years ago and opened as many as 12 outlets in Singapore by August 2019. Shisen Hanten, a Szechuan restaurant located at Mandarin Orchard Singapore, was awarded two Michelin stars for three years in a row (from 2016 to 2018) for its excellence in bringing out the Szechuan's complex flavour profile. This made Shisen Hanten the highest rated Michelin-starred Chinese restaurant in Singapore, which was a definite boost to the image of Szechuan food in the country. The portal hungrygowhere.com, a food and restaurant review website commonly used by Singaporeans, listed as many as 150 Szechuan restaurants in August 2019. In spite of all these factors, it seemed that competition in the Szechuan cuisine market was much less intense than in other cuisine categories, such as Japanese (2,245 restaurants), Italian (1,100 restaurants), Korean (645 restaurants), and Cantonese (495 restaurants). With its rising popularity around the world, Szechuan cuisine was facing an identity crisis. Chefs and foodies in Szechuan were worried that the cuisine's roots would be lost due to the lack of standards and the modern adaptations. The menus were often limited to dauntingly spicy dishes, without featuring the variety and rich flavours of the cuisine. In view of this, the Szechuan provincial government had upgraded its guidelines for standard Szechuan dishes and planned to award Szechuan restaurants, both in China and overseas, Michelin-like ratings (gold, silver, and bronze pandas) so as to encourage authentic Szechuan cooking methods. This happened to be also the mission of Tian Bao: to show Singaporeans the variety and the rich and deep flavours of Szechuan cuisine. Notwithstanding that, the general consumer perception of Szechuan food was that it was very spicy and even "associated with fire". Tian Bao's version of Szechuan food, which intended to be more representative of "true-Szechuan" cuisine, could end up being perceived as rather "un-Szechuan". GENERAL TRENDS IN THE RETAIL AND F&B INDUSTRY In general, the F&B industry in Singapore was very competitive and good food was not a guarantee for success. On a per capita basis, Singapore consumers had more than twice as many dining options as did their counterparts in Hong Kong.5 Only 60% of smaller F&B businesses made it past the 5-year mark. Because declining footfall at shopping malls, F&B operators had to find ways to attract customers to come to their outlets rather than rely on walk-ins from shoppers. Evidently, Singaporean households increasingly spent more eating out (see Table 1), and, expenditures on dining out at restaurants, cafes and pubs had been increasing at a faster rate than those for other categories (see Figure 1). 2 Koh, M. (2017, March 25). Trending now: Why Sichuan cuisine is peppering Singapore's food scene. The Peak Magazine. http://thepeakmagazine.com.sg/gourmet-travel/sichuan-on-the-rise/ The Straits Times. (2016, June 20). Sichuan cuisine facing a crisis. http://www.straitstimes.com/lifestyle/food/sichuan-cuisine- facing-a-crisis *McGonagle, K (2016, December 1). Sample Sichuan food in Chengdu: Home of the fiery fondue-like hot pot. The Telegraph. https://www.telegraph.co.uk/travel/discover-chengdu/sichuan-food/ Restaurant Association of Singapore. (2016). Turning passion into profits. https://www.enterprisesg.gov.sg/- /media/esg/files/industries/food-services/guidebook_turning passion_into_profits.pdf?la=en * See Note 5. Page 4 ABCC-2020-001 Table 1: Household Expenditure, 2007/08-2017/18 Total Average Monthly Household Expenditure" -ASIACASE.COM THE ASIAN BUSINESS CASE CENTRE 2007/08 2012/13 2017/18 3809 4724 4906 592 764 810 Average Monthly Household Expenditure on Food Serving Services^ *Expenditure data excluded imputed rental of owner-occupied accommodation. * Food servicing services included meals bought from restaurants, hawker centres, food courts, etc. Source: Singapore Department of Statistics, 2019? Figure 1: Average Monthly Expenditure by Types of Food Serving Services, 2007/08-2017/18 $500 $435 $450 $400 $381 $350 $300 $250 $200 $159 $150 $100 $52 $50 2007/08 $437 $296 $267 2012/13 $63 2017/18 $77 Hawker Centers, Food Courts, Coffee Shops, Canteens, Kiosks, and Street Vendors Restaurants, Cafes, and Pubs Fast Food Restaurants & Others Note that the total amounts in Table 1 and the total amounts shown in this figure were slightly different due to rounding errors. Source: Singapore Department of Statistics, 2019' Besides the competitive business landscape, F&B operators also faced challenges such as shortage of manpower, rising labour costs, high rental costs, and low barriers to entry. To deal with these challenges, a number of F&B operators had begun exploring innovative ways of operating their businesses. For example, the adoption of manpower-lean formats (e.g., vending machine cafes and grab-and-go