Franchise Industry Business News

More
Franchise Industry
Dolce & Gabbana introduces for the 1st time its service made to measure in Mexico and Latin America
Dolce & Gabbana is not stopping its commitment to the Mexican market and, after its recent openings in Veracruz and Mexico City, the Italian brand has presented for the 1st time in the country and Latin America its made to measure or tailor-made service. In the brand's boutique located in the Santa Fe shopping center in Mexico City, Dolce & Gabbana customers can choose from 500 types of fabrics such as silk, satin, wool or cashmere. An additional selection of 200 fabrics is available twice a year. All are produced exclusively for the firm. After the process in the store in the country's capital, the measurements are sent to Padua, Italy, where the ensign has about 70 tailors for the piece to be traced, cut and assembled and to be sent back to Mexico; this process takes between 8 and 9 weeks. Afterwards, the client will have the fitting and the buttons that were previously selected will be put on, in order to finish the process. The arrival of Dolce & Gabbana's made to measure service in Mexico, which was created in 2014, is part of an important consolidation that the firm has made in the country in the last months of the year. Recently, the company opened its first boutique in Veracruz, in El Palacio de Hierro in the Andamar shopping center, while it has opened its children's fashion pop-up store in Via Santa Fe, in Mexico City. In Mexico, the firm operates with independent stores and hand in hand with El Palacio de Hierro in Polanco, Perisur, Guadalajara, Monterrey, Queretaro, Masaryk, Via Santa Fe, Punta Norte, in Mexico City, and Fashion Harbour in Cancun. Dolce & Gabbana, whose founders recently declared that they want the company to remain in the hands of the Dolce family, employs 5500 people worldwide. In financial terms, in fiscal year 2018/2019, the firm recorded an increase of 4.6% in its turnover to 1.35 billion Euros.   Source:https://www.mexicanist.com/
Franchise Industry
Chipotle's New Digital-friendly Restaurant Design
Chipotle Mexican Grill is piloting new store features to reduce friction and increase convenience for customers and drivers picking up digital orders.  The fast-casual chain is testing its new design in four new restaurants of the following types: an urban storefront, a standalone restaurant with a drive-thru “Chipotlane,” and endcap unit with a “Chipotlane.”  The pilot stores are in Chicago, Cincinnati, and two locations in Phoenix.  Additionally, the new restaurant design will be trialed in two retrofits in Newport Beach and San Diego, Calif. As part of its stage gate process, Chipotle will assess the performance of each restaurant for transactions, guest feedback, and ability to incorporate future menu innovations, among other metrics, before determining which design will roll out nationally. With Chipotle's digital business increasing in size to $1 billion dollars, new in-restaurant features such as walk-up windows and premium placement for digital built in pick-up portals are designed to allow customers to receive their food more efficiently.  Other features include open views and front row seating to provide direct lines of sight into the kitchen.  The openness of this design will aim to increase communication and foster a sense of community with the restaurants.  Additionally, bottled beverages will be more accessible with a customer-facing reach-in cooler built into the serving line. "By better suiting our restaurants to accommodate the digital business, we're able to finalize orders more effectively and provide a better overall experience for our guests," said Curt Garner, CTO, Chipotle. "While we are staying true to Chipotle's heritage, we are also excited to integrate new, innovative physical features into the restaurant that complement our growing digital business," said Tabassum Zalotrawala, chief development officer of Chipotle. "Our eco-friendly, natural aesthetic and locally sourced approach to this design builds on our strong brand values and mission of cultivating a better world." Chipotle Mexican Grill had over 2,500 restaurants as of Sept. 30, 2019, in the United States, Canada, the United Kingdom, France and Germany, and owns and operates all its restaurants.   Source:https://chainstoreage.com/check-out-chipotles-new-digital-friendly-restaurant-design
Franchise Industry
Taiwanese Franchising Brands Yielded Fruitful Results in the Franchising & Licensing Asia (FLAsia) 2019
With the support of the Bureau of Foreign Trade, Ministry of Economic Affairs, the Taiwan External Trade Development Council (TAITRA) gathered 11 Taiwanese Franchising brands to participate in the 14th Franchising and Licensing Asia – Taiwanese Franchising Pavilion from October 24 to 26, 2019. This year, the Taiwan Pavilion focused on Taiwanese classic food service sector, covering food ingredient bubble tea, snow ice, breakfast chains, innovative snacks and flagship croissant. Moreover, Taiwanese classic spicy hot pot, elderly assistive device and environmentally friendly beverage bag companies also exhibit in this exhibition for the first time. Buyers approached the Taiwanese franchising brand with open arms. For example, Singapore local groups discussed cooperation with OCOCO International Co., Ltd. Ning Chi Spicy Hot Pot introduced its products to South East Asia for the first time, and its hot pot with spice and Chinese herbs was welcomed by the locals. Red Sun Tea Shop and Indonesian franchising agents signed a Letter of Intent. Although HAZUKIDO already has a general agent for its croissant in Singapore, it also attracted local buyers to discuss franchising cooperation.     Singapore is an essential market for franchising brands to enter ASEAN. It is a springboard for Taiwanese franchising brands to effectively reach international markets, rapidly increase international exposure and greatly improve exchange and cooperation opportunities. The exhibition featured important franchising brand innovation and unique business concept for F&B, education, baking, lifestyle service, information and other industries. According to the statistics from the exhibition organizer, the 14th Franchising and Licensing Asia held in 2019 attracted more than 197 international brands from 21 countries and regions, including Singapore, Malaysia, Japan, Korea and Russia as well as about 10 thousands buyers from all over the world.
Franchise Industry
Thailand PTT Oil and Retail Business (PTTOR)brings Pearly Tea back to life
