Having both feet firmly in this boat
A commitment to building Malaysian food brands is bringing this entrepreneur places
TONY Lim first explored the idea of his own restaurant in late 2013. Four years later, not only is he running his own restaurant chain, he is also creating food and beverage brands under his company Utara 5 Food and Beverage Sdn Bhd (U5FB).
“We try to create new brands based on what the market needs or what we think is missing from the market,” says Lim.
The 38-year-old currently has the Boat Noodle and Chill Chill brands under his belt and recently started two more – MKN and C&C.
Once the brands are well established, Lim is also exploring the possibility of licensing out his brands next year.
But Lim’s initial plan did not revolve around F&B.
In fact, the engineering graduate set up his own car workshop after completing his education.
His parents, who run a trucking company, were supportive of his idea and provided him with the capital for his workshop. But there was a caveat: if it was not profitable after two years, Lim would return to his hometown in Kedah and manage the family business.
Two years passed by very quickly.
“And sure enough, we were losing money. I gave out too much credit. I was more like an engineer than a businessman and did not manage the cashflow,” says Lim.
He tried borrowing more money from his parents to keep his workshop going but eventually, the credit line was pulled.
A deal is a deal.
So Lim sold the business for about RM80,000 and went home to join his parents’ trucking company, which runs trucking services from Singapore to Thailand, in 2005. He expanded the business and set up offices in Kuala Lumpur, Bangkok, Cambodia and Jakarta.
In 2012, his youngest sister graduated from Australia and wanted to start an F&B business.
So he helped her set up a company in Cambodia, which became the master franchiser of Chatime there.
His involvement in the company in its early months taught him a lot about setting up an F&B operation.
“Then I realised I could do F&B too,” he says.
So the enterprising man started looking out for ideas that he could work with.
“My wife wanted to open a Thai restaurant with a full-fledged menu. But it would be hard to scale up,” he says.
He wanted an operation that was as simple as possible without having to rely too much on a chef’s ability.
He settled on boat noodles and some of his other favourite Thai street food.
Lim bought recipes from stall owners in Thailand for about RM5,000 to RM8,000 per stall and found a way to simplify the cooking methods to be implemented in Malaysia.
With a budget of RM160,000, U5FB launched its first Boat Noodle restaurant in Empire Damansara in 2014.
During the early months, Lim took on extra duties to help keep the business running. In the mornings, he would complete backend tasks before heading to the shop in the afternoon as part of the floor crew.
“The first thing to do when you open an F&B store is to convince people to accept new things. Of course, you need to be confident that what you have to offer is good. The hardest thing is to get people to come for the first time. Then, you need to figure out how to make them come back,” shares Lim.
Luckily for him, Boat Noodle opened its doors in the era of “sharing”.
Noodles at the restaurant are served in small portions and counting the number of empty bowls they could stack became a novelty for customers. The restaurant enjoyed a lot of exposure as patrons were more than happy to share about their visit to Boat Noodle on social media.
This helped Boat Noodle to grow quickly. The company expanded to nine outlets in one year.
Not long after, Lim added Thai milk tea and coffee to its menu.
He then started noticing that some customers would go to his restaurants just to get their milk tea.
This gave the company an opportunity to spin off the milk tea under its Chill Chill brand. It started off as a pushcart stall in Tesco Mutiara Damansara, Petaling Jaya, two years ago and has grown to 17 kiosks to-date.
Lim then took another opportunity to start a cookie and coffee kiosk under the brand C&C, which allows customers to fill a standard bag with cookies at a fixed price.
He is also looking to launch another F&B brand in November.
While U5FB seems to be enjoying rapid growth, building your own brands from scratch is not easy.
“There is no one there to guide you. Like in our first outlet, we didn’t have proper floor drainage for the kitchen and it was hard to clean. And we never thought about things like trademarks and all that until much later. So it was easy to start, but a lot of things weren’t done properly,” he admits.
But Lim was adamant not to build his F&B business on existing franchises although he noted that that would have been easier.
“You don’t need to think too much about the setup. Everything has been thought out for you. You just need to follow the manual.
“But at the same time, you can’t do much. The value that you build is not yours. You may run the business but the value of the brand belongs to someone else.
“When it’s your own brand, you have the flexibility to do anything. So for us, we started simple, like a blank piece of paper. And we made mistakes along the way,” he says.
Nonetheless, it has been worthwhile
Lim is looking to end the year with 45 Boat Noodle outlets, 25 Chill
Chill kiosks and five C&C stores.
U5FB’s growth has not gone unnoticed.
Last year, Japanese udon restaurant chain operator Toridoll Holdings bought a 40% stake in U5FB for about 800 million yen (RM30mil). A report noted that the Japanese company intends to gradually increase its stake to 60% in 2019.
According to Lim, U5FB is looking at revenue of about RM76mil this year.
The entry of the new shareholder has also enabled the company to tap into a new source of funding and network to expand its brands overseas.
The company has expanded its Boat Noodle business to Brunei and Jakarta and will be opening outlets in Myanmar and Singapore within the next six months.
Today, U5FB has about 660 employees and Lim hopes that they will, one day, be able to share in the company’s growth.
He has plans for a listing exercise sometime in 2019. The company has, after all, gone through due diligence following the acquisition by its Japan-listed shareholder.
Lim chats animatedly about his journey as an F&B operator and is glad to have come this far as an entrepreneur.
And now that he has come a long way from his car workshop, his advice to future entrepreneurs is to start first and think later. Don’t miss the boat, as they say!