Secret Recipe to open 100 outlets in China
By Kevin Tan
Home-grown confectioner Secret Recipe Sdn Bhd is eyeing the Chinese market in a big way with plans to open 100 outlets in China by 2010.
Its chief executive officer Steven Sim said: ˇ°We are talking to potential partners in China and hopefully we can start our business by the end of next year."
Speaking to reporters on July 6 after signing international franchise agreements with the companyˇŻs partners from East Malaysia, India and New Zealand in Putrajaya, Sim said China is ˇ°a challenging marketˇ± and a lot of ground work needed to be done.
ˇ°We have to move very fast because people will imitate you,ˇ± he said, adding that this is the reason the company will be opening so many outlets within the first three years of operation.
ˇ°Obviously Shanghai will be our first target market and Beijing next,ˇ± Sim said.
He said the company was looking at either carrying out a joint venture with local partners or implementing a franchise scheme in its expansion to China.
Currently, there are 120 Secret Recipe outlets in Southeast Asia. There are 100 in West Malaysia, of which 45 are franchisees,10 in Singapore as well as five in Indonesia and Thailand respectively.
Sim said Secret Recipe was expecting a 35% revenue growth for the year ending Dec 31, 2006 with its overseas expansion. Last year, the company made about RM70 million in revenue, including franchise fees.
Sim reckoned that the company could open another 100 outlets in Malaysia within the next three years with its foray into East Malaysia and the smaller towns. It costs an average of RM400,000 to open one Secret Recipe outlet, he said.
The first Secret Recipe outlet in East Malaysia is scheduled to open this September. It is also planning to open up to 15 outlets in India and New Zealand in the next three years.
ˇ°We are proud to say that Secret Recipe is one of the first brands in Malaysia that attracted foreigners to buy our franchise and bring it overseas,ˇ± Sim said.
Besides China, it was also planning to expand to the Middle East, namely Saudi Arabia and the United Arab Emirates, he added.
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