TIMBRE INNOVATIVE SOLUTIONS
Innovations for Tomorrow Food Services
The global pandemic of COVID 19 has cast an unprecedented speed of change onto how we go about our daily life with social distancing, mask-wearing, and personal hygiene. This changing consumer behavior and stringent government regulations have created a huge impact on how a business operates. Food service businesses are one of the hardest-hit industries witnessing large scale business closure and layoffs due to depressing demand, additional investment for regulatory compliance, and limitation of dine-in, which simply makes the business model not viable anymore. On the other hand, digital food delivery services have risen to the occasion and seized on the opportunity by providing the last mile food delivery services between food outlets and consumers.
The problem with the food delivery services is that it is confined to the operation hours of the restaurant, the concern on the food delivery hygiene practice, and the affordability of the food. The vending machine which is traditionally placed near the customer needing it, serving snacks and drinks is not able to address the working person's need for protein, calories, fiber through a proper meal. This thus presents itself as an opportunity for an innovative solution to address this demand.
Timbre Smart Vending is the solution to address this gap. Timbre’s unique vending machines with build-in microwave helps to serve hot tasty healthy meals 24 hours without any dependencies on the food outlet and kitchen. This self-service food service solution can be deployed anywhere near the demand population such as 24 hours call centers, hospitals, campus hostels, care centers and many more, serving a huge variety of chilled frozen meal from local delights, western, desserts to sushi, vegetarian and even specially designed healthy lifestyle meals.
The core values of our smart vending concept are Convenient, Safety, Assurance and Tasty. Each of this represent a very important aspect of our goals in food services which is also what our consumers today cares about. These 4 core values are our guiding principles and our in-house Research and Development goal is to better perfect our solution so we can deliver these values to our customers.
There are a few factors in our vending machine design that caters to the core value of Convenient. The most important factor is our vending machine has a built-in microwave and chilled storage that can reheat a meal in less than a minute. It also supports total cashless payments as well as innovative touchless purchase for hygiene concerns which is a novel online to offline order at the tip of the finger.
Food safety is the most important aspect when it comes to heating meals because of the demand for stringent cold chain integrity to ensure meals are delivered within the safe time zone, in a cold chain proof insulation box with temperature monitoring. The build-in microwave assures that no other items can be reheated in the oven except those that are refilled by the company thereby providing confidence to the consumer on hygiene and halal assurance.
As part of the food safety assurance program, Timbre only works with ready to eat meal (RTE) manufacturers who have attained Halal certification as well as are HACCP certified. All the meals come in the original sealed packaging and are loaded onto a microwave container box for ease of handling.
Ultimately, Timbre Smart Vending is akin to a mobile food kiosk, and the food offering is the most important aspect of this business model. In order to meet the various food safety criteria, Timbre vending is compatible with the Ready to Eat meal packaging. A Ready to Eat (RTE) meal is basically a meal that has been thoroughly cooked, assembled into a microwaveable package, sealed before going through a blast freezer process to rapidly bring the temperature to negative 20 deg Celcius for prolonged storage. RTE meal concept has been around for some time and globally the RTE demand is on the rise because of its convenience and this has attracted many food businesses to venture into this.
Timbre smart vending machine is a purposed build smart vending machine. It has a unique build-in industrial high-power microwave and a 60 pax capacity chilled compartment. The machine supports the cashless transaction and is also IoT enabled whereby it is connected to the monitoring backend via a 4G network. It can monitor the temperature, the inventory level, and also control the 32” LCD signage.
Timbre will perform preventative maintenance as well as service and repair with our maintenance crew ensuring the machines are always up.
Timbre IS IR4 Platform
One of the competitive edges for Timbre is our in-house Timbre IS IR4 platform that connects and monitors all the system components. This is a very crucial platform as a RTE meal is a temperature-sensitive product and requires tight cold chain integrity as well as a seamless replenish operation for each of the vending machines in the market. The picture below depicts the major functions of the business model that is supported by the Timbre IS platform.