PTT Oil and Retail Business (PTTOR) is planning to relaunch and rebrand a bubble milk tea franchise under the Pearly Tea brand in early 2020 in accordance with a business plan focused on expansion of non-oil business in the near future. The Pearly Tea shop was launched in December 2014, but PTTOR suspended the business a few years later because it was considered too similar to its coffee franchise, Cafe Amazon. The Pearly Tea franchise has 25 kiosks. PTTOR operates its food and beverage business through subsidiary PTT Retail Management (PTTRM), which also operates Jiffy convenience stores. Anake Buanamuang, managing director of PTTRM, said the company is preparing an IT system, human resources and logistics to support a relaunch of Pearly Tea. "This franchisee will be another option and a smaller investment than Cafe Amazon," he said. "PTTRM has conducted research for a couple of years and found many consumers prefer milk tea to coffee, so we decided to dust off this business." The relaunch will adjust the formula for the milk tea to be healthier, with bio-sweeteners and new toppings, Mr Anake said. The shop will be redesigned from a small kiosk at PTT petrol stations to a stand-alone shop requiring an area of 30-60 square metres. Each franchisee will be required to invest 800,000 to 1.1 million baht per shop. Cafe Amazon franchises require 2-7 million baht per shop. PTTOR plans to expand the tea shop in overseas markets, similar to Cafe Amazon, which has 2,700 branches across Asia, including outlets in Oman, Singapore and Japan. "PTTOR is optimistic about the non-oil business in overseas markets, as the company has received a positive response from foreign buyers, including in new markets such as Malaysia and China," Mr Anake said. PTTOR has many non-oil businesses, such as Jiffy, Texas Chicken, Hua Seng Hong Dim Sum and Daddy Dough, in addition to PTT Lubricants and PTT Fit Auto. Some shops are at PTT's 1,835 petrol stations nationwide and 281 stations abroad, but PTTOR also operates stand-alone shops. PTTOR prioritised expansion of petrol stations in the past before increasing non-oil business such as food and beverage shops, convenience stores and car care services. Wisarn Chawalitanon, PTTOR's senior executive vice-president, said the company is considering expanding PTT Fit Auto abroad. There are 47 branches locally and 50 are to be in operation by year-end.   Source:https://www.bangkokpost.com
Franchise Industry
Restaurant, coffee chains struggle in hypercompetitive market
In closing down recently the Mon Hue restaurant chain has followed in the footsteps of many Vietnamese food and beverage businesses. Last week the 80 outlets in the traditional Vietnamese food chain closed without warning. Dozens of suppliers picketed the headquarters of the company in HCMC on October 21, claiming they had not been paid tens of billions of dong (VND1 billion = $43,000). Foreign investors, who had sunk $70 million in the chain, are suing its founder, American-Vietnamese Huy Nhat, who has been unreachable since the crisis began. The close-down of Mon Hue is by no means unprecedented in the Vietnamese food and beverages (F&B) market. Coffee and restaurant chain The KAfe closed in 2017, unable to achieve its targets. The KAfe had made headlines in 2016 after getting an infusion of $5.5 million from Hong Kong’s Cassia Investment. Founded in 2013 by a young Vietnamese, the chain seemed to be on the right track, securing prime locations in Hanoi and Ho Chi Minh City being among the first cafe chains to attract major foreign investment. But after founder and CEO Dao Chi Anh quit in October 2016, it struggled to expand and closed down six months later. Saigon Cafe was another coffee chain to close in 2017, a year after its establishment with 10 outlets in prime locations in HCMC. Its bosses said the closure was due to rising rents and intense competition in the F&B market. One common thread running through these failed businesses was rising expansion costs and a failure of revenues to catch up with them, experts said. Duong Nguyen, CEO of restaurant management solutions provider Dcorp R-Keeper Vietnam, said some F&B chains are willing to pay top dollar to secure prime locations though this does not guarantee profits. "Some hire dozens of workers for each outlet when four are enough. Opening a chain is different from opening a food stall." Mon Hue had accumulated losses of almost VND107 billion ($4.62 million) as of last year as expansion costs rose faster than revenues. Between 2016 and 2018 its revenues were almost unchanged even as costs rose by 53 percent. Marketing expert Le Phung Hao said: "If an owner keeps expanding the chain ... without being able to generate cash flow, costs will rise, debts will mount, and death will be inevitable." Duong said rapid expansion distracts owners from doing their most important job: that of managing cash flows and containing costs. Ensuring quality as a chain expands is another challenge for owners. Hao said location is not the most vital factor in a chain’s success: "Maintaining good food quality at all outlets, even if the number reaches 100, is the key." But traditional Vietnamese food is complex and difficult to standardize across a large chain, whereas other food such as BBQ have lower level of complexity and therefore easily standardized, he added. Duong said many owners erroneously think opening a chain of restaurants is similar to opening one. Once a threshold of 50 outlets is reached or major foreign investment received, professional management is imperative, he said. But Mon Hue seems to have failed to do this. Many of Mon Hue's restaurants are large with a large complement of staff, but since traditional Vietnamese food takes a long time to make, the number of customers it can serve in a day is limited. Customers used to often complain they had to wait for a long time for run-of-the-mill food. Other experts too said the rising competition in the F&B market would cause marginal players to be pushed out. Chau Tieu Ngoc, a consultant to F&B chains, said many Vietnamese chains operate without proper market research and strategy and therefore fail. "Chain owners should not imitate or copy successful international models but need to create their own models to fit with the local market and culture." The F&B market is estimated to grow at 10.9 percent a year in 2017-19 thanks to increasing incomes, according to market research firm Business Monitor International.   Source: https://e.vnexpress.net/news/business/industries/restaurant-coffee-chains-struggle-in-hypercompetitive-market-4003582.html

Franchise Industry Stories

More