SINGAPORE, 22 July 2024 — Momentum Works and Lark have released a joint report titled “Transforming Frontline Industries: Make F&B, Retail and Hospitality Greater”, providing in-depth insights into Southeast Asia’s frontline industries.

The report examines trends and best practices across six frontline sectors, which collectively employ 137 million people in Southeast Asia, or 46% of the region’s entire workforce.

The six sectors are: F&B, retail, tourism & hospitality, healthcare, transport & logistics, and manufacturing.

 

High turnover of frontline staff is a key challenge for these industries. In Southeast Asia’s frontline sectors, turnover rates can reach up to 48% annually, incurring $22.6 billion in replacement and retraining costs.

Some key report findings:
  1. The region’s frontline industries have seen robust growth. Total F&B consumption reached US$123.7 billion, surpassing pre-pandemic 2019 levels by 7%. Online retail hit US$114.6 billion, with 15% year-on-year growth, and tourist arrivals reached 96 million;
  2. The competitive landscape has significantly intensified, with 40 regional and international F&B brands opening over 7,418 new outlets between 2021 and 2023. Chinese brands comprised over half of that number;
  3. Alongside high turnover and intensifying competition, these industries face evolving customer expectations, squeezed margins, and complex supply chains.

 

Addressing these challenges requires frontline industries to enhance operational efficiency. The report presents a six-part playbook for future-proofing the frontline workforce: fostering a forward-thinking leadership mindset; building a unified company culture; ensuring fast and effective communication; agile learning; making data-driven decisions; and adopting the right digital tools to streamline operations.

 

There are frontline organisations which have risen to the challenges well. The report features case studies from Zus Coffee and Pop Mart, exploring their successful management of over 3,000 employees and 3,735 frontline staff respectively.

 

Zus Coffee has rapidly expanded to over 400 outlets in Malaysia and the Philippines while maintaining efficiency and consistency. Similarly, POP MART operates 363 retail stores and 2,190 robo shops in over 25 countries smoothly.

 

“Frontline industries, F&B and retail in particular, are facing a new set of realities post-covid,” said Jianggan Li, Founder and Chief Executive Officer of Momentum Works. “Competition will further intensify, with trend cycles shortening and shifts of consumer preferences shifting. This new environment also presents opportunities for collaborative and operationally efficient players to scale faster and more sustainability.”

 

Mark Dembitz, GM APC of Lark shared that “The resilience and adaptability of the region’s frontline industries reflected in this comprehensive report underscores the dynamic nature of these sectors. With this growth comes the challenge of intensified competition and evolving customer expectations. At Lark, we believe that the key to navigating these complexities lies in empowering frontline teams with the right tools and strategies. Lark is committed to supporting these industries by providing solutions that enhance collaboration and operational efficiency, helping them to scale sustainably and thrive.”

 

The Transforming Frontline Industries: Make F&B, Retail, and Hospitality Greater report is complimentary and can be obtained from Momentum Works’ or Lark’s website.

—

Thanks for reading The Low Down (TLD), the blog by the team at Momentum Works. Got a different perspective or have a burning opinion to share? Let us know at [email protected].