kiosks) and the use of central kitchens could reduce the reliance on manpower. Those formats also used less space which in turn reduced rental costs. The use of in-store technologies (e.g., e-menu to order) also reduced the need for manpower and provided a more streamlined process for ordering and payment. Food delivery services (e.g., Foodpanda and Deliveroo) also helped F&B businesses maximise the utilisation of 7 Singapore Department of Statistics. (2019). Report on the Household Expenditure Survey, 2017/18. https://www.singstat.gov.sg/- /media/files/publications/households/hes201718.pdf ASIACASE.COM- THE ASIAN BUSINESS CASE CENTRE Page 5 ABCC-2020-001 their kitchen capacities without having to attract customers to their outlets, but the rising popularity of these services had also led to other concerns, such as challenges in predicting the dine-in/take-out mix, maintenance of quality and safety of delivered food, and the increased use of plastics which negatively impacted the environment. THE POSITIONING CHALLENGE Jackson and Violet Zhang needed to make a number of critical decisions and considerations as they mulled over the positioning of the Tian Bao brand. First, as a relatively small player in the F&B scene in Singapore and as a restaurant located in a non-central district in Singapore, how could Tian Bao establish itself as a distinctive F&B brand that would have nationwide recognition? Along what perceptual dimensions should Tian Bao position its brand to set itself that would set it apart from competitors and occupy a unique place in the consumers' minds? Second, as a restaurant endeavouring to show the Singaporean consumer population a different (more balanced and refined) side of Szechuan cuisine, how could the brand overcome general Singapore perception that Szechuan food is mostly about spicy hotpots? Relatedly, what are some strategies a small brand could adopt to compete with large and powerful brands such as HaiDiLao Hotpot whose names are almost synonymous with the product category? Third, which particular consumer segments should Tian Bao target in order to gain rapid recognition as a consumer brand? Should Tian Bao focus on serving the family segment or the young millennial consumer market? Next, how could Tian Bao more effectively communicate its intended brand image to the consumer market? Furthermore, should Tian Bao make use of latest retail and F&B technologies such as e-menu, vending machines, and food delivery services to both enhance its service productivity and present itself as a youthful and progressive brand? As Jackson pondered over these issues, he set off to meet Violet, who also might have her own opinions as to how to position the Tian Bao brand. Page 6 ABCC-2020-001 -ASIACASE.COM THE ASIAN BUSINESS CASE CENTRE EXHIBIT 1: INTERIOR OF TIAN BAO'S FIRST RESTAURANT AT NGEE ANN CITY Source: Tian Bao Szechuan Restaurant website. (n.d.). www.tianbaorestaurant/outlet ASIACASE.COM- THE ASIAN BUSINESS CASE CENTRE Page 7 ABCC-2020-001 EXHIBIT 2: INTERIOR OF TIAN BAO'S SECOND RESTAURANT AT HILLION MALL Source: Tian Bao Szechuan Restaurant website. (n.d.). www.tianbaorestaurant/outlet Page 8 ABCC-2020-001 EXHIBIT 3: SOME DISHES ON TIAN BAO'S MENU Source: Tian Bao Szechuan Restaurant website. (n.d.). www.tianbaorestaurant/outlet EXHIBIT 4: TIAN BAO'S SPICY MINI-WOKS Source: Tian Bao Szechuan Restaurant website. (n.d.). www.tianbaorestaurant/outlet -ASIACASE.COM THE ASIAN BUSINESS CASE CENTRE ASIACASE.COM- THE ASIAN BUSINESS CASE CENTRE EXHIBIT 5: AN EXAMPLE OF TRADITIONAL SZECHUAN HOTPOT Source: Jesq Lee [@jesqleeyogawithlove]. (2019). Instagram post. https://www.instagram.com/jesqleeyogawithlove Page 9 ABCC-2020-001 Read the given Case Study and Answer following all questions. 1. Given the restriction and challenges as small business, how could Tian Bao establish itself as a distinctive F&B brand that would have nationwide recognition by applying design thinking approaches? 2. What are some strategies a small brand could adopt to compete with large and powerful brands like HaiDiLao Hotpot whose names are almost synonymous with the product category? 3. Which particular consumer segments should Tian Bao target in order to gain rapid recognition as a consumer brand? Should Tian Bao focus on serving the family segment or the young millennial consumer market? 4. Along what perceptual dimensions should Tian Bao position its brand to set itself apart from competitors and occupy a unique place in the consumers' minds? (Support your answer with Perceptual Map and Value Canvas Model. Develop Positioning Statement for the Brand) 5. Should Tian Bao make use of latest retail and F&B technologies such as e-menu, vending machines, and food delivery services to both enhance its service productivity and present itself as a youthful and progressive brand?