The spike in COVID-19 community cases has led to a darker reality for nightlife outlets in Singapore, as the Government decided to put on hold its pilot programme — that allows a limited number of nightlife outlets to reopen — in favour of controlling local transmission of the virus.
Teo Heng KTV, in particular, has announced on Thursday (21 January) that it will be “leaving the industry for good” to preserve resources and cut looses, hoping that the Government would help to ease the outstanding cost incurred.
The local karaoke chain has been around for 31 years since it was first founded in 1989 by Jackson Teo, who was selling karaoke sound systems at Katong Shopping Centre.
Mr Jackson had previously shared that the company is expected to incur up to S$500,000 losses for a month-long closure, as reported by Vulcan Post.
All 120 staff members of Teo Heng KTV were paid full salaries for the first six months of closure, despite the losses in revenue.
Their pay subsequently reduced 50 per cent from last October which was suggested by the staff members themselves, in the hope to alleviate the company’s financial burden.
To generate income, the karaoke chain continued to sell sound systems – which is their core business – even though the sales have dipped “at least 50 per cent” amid the pandemic.
Teo Heng also shared to CNA Insider last year that it had spent more than S$100,000 to install anti-virus fogging machine at every outlet, and spend at least S$6,500 monthly to keep the rooms clean and disinfected.
Jean Teo, director of Teo Heng KTV, had previously told Vulcan Post that the company had about S$1.5 million in reserves to keep them afloat.
“We really underestimated this time, and so far we have spent over S$1 million. So if COVID-19 drags on, I don’t know if we can survive for another few months,” she noted.
Govt introduced pilot programme to allow limited number of nightlife outlets to reopen
On 6 November last year, the Ministry of Trade and Industry (MTI) and the Ministry of Home Affairs (MHA) announced that nightlife industry will be allowed to reopen under a pilot programme in 2021.
Under this programme, clubbing and karaoke singing will be open only to local residents and those with work passes, who must show proof of having taken a COVID-19 test in the last 24 hours before they can enter a joint.
Clubs will have a capacity limit of up to 100 people, with separate dancing and dining zones that can hold 50 people each. Customers will have to wear face masks at the dance floor and stay 2m apart from other groups, indicated by floor markings and physical barriers.
Karaoke establishments, on the other hand, will be allowed to host groups of up to five people within enclosed rooms that will have to be cleaned, disinfected and aired for 15 minutes between groups.
No hosts will be allowed to be deployed to interact with customers in both types of venues, as a measure to reduce interactions.
Teo Heng, however, decided not to apply for reopening under the pilot programme.
It noted that the cost involved would further deplete their resources, given that every customer would be required to undergo a swab test a day before entering the premises, as reported by Mothership.
Teo Heng added that such a requirement would only increase the cost for customers, as well as operators if the latter were to pay part of the cost.
The karaoke chain decided to pivot to other businesses instead, planning to turn its remaining outlets into working or gathering spaces equipped with free Wi-Fi.
Teo Heng eventually applied for the pilot reopening option in January, as reported by Mothership.
Pilot programme for nightlife outlets deferred by Govt amid spike in community cases
MTI and MHA announced on Tuesday (19 January) that the pilot programme will be deferred until further notice due to the recent spike in community cases.
It is uncertain when the pilot may be able to commence, given the dynamic public health situation. Agencies have said that they will review the commencement of the pilots at a suitable juncture.
Ms Teo told CNA yesterday that the Government’s decision has caused the landlords to worry as the business has not been making any revenue since the circuit breaker was imposed last year.
She added that the landlords were considering to pre-terminate Teo Heng’s lease, in which the company is ought to pay the outstanding rental cost.
“We are seeking help from the Government bodies to see how much they can actually render their help to keep the damage to the minimum,” said Ms Teo.
Teo Heng noted that it will be applying for a Government scheme that helps small businesses renegotiate contracts.
“They [the Government] also cannot tell us when we are able to reopen so we have no choice. We really have to leave the industry for good,” Ms Teo stressed.
Teo Heng KTV: Exit is only temporary
Not long after the closure of Teo Heng was reported, the karaoke chain made a clarification that its exit is only a “temporary move”.
“Dear supporters, TeoHeng KTV Studio will not be closing all the outlet as [announced] previously. We will strive on till further notices. Our Teo Heng Trading will still be in operation,” it stated on Instagram last night.
Ms Teo told Mothership that the company will try to hold on to two outlets located at Ci Yuan Community Club and Tampines West Community Club respectively, as she noted that the rents for both outlets are more manageable.
She added that Teo Heng will be negotiating with the landlords for other outlets and they hope that the People’s Association will provide support to the karaoke chain.