Details on NewcrestImage’s investment in TiffinLabs

Hotel investors are opening their minds and recognizing that there are opportunities to generate profit in adjacent hospitality spaces. One such hotel owner is Dallas-based NewcrestImage, which last week became the second biggest shareholder in TiffinLabs, a Singapore-based food technology company that is aggressively expanding its “ghost kitchen” food delivery-focused virtual restaurant brands to the U.S. hospitality industry.  NewcrestImage would not disclose how much it invested or its expected return.

TiffinLabs, which has introduced numerous virtual brands across Singapore and Malaysia since its founding in 2020, started its expansion into the U.S. in Dallas in 2021 and now operates in multiple additional cities, including Chicago, Detroit, Knoxville and Charlotte. By 2023, it expects to have 1,000 digital storefronts globally and to be operating in 30 U.S. cities.

In addition, on Tuesday, TiffinLabs launched a US$2 million subsidy program to underwrite local restaurant and hotel owners who want to introduce the virtual restaurant brands at their properties. Specifically, the TiffinLabs fund will pay for all onboarding technology hardware and monthly fees for the first year of the operator’s partnership, including activation support fees by food delivery platforms.  Also covered for qualified operators will be all virtual and on-site training as part of set-up and start-up.

Hotel properties currently using the TiffinLabs concept operate under such brands as Hilton Garden Inn, Doubletree, Hyatt Place, AC Hotels, Courtyard by Marriott and Best Western. Operating partners in the U.S. include HP Hotels, PM Hotel Group, Murphy Asset Management, Aimbridge Hospitality and NewcrestImage.

“As hoteliers at our core, we look to fully integrate the solution throughout the hotel’s operations while limiting the level of experience in the F&B team,” Mital Patel, managing partner of NewcrestImage and now board member for TiffinLabs told HOTELS.  “So, our brands are integrated fully into in-room dining/pick-up, on-premises restaurants and even suite shops as well as delivery and pick up. And, our proprietary technology helps make this simple, easy and currently no upfront costs.”

Shaun Smithson (left), Tiffin Labs co-founder and president of U.S. operations, is part of the culinary team who develop virtual restaurant brands for operating partners

Patel added that many TiffinLabs operators have achieved dramatically higher revenues and better margins, such as four-fold increases in delivery and on-premises income, and 30% increases in overall profit.

Here are more details from Patel about how TiffinLabs works with hotel companies:

What does a typical hotel have to invest to get started and again what is the expected ROI? No initial investment other than inventory – the only cost would be any additional inventory required to launch the virtual brands.

Does TiffinLabs charge a fee for installation, or does it partner and do a revenue share with hotel operators? There are no onboarding fees. So, the only costs to activate and support are the inventory and then a revenue share based on local delivery and on-premise sales.

What are initial results from TiffinLabs hotel partnerships? So far, results are strong with the support of the property owners and property leadership. In one hotel, TiffinLabs is driving more than 25 additional orders per day in combined delivery and on-premises orders while working within their limited operating hours and using their optimal staffing model.

What does a typical menu look like? Menus are driven by TiffinLabs proprietary location analysis to help understand the local area and the needs of the property. It then works to align with the equipment already in place and the skill level of the property team. TiffinLabs supply chain then aligns with the property suppliers and current purchasing patterns. From there, it offers anything from healthy salads and bowls to burgers, and Indian and Asian inspired brands. One of the most popular menu items is the Phat Fingers Korean Fried Chicken – it’s in 10-plus locations so far.

How much space is required? The Tiffinlabs solution works in spaces as small as 150 square feet and with minimal equipment. It has brands that work with convection ovens and speed cooking technology, as well as full kitchens. It operates its own kitchens in other markets, and it sells as many as 12 brands in less than 250 square feet. It optimizes the supply chain and support to work with limited storage to make it even easier.