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Benefits of Renting a Coworking Kitchen vs Owning a Commercial Kitchen

Have you thought about starting a food business? Maybe you’re planning to open an online business so the community can have better access to your healthy food products. Perhaps you want to start selling your products in retail establishments. Either way, you will need a physical space to create and store your product.

Legally, almost any food business in Singapore must be licensed with the Singapore Food Agency (SFA) certificate to ensure that food sold is safe for consumption. More importantly, food handlers including those who are home-based need to be trained and registered with SFA. Because the Home-Based Small Scale Business Scheme by HDB and URA only allows residents to prepare small quantities of food in their homes for sale, what happens if you choose to expand production and need a bigger space to meet increasing demand for your product?

You will probably be wondering how to attain the SFA license, what kind of kitchen you will need and where to find one.

The ability to rent a kitchen space is the basis for coworking kitchens.. They are certified commercial kitchens where foodservice providers can legally and safely prepare, cook, store and even sell their products – without having to own or maintain facility equipment.

Will your food business benefit from using a rental coworking kitchen? Or should you look into investing in purchasing or renting your own commercial kitchen for your business?

The answer to these questions above largely depends on your needs. In this blogpost, we’ll share 5 benefits of renting a coworking kitchen as compared to purchasing or renting a commercial kitchen.

1. Lower Overheads

Singapore remains one of the most expensive cities to live and by extension, the cost of running a business is relatively high, especially with increasing rents and as inflation peaks in 2023. In fact, CNA published a Big Read piece on 4 Feb 2023 headlined 'Are rents really killing businesses?' to expound the different perspectives on this perennial bugbear - rent. Renting a coworking kitchen space rather than owning or renting a commercial kitchen will therefore be a more affordable option for F&B start-ups as the cost for front-of-house operations, seating space, and maintenance will be eliminated. Working with coworking kitchens like IncuBaker is a low risk option you can take for your business - we absorb your high operating costs and you can seek to incur less inefficiencies.

2. Flexibility

If you have just started out and do not want to commit to a long-term property space, new F&B start-ups will benefit from the flexibility of renting a coworking kitchen priced by hour, by the month or on a membership basis, depending on what the co-working kitchen company offers. At IncuBaker, we operate 24/7 and therefore you can gain access to our coworking kitchen at any time you wish, even if you are a budding entrepreneur with a full-time 9-5 job!

3. Access to Equipment

High quality industrial scale equipment is expensive to both purchase and maintain. Equipments like KitchenAid Stand Mixer can start from almost $800 and may be too heavy an investment and even impractical especially for F&B entrepreneurs just starting out. One of the most valuable assets of a coworking Kitchen is on-demand access to these unique equipment. Therefore, before committing to purchasing equipment to fill up your commercial kitchen if you planned to own a kitchen, renting a coworking kitchen with pieces of equipment can let you use these not only at a lower cost, but also experiment with different equipment available to see what is best for your kitchen needs.

4. Turn-Key community

These coworking spaces enable interactions with other like-minded entrepreneurs in your industry. If you’re just starting out, more seasoned business owners can help you navigate the industry and offer you advice and inspiration. Access to other food businesses and events can also open the door to mutual benefits such as meeting potential supplier that could decrease your costs and collaborations for events. You never know who you will cross paths with when you rent a coworking kitchen space! As compared to owning a commercial kitchen, such networking is rare as you are essentially operating within your kitchen alone with your company.

5. Licensing

Due to the importance of obtaining a license to operate in the F&B Industry in Singapore as mentioned at the beginning, most F&B start-ups would be wondering how they can obtain the license and also the cost that comes with it. As Singapore’s first National Environment Agency-approved coworking kitchen, IncuBaker takes on your worries of the legal operations so that you don’t have to.

What is our verdict?

We believe that renting a coworking space will allow small businesses to scale quickly yet with less risk as it makes more financial sense. It provides much more flexibility and helps you avoid all the pitfalls of owning your own space, enabling you free to concentrate on growing your business and at the same time meet a like-minded community to grow your network. However, once you start to scale, you’ll eventually seek to rent or purchase your own dedicated space. Ultimately, you decide when to make the switch when it makes the most economical and feasible sense for your own business.

Thinking about starting a food business? Click here to find out how we can help!


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