More Than Just Kopi: 5 Surprising Strategies Fueling Singapore’s Coffee Shop Giant

Introduction: The Coffee Shop You Think You Know

For many Singaporeans, the neighbourhood coffee shop, or kopitiam, is a sensory anchor in a rapidly modernising city. It’s the clatter of ceramic cups on saucers, the fragrant steam of freshly pulled kopi, and the comforting reliability of kaya toast. This seemingly simple institution feels like an unchanging part of the local landscape, a familiar constant in daily life.

But what if the humble coffee shop on your corner is part of a sophisticated, modern empire hiding in plain sight?

A recent look into the business operations of Kimly, one of Singapore’s largest coffee shop operators, reveals a company that is far more complex and strategic than its traditional facade suggests. Here are five surprising strategies that go far beyond just selling coffee and tea, demonstrating how this giant is quietly reshaping the industry.

1. They’re a Food Empire in Disguise

While the “Kimly” name is synonymous with coffee shops, the group’s portfolio is a surprisingly vast and diverse food empire. As of fiscal year 2025, the company operates an extensive network of 89 food outlets and 195 food stalls.

What’s truly striking is the diversity of their brands. Beyond the expected mixed rice and dim sum stalls, Kimly has deliberately expanded into multiple, distinct market segments. This includes a robust collection of Halal-certified brands under the Kedai Kopi and Tenderfresh banners, as well as full-service Japanese restaurants like Tonkichi. This is a calculated strategy to capture a wide array of diners—from the daily lunch crowd to Halal consumers and fans of authentic Japanese cuisine—all under one corporate umbrella.

2. They’re Not Just Renting—They’re Buying the Building

Contrary to the common F&B model of leasing space, Kimly is also a significant real estate player. The company has a clear strategy of acquiring the coffee shop properties it operates, particularly in mature residential estates. In FY2025 alone, the group made two major acquisitions: the property at Block 204 Serangoon Central for S13.15 million and another at 110 Yishun Ring Road for S11.00 million.

This ownership model is a core part of what the company calls its “Foundation Leases.” As of September 2025, over 70% (specifically 70.8%) of Kimly’s outlets are under leases that provide stability and certainty because they are either owned by the group, leased directly from the HDB, or leased from its founding partners. This powerful strategy shields the business from the volatility of the private rental market, controls long-term costs, and builds a valuable portfolio of physical assets.

3. ‘Traditional’ Is a Trojan Horse for Modern Operations

The traditional appearance of a Kimly coffee shop masks a highly modern and efficient operational backend. The company actively leverages innovative concepts and technology to boost productivity and adapt to modern consumer habits.

One key example is the “shared kitchen concept” implemented at its Kedai Kopi outlets in Yishun and Haig Road. This model houses multiple in-house brands—such as 380 Nasi Lemak, Pasta Pizza, and Tenderbest—within a single kitchen, allowing the group to maximize space, streamline manpower, and offer greater variety. To further reduce its reliance on manual labour, Kimly has also introduced technology like the Rotary oven across several of its newly opened and renovated outlets.

Furthermore, the company has embraced the digital economy by forming strategic partnerships with popular platforms like ShopBack and Kris+. These collaborations help reach new, digitally-savvy customer segments, drive sales through rewards programs, and gather valuable data for targeted marketing.

4. They’re a Quiet Powerhouse in Halal Cuisine

The Group’s Halal business is not just an add-on; it’s a significant and rapidly growing powerhouse in its own right. The number of outlets under its Halal Tenderfresh brands has expanded steadily, growing from 44 outlets in FY2022 to 53 in FY2025.

This commitment to the Halal segment has earned the company significant recognition. During the Singapore Halal International Seminar (SHIS) in 2025, the Tenderfresh Group was chosen as the host company for an immersion trip for international representatives. This distinction was awarded in recognition of the group’s “exceptional standards in integrating Halal compliance with modern manufacturing,” underscoring its leadership and commitment to excellence in this important market.

5. In a Tough Market, They’re a Resilient Cash Machine

The F&B industry currently faces significant headwinds, including rising operating costs, persistent manpower shortages, and intense competition. Despite this challenging environment, Kimly has demonstrated remarkable financial resilience. In FY2025, the Group’s gross profit increased by 3.8% to S$94.1 million.

For observers and shareholders, the most impactful financial takeaway is the company’s firm commitment to delivering shareholder returns. The total dividend declared for FY2025 represents a payout ratio of 74.8% of the net profit attributable to owners. This signals a confident and stable business capable of generating strong cash flow even in a difficult market.

As the Directors of Kimly stated:

“The F&B landscape remained challenging amid rising costs and intense competition. Despite these headwinds, the Group delivered a resilient performance in FY2025… Looking ahead, we remain focused on expanding our network of food outlets and exploring opportunities to establish new outlets in strategic, high foot traffic locations within mature estates. This approach will strengthen the Group’s market presence and improve accessibility for a wider customer base.”

Conclusion: The Future of the Neighbourhood Hub

The evidence is clear: the “traditional” Singaporean coffee shop is evolving. Behind the familiar facade of Kimly lies a sophisticated, diversified, and strategically-run business that is part food empire, part real estate firm, and part modern operational innovator. By diversifying its brands, owning its properties, embracing technology, and leading in key growth segments like Halal dining, Kimly is building a resilient and formidable presence in Singapore’s F&B landscape.

This raises an important question for the future. As these coffee shop giants continue to innovate and consolidate, what does the future hold for the independent hawkers and small family-run outlets that define so much of Singapore’s food culture?

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