Ready to Eat Meal Offerings
The origin of the modern ready to eat meal goes back to 1950s America and a food company called Swansons. Left with a huge surplus of turkey after Thanksgiving in 1953, Swansons hit upon the idea of packaging it up with all the other components of the traditional American dinner. But the stroke of genius was packing it all into the aluminum trays used to serve food by airlines. The containers acted as both baking trays to cook the frozen meal and a plate off which to eat it.
In Malaysia and South East Asia, RTE meals are gaining momentum and popularity among youngsters and busy couples who have no time to cook. This can be seen at all the major convenience store chains which now have some type of RTE meals on offer. The huge demand for RTE meals has in turn attracted more local food manufacturers to venture into RTE meals and are creating varieties of local flavors.
Timbre has the privilege of working with some of the most renowned and innovative local food manufacturers in coming up with new products designed to meet various market demands including vegetarian and low GI meals for diabetic patients.
We have 3 types of customers;
Consumer who purchases the food from our vending machines
A Business partner who purchases the machines from us and signs up for an operating arrangement that enables us to provide food, replenishment, machine maintenance, and backend monitoring, traceability and warehousing system.
Advertiser who rents the airtime from our vending LCD screen.
Timbre will be operating the smart vending network under the brand name of “Snatch a Bite” in which Timbre will fund the machine cost as well as operate the replenishment which is called the “In-house Snatch a Bite Vending Network”. The second model is the Strategic partner OEM arrangement where a potential customer intends to have its branding on the machine and having a requirement of more than 5 machines. Under this program, the OEM customer will enter into a 5 years auto-renewable operation supply and service agreement where Timbre will continue to supply food, replenishment, and service maintenance. A third model is for the individual investor who procures the machine to have the machine operate under Timbre’s Snatch a Bite brand. The investor will enter into a 5 years auto-renewable operation supply and service agreement whereby Timbre will continue to supply food, replenishment, and service maintenance. The following table illustrates the 3 business models.
Timbre focuses on the captive market where the food services are limited by choice and operating hours.
The ready to eat meal is conventionally available at convenient stores, petrol kiosks and hypermarkets. The consumer has to go to the store, which is typically 15 to 30 minutes of traveling time. It is therefore dependent on whether the person has suitable transport at hand and further there is no guarantee that the meal will be available as these are hot selling items.
The other more popular last mile solution is the online food delivery services where the user will place an order on a popular platform and the product is delivered by a rider. This service solves the last mile solution effectively but it comes with some disadvantages, most notably from food temperature which is a typical food safety concern, the hygiene factor of the carrying box, and lastly, it is extremely subject to the operation hours of the kitchen or food outlet concerned.
Timbre smart vending resolves all the above issues as the vending machine can be located within walking distance, serving 24 hours a day, 7 days. The build-in microwave and chilled storage ensure food is safe, stored in a chilled condition, and only reheated on demand, as well as halal assured. Using our smart mobile app, users can pre-book the meal from the vending machine.
Below is a table illustrating the various competitive parameters among the four models of food services.
In summary, Timbre smart vending has the following unique selling points as illustrated in the figure below.
Timbre Smart Vending Unique Offerings
Go to Market Strategy
The food service market has been traditionally a labor intensive industry in which aside from food quality, services also play a major role. This is especially true for a food service business that has a kitchen serving a hot meal on the spot.
In order for Timbre to penetrate this market, our marketing strategy embarked on a two prong approach where the first strategy is to gain exposure for the Timbre brand name as well as educating the market on the impact of Industrial 4.0 in revolutionizing food service industry.
The second strategy is to identify key investment customers as well as key Ready to Eat meal suppliers. In this approach, we develop our OEM model where customers who purchase machines in volume and have potential large sites can put on their brand and sign up an operation and supply agreement with Timbre in operating their network of machines.
