FoodXervices bet S$50M on a new HQ weeks before COVID — it never recovered (interview)

In an interview with The Business Times, co-founder Nichol Ng recounted how FoodXervices — rooted in the Ng Chye Mong trading business her grandfather started in 1934 — went from under S$2M in sales when she and brother Nicholas joined in 2002 to a record S$65M in FY2020, serving 5,000 customers. That gave the siblings confidence to complete Xpace in January 2020: a S$50M, 250,000-square-foot headquarters at Pandan Loop, five times their old warehouse, funded 80 per cent by a bank loan and meant to double as co-working space with central kitchens for F&B players.

The pandemic struck weeks later. 'At that point, it was just an empty building,' Ng said. Electricity and logistics overheads alone ran close to S$500,000 a month, about what revenue had fallen to, and the co-working plans fell through. Then the banks pulled the trade lines the business ran on — food distributors gave customers 90 days to pay but had 30 days with suppliers — 'when the banks stopped the trade lines, it stopped our blood flow'. Revenue declined every year after FY2020, with losses in every year except FY2021.

The siblings fought for six years: an asset-light shift, Ng selling her matrimonial home to inject proceeds, a 2023 restructuring backed by a 'white knight' lender, the 2024 sale of Xpace to an Australian fund that only repaid the bank — leaving FoodXervices renting its own building for about S$300,000 a month. In March 2026 the landlord rejected a potential new investor and the white knight pulled funding, placing the company in receivership; in April the siblings put FoodXervices into voluntary liquidation, closing a 92-year family business.

Revenue fell from a record S$65M (FY2020) to S$21.4M (FY2024); Xpace sold for only enough to repay the bank; 50 staff laid off with some April salaries unpaid.

The bet was sized on five golden years of cheap credit — 80 per cent debt on a building five times the old warehouse, finished right at the top of the cycle.

The top line was spectacular but the margins were not: the company largely broke even for years, so it had no cushion when COVID removed the revenue.

A working-capital model dependent on bank trade lines collapsed the moment its creditor told it to find a buyer and other banks cut facilities.

The rescue itself added a fixed cost — S$300,000 a month renting back the building it had just sold — that outlasted the funding propping it up.

Expand on margins and retained earnings, not cheap credit: a downturn collects on the loan first, and break-even growth has no cushion to collect from.

The Food Bank Singapore, the siblings' 2012 charity, is a separate entity and unaffected. Ng says the family will be back in a different shape — 'we proved that when we pivoted from Ng Chye Mong to FoodXervices' — and that her next venture will carry higher gross profit and easier margins than a distribution business she now admits was obsessed with top-line growth.