Dont look down on those wearing singlet, shorts & flip flops

[Scb11980]

Keen appetite for roast meat joint

 

22 March 2012

Straits Times

THE asking price for the famed recipe and premises of Kay Lee Roast Meat Joint is a cool $3.5 million, but one day after this was reported, inquiries came streaming in.

 

More than 40 parties - 39 from Singapore - have expressed interest, with the two highest bids at $2.5 million and $2.8 million.

 

Senior property consultant Raymond Lo of Knight Frank, the real estate broker for Kay Lee's owners, said: 'Most of the callers are businessmen or restaurant operators, and most are interested in hiring people to work for them. It's an investment of sorts.'

 

Mr Lo, who is confident he will close a deal by the year end, obviously thinks the eventual buyer will have a clear winner on his hands. He said: 'It's profitable. As long as you take over, you make money.'

 

But the owners of the 30-year-old eatery, Madam Betty Kong, 66, and her husband Ha Wai Kay, 62, are anxious as they want the Guangzhou-style recipe for Kay Lee's signature pork ribs, char siew and duck, for example, to stay true to tradition after the change in ownership.

 

Madam Kong, the spokesman for the business, told The Straits Times that the 50-year-old recipe, which she and her husband have priced at $2 million, was 'not just a piece of paper'.

 

The buyer will be taught how to roast the signature Kay Lee duck 'until they perfected the recipe', said the chatty woman.

 

'The price includes the brand name. We will teach them till they pass,' she quipped.

 

The hothousing in Kay Lee's art of roasting meats is expected to take two to three months.

 

With the recipe at $2 million, the remaining sum is for the freehold shop space in Upper Paya Lebar Road, a 1,313 sq ft space valued at $1.25 million, said Mr Lo.

 

In testimony to Kay Lee's popularity - or because of the news of its impending sale - a line of customers was waiting to be served yesterday when The Straits Times dropped by. Some people ate there, but others were buying takeaways.

 

So is the asking price too high?

 

Madam Kong, who lives with her husband in a four-room bungalow in Hougang and drives a grey Mercedes-Benz, said she was aware that many parties think the asking price is a tad stiff.

 

'We are considering the offers,' she said, volunteering the information that the shop makes a net profit of at least $2,000 a day.

 

The president of the Restaurant Association of Singapore, Mr Ang Kiam Meng, said that, going by gut feel, the price seems high, and urged buyers to crunch the numbers.

 

'Without proper analysis, it's difficult to tell whether the price is really too high. It depends on how the investor looks at it,' he said.

 

Mr Ang, who runs the Jumbo chain of restaurants, suggested that Madam Kong and her husband act as consultants post-sale.

 

'A business is usually way more than just a recipe and a brand name. It's about management; there are many things that can go wrong when there is a takeover,' he said.

 

Madam Kong and her husband have put up the business for sale because neither of their two children want to run it.

 

Potential buyers who were contacted said they are doing the maths.

 

A 35-year-old IT manager who asked to be known only as Ben said he hopes to clinch the sale and run the place with three friends.

 

'We think we can make the business work, as long as we have a good team behind us. It's not rocket science,' he said.

 

Another prospective buyer identified himself as the one behind the $2.5 million bid, but declined to elaborate.

 

And then there is Mr Jackie Goh, 48, who runs a roast duck business in Phillip Street in Chinatown. He said he spoke to Kay Lee's owners three weeks ago, but decided against making an offer.

 

'We think we'll not be able to break even so quickly. The price is quite high,' he said, adding that he could offer no more than $1.8 million.

 

He said he bought his current roast duck stall and recipe for $200,000 just five months ago.

 

He added, chuckling: 'I didn't dare make an offer. They may chase me out.'

 

 

 

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What other hawkers say

 

PRICELESS RECIPE

 

'Our recipe is priceless, we cannot put a value to it and we will never sell it. It is a family heirloom and we will pass it on to our children.'

 

Mr Lim Swee Seng, 42, who runs Toa Payoh Rojak at Old Airport Road Food Centre. The stall has been around since 1971

 

 

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REASONABLE PRICE

'The $2 million price seems like a reasonable price to pay for a secret recipe. The brand has been built up over the years. If I sell my recipe, I will also price it at around $2 million.'