Timbre has since taken part in the Café and Bakery show 2018 in PWTC, showcasing the initial concept of the hot food vending machine. The response has been overwhelming for a vending machine that can provide instant hot meals. The show has given us very good market feedback to further develop our business model, solicit potential sites, and captured some 60 interest business entities, potential investors as well as potential sites for deployment.
In 2019, Timbre participated in the Malaysian Dietitian Association Annual Event at the Hotel Istana. During the event, the Honorary Guest Dato Dr.Chong Chee Kheong ,Deputy Director General of Ministry of Health Malaysia and Professor Winnie, President of the Malaysian Dietitian Association visited our booth and were impressed with Timbre’s healthy lifestyle concept hot food vending machines. This event allowed us to market our solutions and services to the health care service industry in particular the hospital sites which are one of our main target deployments.
On strategy 2, Timbre has engaged key reputable establishments such as major universities and prominent investor groups to our office to demonstrate the machine and explain our healthy lifestyle vending concepts. This approach resulted in potential OEM arrangements and securing of major hospital sites.
Timbre has earmarked a potential deployment of 150 machines as our key business goal. This figure is a conservative figure in view of the large potential sites available, in particular 24 hours call service centers, hospitals, university campuses as well as factories.
The revenue is derived based on the assumption that each machine is able to serve 80 meals per day with an average price of RM8.50 per meal.
The potential success of Timbre business model is high due to the following factors
Low cost of entry – the cost of the machine is much lower as compared to setting up a convenient store
Scalability – the machine deployment takes only a day whereas a convenience store will take weeks to renovate. There is also the fact that our machines are unmanned compared to the need for hiring for the convenience store.
Proximity– Timbre smart vending machines can be deployed very near to the target consumer base whereas the convenience store has to be in a shop lot and require a much larger space.
Menu varieties – Timbre is able to offer multiple carefully selected menu catering for a wide range of audiences from Local delights, Western to Japanese, or even dessert. This helps us to keep attracting our loyal customer base and offers a rebate on the frequency of consumption with our in-house mobile app.
Mobility – the machines can be easily redeployed to other sites in order to meet our target sales with minimal cost. This is not the case for convenient store investment where the sunken cost is much higher.
Fig 13 . 5 years business projection
The snapshot above shows that our target machines deployment on a five-year planning basis with the potential revenue. We expect the first year of operation to be in the red due to the various CAPEX investments, operating expenditures in personnel requisitions, as well as the time taken to ramp up the sales to the target volume and average selling price of each machine.
In the second year onwards, we foresee we will start to make a small profit on the back of rising volume from our 1st 30 machines deployments as well as the addition of new machines. This trend would continue as we further add the machines due to the fact that there are many underserves sites that require our machines.
As part of the business development strategy, Timbre has set a vision that we will spend our initial years in developing the Malaysian market. Additionally, we have also set our sights on the global stage where the demand for such machines is much higher. Today we are embarking on our initial fundraising series A in which we will use the fund to commercialize and speed up our deployment. We foresee that not too long in the future, we will be expanding onto another stage where we may go public or go through series B funding to help us expand to the overseas markets as well as to further develop our business intelligence with the amount of big data we gather from the initial years of operation. Our valuation as a company will grow due to the following factors that make us different from any other similar vending startup:
We model our business growth on food supplies and operation service
We have intellectual properties on big data which allows us to further analyze our market in bettering our services and consumer behavior
We develop and license our Timbre IR4.0 platform for our own use as well as our OEM customer
We develop our machine software and our market-leading unique contact-free purchase model on smart vending machines
The main purpose of the fundraising is to gather the necessary capital for commercialization. The RM1.2 Million raised will be used for the first 30 machine procurement, cold room and freezer truck which will be under the category of capital expenditure, a further RM250k will be used for the continued development of the Timbre IR4.0 platform and lastly, the remaining RM397k will be utilized for working capital for hiring the necessary operation staff.
