Inspiring Company Stories - BreadTalk - ST
Post on 31-Dec-2016
By RACHAEL BOON
IF YOU want something done,you have to do it yourself, even ifthat means stepping back, leavingyour thriving business here andventuring into foreign fields.
That was the strategy adoptedby BreadTalk Group chairmanGeorge Quek when he took thegamble of setting up shop in Chi-na in 2003.
Mr Quek, 57, spent most of histime in the country to personallyoversee the franchise outlets, a de-cision he acknowledges was noteasy.
Letting a Singaporean managerwork alone in China while youmanage him from Singapore is dif-ficult, he added.
Mr Quek tells The StraitsTimes in Mandarin: Everyonehas made the same mistake, in-cluding me. As Singaporeans, wethink Singaporeans are good, sowe send them to China. But a man-ager manages fewer people herethan in China.
And for someone without ex-perience, who is sometimes una-ble to make a decision on thespot, it cant work unless you gothere to take charge.
Taking such a hands-on ap-proach has helped generate explo-sive growth for BreadTalk, whichnow has more than 630 outlets, in-cluding other brands in the bakerydivision like Toast Box, across 15countries, including Indonesia,Malaysia and Thailand.
Plans are in place to have 1,000outlets by the end of next year.The company employs 7,000 peo-ple.
Mr Quek could not have done itwithout raking up 20 years in thefood and beverage business first,operating businesses in Taiwan such as selling dragon beard can-dy from a pushcart Hong Kong,China and Japan, before opening aBreadTalk shop here in 2000.
There were bumps along theroad, including a painful experi-ence when a friend of Mr Queksolder brother took off with over40,000 yuan (S$8,000) fromopening an ice-cream shop he hadstarted in Shanghai in 1993.
It was tougher than being inTaiwan. When it was 5 deg C inwinter, my room temperature was0 deg C. When it was 35 deg C insummer, it was 40 deg C, hesays, referring to other tough con-ditions.
Those rough and tumble earlydays have given Mr Quek a deepknowledge of the boisterousChina market and allowed him tobe a mentor for other brandsgoing international, such as shoelabel Charles & Keith.
Charles & Keith asked me if itwas worth going to China. I saidyes, but you must personally bethere. And Charles has been therefor three years now, he notes.
If you send a manager with noprior experience in China to thecountry, you will fail. You canslowly groom a team but, in thebeginning, if you cant find some-one, you have to lead them.
Going to China will not be abed of roses, warns Mr Quek.
I went alone, without my wifeand kids, but I didnt want to staythere long-term. I spent half mytime in China, running back andforth from Singapore.
But experience makes the busi-nessman, adds the father of three,who used his in-depth, hands-onknowledge of Asia to start Bread-Talks first franchise outside Sin-gapore, in Indonesia in 2003. Itopened a shop in Shanghai laterthat same year.
He says: Were familiar withAsian cities but not so much Eu-rope and America as we haventdevoted as much resources there.
Research is a must but experi-ence is even more important.Dont show me the numbers. Ill
know the market after living therefor a while.
Mr Quek often seeks fellow en-trepreneurs with a common goalwhen it comes to franchising.
In Indonesia, he teamed upwith Mr Johnny Andrean, whohad a successful hair salon chain.
I chose him because of his eyefor fashion, creativity, people. Wehad common ideals... and hetouched me when he gave me hisword to work on BreadTalk
full-time. Today, Indonesia hasmore than 100 outlets.
The same high standards applyto those joining the company.They have to be hard-workingand willing to learn.
BreadTalks business model isstructured on having 60 per centof outlets franchised and 40 percent owned by the company.
Mr Quek, who plans to keep itthat way, says franchising allowsthe brand to expand more quickly,
but there are pros and cons.There is definitely huge merit
in having control over the brand,especially in China, where some-times the franchisees dont listenand dont tell you what they do.
The market was different too.For example, it was difficult sell-ing bread in Shanghai because itwould be considered expensive at$1.30 per item.
The food court business inChina was also in the red for sev-
en years. Mr Quek lost his savingsand took a year to rework the busi-ness before it started making mon-ey.
In the Middle East, the firmhad to tweak its products as the lo-cals love cookies and chocolates.
Out of 10 products, six aremade with chocolate and cheese,says Mr Quek.
I have done relatively well inentering China because Ive paidmy school fees after failing alot.
BreadTalk has three divisions bakery, food courts and restau-rants, including brands such asFood Republic and Din Tai Fung.
It had an annual turnover lastyear of $447.3 million with a netprofit of $19.4 million.
New frontiers are on the hori-zon as well, with the company hav-ing been approached with opportu-nities in Canada and America.
But for now, Mr Quek wants tofocus on expanding the groupwithout adding new brands to theBreadTalk family.
We dont have to keep comingup with new brands, but we needto constantly renew and refreshthe current ones to improve.
A friend asked me, what hap-pens when you reach 1,000stores? Then we start the processall over again until we reach atleast 5,000 outlets.
Relying on his in-depth knowledge of Asia, Mr Quek started BreadTalks firstfranchise outside Singapore, in Indonesia in 2003. Today, Indonesia has morethan 100 outlets, including this one in Jakartas Plaza Indonesia. ST FILE PHOTO
KEEPING IT FRESHWe dont have to keepcoming up with newbrands, but we need toconstantly renew andrefresh the current ones toimprove. A friend askedme, what happens whenyou reach 1,000 stores?Then we start the processall over again until wereach at least 5,000outlets. BreadTalk Group chairmanGeorge Quek
Mr Queks hands-on approach has helped generate explosive growth for BreadTalk, which now has more than 630 outlets, including other brands like Toast Box,across 15 countries, including Indonesia, Malaysia and Thailand. Plans are in place to have 1,000 outlets by the end of next year. ST PHOTO: JAMIE KOH
His strategy of staying in China tooversee franchises there has paid off
GLOBALISING SINGAPORE MONEY
Source: The Straits Times Singapore Press Holdings Limited. Reproduced with permission