 

Mr Chia Kar Wing, 49, owner of Union Farm Eating House which closed last month. It is famous for its paper-wrapped chicken dish and its owner plans to start business again soon

 

 

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TOO EXPENSIVE

'Buy a roast duck recipe for $2 million? That's too expensive. Even if we sell our recipe for $30,000, we doubt people will want to buy it. It's very tough to make these traditional dishes, we spend a lot of effort getting everything right. If we ever sell our recipes, we would want to train the person for at least one year and teach him exactly how to cook the food and maintain the same quality we had.'

 

Mr Richard Ng, 58, who is co-owner of China Street Fritters at Maxwell Food Centre. The stall is famous for its traditional ngoh hiang (pork rolled in bean curd skin) dish going back 70 years

 

 

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DISH ISN'T RARE ENOUGH

'To pay $2 million is too much, especially for roasted meats. You can find that anywhere in Singapore. The price should depend on how rare the food is in Singapore. For example, oyster cakes are hard to find now. It's a traditional Fuzhou dish and our own oyster cake recipe was passed down from mother to daughter for generations.'

 

Madam P. Hoon, 54, who helps her mother run the famous Maxwell Fuzhou Oyster Cake stall at Maxwell Food Centre. She said she would be happy to sell her oyster cake recipe for $50,000

 

 

[Tom_kkh]

i sell marbles. usually ah bengs and those chinese speaking client will confirm marbles of $20k above on the spot without any qualm or begging for discounts.

 

those wear tie nice nice ppl, wan discount, wat this want that, need to think about it, than come back ask for discounts. blah blah blah.

 

last month i just served a ah beng, totally cannot speak english, drives a X5, ave a bungalow in Serangoon gardens with a swimming pool.

 

He came in with shots and t-shirt, asked about the price. less than 15 mins, he gave me cash (half of the total price, 20K) for reservation of the stone.

 

very impressive.. and he is not the only ah beng i served that confirm on the spot.

 

[Vhtfhwlego]

my vendors are dealing with me (ah-beng)...

the problem is, they are also bengs

[Mockngbrd]

i like Ah Lians .

[2009k]

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DISH ISN'T RARE ENOUGH

'To pay $2 million is too much, especially for roasted meats. You can find that anywhere in Singapore. The price should depend on how rare the food is in Singapore. For example, oyster cakes are hard to find now. It's a traditional Fuzhou dish and our own oyster cake recipe was passed down from mother to daughter for generations.'

 

Madam P. Hoon, 54, who helps her mother run the famous Maxwell Fuzhou Oyster Cake stall at Maxwell Food Centre. She said she would be happy to sell her oyster cake recipe for $50,000

 

She knows how to price her biz or not? $50k if she really willing to let go, think lots will buy the receipt from her. For one, OldCK will throw $50k and get her receipt to recreate oyster cake to be sold via their chain. Easily make back that $50k in a week...

 

Funny how people look down on themselves...

[Donut]

Actually, based on net profit of $2000 per day, the asking price of 3.5 million is not alot leh

 

In a month, it's $60k profit. In one year, it's $720k. You can recoup 3.5 million in abt 4 yrs, all things remain consistent.

 

It makes biz sense to buy this.

[2009k]

Actually, based on net profit of $2000 per day, the asking price of 3.5 million is not alot leh

 

In a month, it's $60k profit. In one year, it's $720k. You can recoup 3.5 million in abt 4 yrs, all things remain consistent.

 

It makes biz sense to buy this.

 

 

That's why I say these bidders are just trying to cook it cheaper. Those kena interview and said it's too overpriced are just trying to spoil the deal. Since they are not on the receiving end of the 3.5mil why they wanna help secure it?

[Watwheels]

This is obviously buying the brand , not so much of the recipe. I have tried & tasted their food and it's not what I had in mind, it's nothing special and the taste isn't great either. Hawkers selling the same food in Chinatown or Tiong Bahru hawker centre can easily beat them on taste hands down.

[Theoldjaffa]

Actually, based on net profit of $2000 per day, the asking price of 3.5 million is not alot leh

 

In a month, it's $60k profit. In one year, it's $720k. You can recoup 3.5 million in abt 4 yrs, all things remain consistent.

