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honestbee suspends habitat business as traffic dives 60%

honestbee suspends habitat business as traffic dives 60%

Source: Business Times
Article Date: 11 Feb 2020
Author: Claudia Chong

honestbee had been operating habitat, a tech-enabled supermarket and dine-in concept located in Pasir Panjang, while the company undergoes a court-supervised restructuring process.

honestbee has temporarily suspended operations at its supermarket, habitat by honestbee.

This follows a 60 per cent dive in walk-in traffic there and Singapore raising the risk assessment for the novel coronavirus to Orange, the second-highest level.

The suspension, which kicked in on Monday, will last till Feb 23 and may be extended if necessary, said honestbee. The fall in traffic was most noticeable in habitat's weekday dinner crowd that comprises mostly workers in the vicinity.

honestbee had been operating habitat, a tech-enabled supermarket and dine-in concept located in Pasir Panjang, while the company undergoes a court-supervised restructuring process.

habitat is crucial to the troubled startup's revamp, The Business Times understands. Under honestbee's proposed scheme of arrangement, some 800 creditors will be repaid 3 per cent of what they are owed in cash. The remaining 97 per cent will be repaid via the issuance of shares in a new Singapore entity that will own honestbee's assets, sources told BT.

The deal will be funded by a US$7 million investment from FLK Holdings, a US entity owned by former honestbee chairman Brian Koo and his venture firm, Formation Group. The injection of fresh funds is conditional upon honestbee retaining tenancy at the current habitat premises, among other factors, BT understands.

While operations at habitat are suspended, honestbee will continue to provide its online grocery delivery service to customers. The startup told BT that online orders for groceries had increased by three times following the updated risk assessment level for the coronavirus on Feb 7.

The elevation of the risk level to Orange had sparked panic buying across Singapore, with shoppers clearing supermarket shelves of everyday items such as rice, instant noodles and toilet paper.

It prompted NTUC FairPrice to impose purchase limits on paper products, rice, instant noodles and vegetables.

Asked why walk-ins to habitat have fallen despite the surge in shoppers at supermarkets across Singapore, an honestbee spokesperson said a large percentage of the product offerings in habitat are unique. The store carries many Asian brands that are exclusive to habitat, and not usually found in other supermarkets.

"Having said that, majority of the essential items that we do have in stock have been bought by customers over the weekend or have been fulfilled as part of our online grocery service," said the spokesperson.

Source: Business Times © Singapore Press Holdings Ltd. Permission required for reproduction.

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