CEO Series

Korean Inspired, But S'pore Made: How 4Fingers Clawed Its Way To The Top And Earned $45M In 2018

  • 4Fingers is a Singapore fried chicken chain that started off as a single, standing-only space in ION Orchard mall in 2009
  • Fast forward to today, 4Fingers has over 30 outlets across Singapore, Malaysia, Indonesia, Thailand and Australia
  • The firm has also grown to become Singapore’s second largest chicken brand after KFC, which earned $45 million annual revenue in 2018

When people walk past 4Fingers Crispy Chicken, many think that the Korean fried chicken joint hails from Korea, or even New York, judging from its grungy, underground interior like graffiti walls and subway signs.

What many do not know is that 4Fingers is actually a homegrown brand.

4Fingers’ four founders were actually “big foodies”, and they had their first taste of Korean fried chicken in New York’s Koreatown.

“The flavours and texture were unlike anything they’d ever tasted, and they believed that this style of chicken could be a fantastic [business] opportunity. They came back to Singapore with their new idea and opened 4Fingers’ first store in 2009,” said 4Fingers CEO Dave Acton.

“The name 4Fingers is a nod to how one would typically need four fingers to eat a chicken wing,” he added.

4fingers outlet
Interior of 4Fingers’ outlet / Image Credit: Asylum

Its first outlet at ION Orchard started off as a single, standing-only space; and there were days when its sales would rack up to just a few hundred dollars.

It was only when the mall’s basement — where the outlet is located at — started seeing higher footfall, did the brand started gaining traction.

When its neighbouring store closed down in 2012, the founders took advantage of this opportunity to expand the outlet and turn it into a dine-in eatery.

It took them almost five years to grow beyond that first store, and now 4Fingers has grown into Singapore’s second largest chicken brand after KFC.

From $2M To $30M In Just 4 Years 

In 2013, 4Fingers only raked in an annual revenue of $2 million.

“The brand had immense potential, but its growth was restricted mainly due to funding struggles,” said Acton. “The founders decided to go their separate ways, and passed the reins over to a new owner who could secure investment.”

After 4Fingers got acquired by ex-investment banker Vijay Sethu, the firm finally had the stability and funding to grow, which allowed it to go on an expansion spree.

Within four years, the brand opened a total of 21 outlets, including its first overseas outlet in Kuala Lumpur, Malaysia.

These happened under the stewardship of former CEO Steen Puggaard, who also helped grow the company’s revenue to $30 million.

Not a very surprising achievement, considering that he has over 20 years of experience in the F&B industry and has worked with fast food giants such as McDonald’s and Burger King previously.

One thing worth noting: it wasn’t his first rodeo with 4Fingers. Puggaard was previously a director in the company, but got fired because he refused to “breach his fiduciary duties“.

But when he rejoined the company in 2014, Puggaard effectively helped to scale the business and brought it to markets beyond Singapore.

Spreading Its Wings Beyond S’pore

Unlike other local companies which tend to look at expanding in emerging markets like Southeast Asia, 4Fingers is tackling more mature markets instead like the United States.

“While there is substantial headroom to grow in Singapore, new outlet launches are on hold due to the changing landscape of retail locally. Mall footfall is on a decline, and landlords are trying to adapt by increasing the percentage of net lettable area for F&Bs as they are now the bigger driver of foot traffic compared to retailers,” said Acton.

Leasing out to more F&Bs results in greater competition, yet tenants are still expected to maintain profit levels while being charged the same — or more — amount of rent. While we wait for competition and the expectations for tenants to level out, we have instead chosen to focus our efforts overseas, with our maiden US outlet to open in Los Angeles, California, in 2019, and a couple more in Australia.

Currently, 4Fingers has presence in Singapore, Malaysia, Indonesia, Thailand and Australia, totalling to over 30 outlets internationally. In Singapore alone, it has 13 outlets islandwide.

“In our world domination plan, we are focusing a lot more on mature western markets where people are fed up and unhappy with the old entrenched brands,” Puggaard told Forbes.

As a young, relatively new brand, we had the advantage and freedom of moulding ourselves to match current trends and consumers’ demands. This is especially true in a market so saturated with established food chains. We are constantly on the lookout for ways to disrupt the status quo as opposed to blending into the wallpaper.

This explains its “rebellious” and disruptive nature. Unlike big brands, 4Fingers want to rock the boat and do things differently.

4fingers fried chicken
4Fingers’ signature crispy chicken / Image Credit: 4Fingers

Foregoing the mass-produced, processed fast food model, 4Fingers uses only fresh chicken, with no artificial flavourings and preservatives.

Additionally, its signature soy sauce — which is hand-painted on every piece of chicken — originates from a family-owned business in Penang, Malaysia. The sauce is fermented for five months, causing it to separate into layers, but they only extract the bottom layer as it’s the most flavourful.

Many mass manufacturers have approached them to make the sauce, but 4Fingers has rejected them because it feels that they won’t be able to capture the same essence.

Revenue Soared To $45M In 2018

It’s clear that 4Fingers prides itself on serving quality food, which explains the constant crowd at its outlets.

Catering to this demand, 4Fingers even ventured into the food delivery business. The delivery revenue for its outlets that offer home delivery can be “as high as 30 per cent“, which signals a clear demand from customers who enjoy the convenience.

However, selling through these food delivery companies meant little to no profit margin for 4Fingers after factoring in the hefty commission fees.

Nonetheless, the company’s annual revenue has soared to $45 million in 2018.

And with its recent acquisition of a 50% stake in Australia-based Mad Mex, the company projects systemwide revenues of over $120 million this year.

dave acton
4Fingers CEO Dave Acton / Image Credit: 4Fingers

My vision for 4Fingers is to remain ahead of the curve to grow a sustainable business that can be scaled up globally. It was the entrepreneurial mindset that took us from one store to 25, but a different frame of mind is required to take the business to 100 stores and beyond.

“We are proud to be a homegrown Singaporean brand and hope to be a truly global brand one day taking on the established giants. It’s an immensely challenging target in an ultra competitive sector, but we are very passionate and dedicated towards achieving this goal,” said Acton.

Featured Image Credit: Inside Retail Asia / 4Fingers

 

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