t uncommon for international F&B brands entering markets like Singapore and Hong Kong, where media hype and consumer curiosity often drive long lines. However, sustaining that momentum is a different challenge altogether. The downfall of a US chain in Asia Following earlier exits from South Korea and Hong Kong, Eggslut shuttered its last Singapore outlet at Scotts Square in late February, marking the end of its three-year run in the country. The brand was introduced to Asia by South Korea-based SPC Group, which also operates Paris Baguette and Shake Shack in the region. With the closure of its Singapore stores, Eggslut’s only remaining presence in Asia is in Tokyo. Founded in Los Angeles in 2011 by chef Alvin Cailan and his cousin Jeff Vales, the chain currently operates 12 locations globally. Despite its cult following, known for its indulgent egg sandwiches, the brand failed to secure a long-term foothold in key Asian markets. What went wrong? Despite generating massive media buzz, Eggslut struggled to sustain interest among local customers. According to Llewellyn, while the initial excitement of a new restaurant builds short-term success due to the bandwagon effect as people want to try the latest trending restaurant and share their experiences online, long-term success comes with turning those first-time visitors into repeat diners. “With restaurants constantly opening, there is always a new place to try, causing brand fatigue for those who fail to differentiate or innovate their menus,” he said.  “International F&B brands are often open in more visible locations to draw that initial interest. Still, with Singapore and Hong Kong having some of the highest commercial rental prices, profitability becomes difficult once the initial interest dwindles.” This positioning strategy means that the restaurant has to have consistently high sales to cover the rent. When the initial hype fades and sales decline, profitability becomes difficult. Adding to these challenges, Singapore’s Progressive Wage Model for the food services sector, introduced in March 2023, has increased labour costs, further squeezing F&B operators. “Brands have to be realistic about forecasting their sales a year after opening and plan their location based on those figures, as the initial increase in sales is not an indicator of future sales,” Llewellyn added.  Price sensitivity is another factor. While consumers may be willing to splurge on a trendy international brand at first, many eventually revert to local options offering similar flavors at lower prices. Without a compelling differentiation strategy beyond brand novelty, long-term customer retention becomes difficult. Thriving market yet highly competitive Eggslut is not alone in struggling to survive in Singapore’s competitive F&B landscape. Other international brands, including Burger & Lobster, Little Caesars, Sommer, Ristorante Da Valentino and Voyage, have also exited the market. According to the Accounting and Corporate Regulatory Authority, more than 3000 F&B businesses shut down in Singapore last year, the highest number since 2005. Rising economic pressures and the increasing cost of living have made consumers more selective about dining out. As a result, many are reevaluating their priorities and cutting back on restaurant visits. “Singapore’s fast-casual dining sector is thriving but highly competitive, especially among the weekday lunch crowd,” Llewellyn said.  “As diners have countless dining options, F&B establishments must ensure that they differentiate their food or ambiance. F&B establishments must also rotate menu offerings to keep customers returning to try new or seasonal dishes. Very few fast-casual restaurants can rely on a static menu and remain competitive.” Llewellyn advised that while international brands must price their products according to their perceived value, they must also consider competitors’ prices. If diners do not feel that the international brand is worth the increased prices, they will not become returning guests.  He also said they should consider locations off the main thoroughfares that still provide ease of access, as customers will find and visit, and the reduced rental will help lower the operational costs.  Further reading: Sink or swim: Singapore’s restaurants in a state of flux.