 

It makes biz sense to buy this.

Provided what they say is true, and you can maintain it increase that level of GP..

 

Else.. it will take many more years.

[Tigerwoods]

Actually, based on net profit of $2000 per day, the asking price of 3.5 million is not alot leh

 

In a month, it's $60k profit. In one year, it's $720k. You can recoup 3.5 million in abt 4 yrs, all things remain consistent.

 

It makes biz sense to buy this.

Food cooked by OLD hand will always tasted better than Food cooked by Employees of restaurant paid a meagre sum.

I will not eat from that store if the Old man retires.

Edited March 23, 2012 by Tigerwoods

[2009k]

Food cooked by OLD hand will always tasted better than Food cooked by Employees of restaurant paid a meagre sum.

I will not eat from that store if the Old man retires.

 

 

Have not tasted their recipe, but so far I like 金山嶺 roast duck and roast meat best.

[Sotong_kia]

Why is everything judged on money ? Ppl who wear slippers, but have secret bungalows, etc.. so don't look down on them.

 

If / When I look down at ppl, it is about their attitude, their intellect, their behaviour, NOT about how much or how little money they have.

 

So what if they are rich, have lots of money, but lack personal hygene, spit on your floor and think it is ok. Or dig their nose and flick it. Etc.

So what if they are billionaire ? I will still look down on them, because they have not progress in terms of hygene, courtesy, etc.

 

Basically, most ah tiong nowadays are rich, richer than most of us.... but why still dislike them ?

[Gz0707]

the older pp are really cash rich, own condos, no cars and no loans. money mostly in stocks and fixed deposits.

 

the younger pp I know are really dumb, buy cars, buy condos, always post pics of restaurant meals on fb and rolling over credit card bills. this group will pay once the bubble bursts.

[KARTer]

i sell marbles. usually ah bengs and those chinese speaking client will confirm marbles of $20k above on the spot without any qualm or begging for discounts.

 

those wear tie nice nice ppl, wan discount, wat this want that, need to think about it, than come back ask for discounts. blah blah blah.

 

last month i just served a ah beng, totally cannot speak english, drives a X5, ave a bungalow in Serangoon gardens with a swimming pool.

 

He came in with shots and t-shirt, asked about the price. less than 15 mins, he gave me cash (half of the total price, 20K) for reservation of the stone.

 

very impressive.. and he is not the only ah beng i served that confirm on the spot.

wah, so rich...

 

next time i come to your shop in singlet n shorts, you also treat me nice and see me up, can? ... but i will still bargain one..............

[PaiKia-Lee]

Actually, based on net profit of $2000 per day, the asking price of 3.5 million is not alot leh

 

In a month, it's $60k profit. In one year, it's $720k. You can recoup 3.5 million in abt 4 yrs, all things remain consistent.

 

It makes biz sense to buy this.

 

U think they will tell the whole world their actual profit is just $200 a day? If i am them, i will pay for 100 blanglas to q outside my stalls daily and claim my gross profit is $20k a day

[Donut]

U think they will tell the whole world their actual profit is just $200 a day? If i am them, i will pay for 100 blanglas to q outside my stalls daily and claim my gross profit is $20k a day

 

yeah, provided they can back up with doc and income statements with it.

 

and hell they will have to show some proof, for someone to give $3.5 million to them......

[Jp66]

wah, so rich...

 

next time i come to your shop in singlet n shorts, you also treat me nice and see me up, can? ... but i will still bargain one..............

and ask for instalment

[Wyfitms]

Actually, based on net profit of $2000 per day, the asking price of 3.5 million is not alot leh

 

In a month, it's $60k profit. In one year, it's $720k. You can recoup 3.5 million in abt 4 yrs, all things remain consistent.

 

It makes biz sense to buy this.

 

4 yrs breakeven for F&B is quite long, i think... imagine, working for 4 yrs for free

 

I dun think an investor shld value the recipe this way. mainly because even without the recipe, a normal roast duck stall can also churn out decent profit. So value on the recipe shld be the premium it can generate over normal duck stalls. Then apply a market cap rate to it to arrive at an estimated value