Start-Up Fever

Taking A Different Approach — Café Karung Guni

Dawn Lim looks out of place in the industrial building. In her demure black dress, she stands out against the utilitarian products that were once part of the dreams and hopes of various food and beverage (F&B) businesses.

As we wade into uncertain times, it’s not surprising that taxis and restaurants are continuing to open up opportunities for those in search of a livelihood.

Although on the surface the F&B scene appears to be flourishing, the rate of closures is equalled due to high overheads and manpower shortage in a highly competitive landscape.

Café Karung Guni, owned by previous F&B business owner Dawn Lim, has spotted an opportunity in these changing times. Rather than be at the frontline and take all the risks, she opted to think differently and enter behind the scenes.

It began when Lim set up Nook D.I.Y. House of Pancakes at the age of 23. Passionate about food and the business-aspect of restaurants, she took a stab at it as a complete greenhorn.

“Most youngsters dream of becoming a business owner, and I was no different,” Lim said.

“I went into the industry at the peak of the brunch craze in 2012, where patrons were paying over $20 at places like Wild Honey. It was my efforts to create an intriguing café concept, but I soon realised equipment recycling could be more feasible.”

After spending six months visiting restaurants around Singapore, analysing menus and studying operations, she found a gap in the market, which was not as glamorous, but steadier.

“Retaining customers is a constant struggle because every F&B outlet strategises promotions, new food items, and location expansion. A successful business is not contingent on a sole element, and a large majority of businesses fail, rendering equipment to waste while still in very usable condition,” Lim said.

Filling A Need

Café Karung Guni fulfils F&B needs in the highly volatile landscape. It takes in equipment from failed businesses and sells it to the next wave having a go at it. The newcomers can save as much as 50% of the cost of buying new equipment when they pick up secondhand equipment from Cafe Karung Guni.

This business proved fruitful and Lim sold off Nook Café.

“I had to make a decision. Recycling is a universal need and I saw a scalable market for equipment recycling. I noticed the boom of young people in the café scene, and predicted the downfall of cafes in the saturated market,” Lim said.

She faced difficulty convincing customers in the early stages, due to a lack of expertise. Lim fixed this with a hands-on approach from the beginning, such as visiting warehouses, learning from chefs about equipment price points, taking part in logistics discussions, getting on lorries to move goods, and speaking to operators to understand every step of the process.

“After a while I gained the technical language,” Lim said.

“It takes persistence and courage for women to dare and venture into a business like this, and I made sure I was open-minded enough to embrace every change.”

What originated as a spark has grown into something useful for the majority of F&B operators, from the big players to small individual outlets. One by one, big players in the market were convinced to buy and sell from Café Karung Guni.

Currently, Lim works with 60% of F&B outlets in Singapore.

“That’s when you know you have something essential for the market,” Lim said.

“Business is about solving people’s problems, something I am proud to have established by being part of a constant learning experience.”