COFFEE PERK$
Companies combine coffee with opportunity, providing a range of education and business services for Chinese immigrants The brewing of a unique partnership
When Vancouver’s Blenz Coffee first arrived in China two years ago, it had big plans to edge out Starbucks by 2005. This daunting goal made headlines, but never happened. Behind it, however, there is a tale of some Vancouver entrepreneurs and their efforts to provide all sorts of services — immigration, travel, education, media, and now the chance to do business — to new and landed immigrants from China as their numbers have increased and their needs evolved.
Canadian Overseas Holdings (COH), a local company headed by Beijing-born Sunny Bai, his brother James Wang and others, started in the mid-1990s as a provider of immigration services, mainly for mainland Chinese clients.
“ Then, we noticed that these people wanted to travel back and forth,” Wang said in an interview.
So, the company took over Canada Swan International Travel, the go- to agent on Granville Street for good deals and expertise on traveling to China.
Later, “ we saw they also wanted to receive education,” Wang said.
So, it established Pattison College, which prepares students for post-secondary programs by improving their English. The school also provides access to business and MBA programs.
“ When we realized that they wanted to read a newspaper of their own, we started the China Journal,” a publication with content geared specifically for immigrants from China, as opposed to Hong Kong and Taiwan.
“Now, many of our clients have developed a feeling for living here, but some of them want to go back to China and do business there.”
Enter Opportunity Blenz. Blenz opened its first store on Robson Street in 1992. Four years later, it opened a second store at Whistler. Now, it has over 35
stores are all over Vancouver and in the suburbs.
In China, however, it
is backed and managed separately by
COH. The company
does some advertising
for its franchises on
p o p u l a r C h i n e s e Internet search engines. Mostly, however, it relies on word-of-mouth chattering that starts in Vancouver and follows leisure and business to travellers to Beijing, Shanghai, Guangzhou and then fans out
to other Chinese cities.
“People hear about Blenz from friends who visit here on business visas,” Wang said.
“Others have lived here for a few years and want to take something from Canada back to China.”
When Bai and Wang first took Blenz to China, talk was of 50 stores in the first year. Today, there are only 19 stores. One of their biggest challenges has been to identify the right kind of onthe- entrepreneur.
“Franchising is relatively new in China. There are a lot of wealthy people who have money to invest, but sometimes all they want to do is just bring in as many customers as possible without respecting guidelines for the brand,” Wang said. “ So, we are going more slowly. We aren’t expanding dramatically, but are focused on selecting people carefully.”
China’s new class of eager entrepreneurs is keen to learn about the franchising model, where a business person owns a restaurant or cafe, shares partial profits with a parent company and agrees to specific rules on everything from how to buy ingredients, wipe shelves, manage employees and handle customers.
But “ enforcing uniformity standards is the most difficult obstacle foreign franchisors face in China, ” Ye-Sho Chen, a professor at Louisiana State University in Baton Rouge and a expert on franchising in China, said in an email response. “It was one of the major reasons why A& W failed in China.”
A& W opened its first branch in China in 1996. Last year, its parent company, Louisville, Ky.based Yum! Brands pulled out completely after not being able to resolve what it cited as problems with franchise regulations. Others chains, like Dunkin Donuts and Rainforest Cafe, have also gone and failed.
“ It’s China. It’s easy to just throw up stores. But we want to open one, have it be successful, then open another,” Wang said. “ We have to work closely with [franchisees], help them analyse plans. Sometimes, they have their own thoughts.”
To keep tabs, COH runs spot checks from management offices based in the country’s main cities. There is also ongoing training, including sessions in Vancouver to inculcate a sense of the Blenz coffee culture.
Most locations are run by franchisees who have always been based in China, but recently some of the most successful ones are managed by ex- Vancouver residents, who immigrated to Canada, but now have an itching to be back in the business bustle of China.
In Hangzhou, for example, the Blenz store is managed by a young woman who lived in Vancouver for a few years.
“She was already known as the ‘ king of restaurants’ in Hangzhou before she came to Canada. So, she was able to get a [ prime] location right on the banks of [ the city’s scenic] West Lake ... She also really understands Blenz.”
jlee-young@png.canwest.com