The market of RTE hot food vending is a global demand spurred by the tech-savvy younger generation as well as the changing working culture environment. The COVID 19 pandemic has also influenced greatly the habit of eating out in restaurants amid hygiene concerns. Timbre strongly believes this huge global demand will potentially allow us to grow the business beyond our borders.
Riding on the Malaysia Halal brand, Timbre strives to work with our local RTE meal providers to be the global player in the Halal Hot Meal Vending market. While we set our vision on the global stage, we will remain practical in our approach where we will spend the initial years in perfecting our operations and expanding our business beyond the Klang Valley. At the same time, we will be actively pursuing our neighboring ASEAN market as a start where the demand for Halal food is very strong. One of the key markets is in Thailand, the Philippines and Indonesia. Our ultimate goal is to be the global player on the growing Halal food market which is expected to reach USD739.59 Billion by 2025 according to one of the research house reports.
Timbre is a 100% local owned startup founded by a group of technopreneurs and F&B business operators passionate in transforming food services to be efficient, safe, compliance assurance driven by Industrial 4,0 principles with our inhouse IR4.0 Digital Platform that covers machine remote management, food traceability, cold chain management, mobile loyalty, and digital advertisement.
Brian Lew, Managing Director
A trained electrical and electronics engineer who graduated from Nanyang Technological University, Brian has been involved in electronics and IT for the past 25 years having a career spanning research and development, sales and marketing, business operation, and manufacturing. He is part of the pioneer team that developed the MyKAD and Electronic Passport under IRIS Corporation. He also plays an instrumental role in developing the National Edible Nest Swiftlet Track and Trace Database and System. Brian is also currently the Director of GD Innovations, a technology startup that specializes in RFID and supply chain traceability solutions.
Bernard Gerald Reincastle, Chief Executive Officer
Bernard brings with him more than 40 years of experience in F&B, food catering services, business network local and international partners, food factories, and ingredient suppliers. One of his past assignments is as the Head of F&B at Prince Court Hospital where he lead the hospital in achieving the prestigious JCI accreditations. Bernard is a well know industrial consultant in the local and international F&B industry and founding President of the Malaysian Association of Coffee and Tea Innovations, Vice President of Malaysia Tuna Association.
Ng Kar Chai, Technical Director
Graduated as an electrical and electronic engineer, Kar Chai has been involved in software and technology development for the past 22 years serving the various public listed companies as well as the university. He is the chief architect of the vending system and its backend design. He is the key designer for the National Edible Nest Swiftlet Track and Trace Database and System.
Jimmy Loong, Business Development Director
Jimmy is a well-known industry figure in the retail F&B solution, one of the early pioneers in deploying the intelligence point of the sales system in early 2000. He is also the speaker on the property certification training for Malaysia Shopping Mall Association. Jimmy will be responsible for soliciting potential sites for our vending network.
Other key team members
Timbre organization is designed around 6 key departments where the Operation Department and Technical Development department carries the major functions in the business. The Finance and Human Resources department report directly to the managing director to serve as a check and balance. The Chief Executive Officer manages and operates the business according to the plan and budget. The Managing Director oversees the operation as well as provides guidance and leadership in areas such as technology development, funding needs and strategic collaborations.
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MOU between Timbre and RFX Innovative on OEM arrangement
RFX Innovative Sdn Bhd (RFX), a local incorporated bumiputra company specialised in industrial 4,0 solution marketing has entered into a Memorandum of Understanding with Timbre Innovative Solution on 17 Sept 2020 to acquire minimum 5 smart vending machines with OEM RFX brand from Timbre Innovative. Under the arrangement, Timbre will provide RTE meals and operation services to faciliate the vending machine replenishment, epayment, backend services and maintenance. RFX will market the RFX branded smart hot food vending solution to domestic market under RFX brand.
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