Loob focuses on expanding Tealive

> Owner of home-grown bubble tea brand unfazed by ongoing arbitration with La Kaffa

PETALING JAYA: Loob Holding Sdn Bhd is unfazed by the ongoing arbitration with La Kaffa International Co Ltd, owner of the Chatime brand, and is instead aggressively expanding its own bubble tea business, Tealive, internationally.

Tealive was created following a dispute between Loob and La Kaffa early this year that saw the Taiwanese franchisor terminate its Chatime master franchisee contract with Loob.

Loob CEO Bryan Loo ( pix) expects the outcome of the arbitration, which is being conducted in Singapore, to be known only towards the end of next year, which he said will result in either monetary compensation or fine to the company. From now until the arbitrator’s decision next year, he said, Tealive can be expanded to more than six countries.

“The results will not affect us, because arbitration is straight forward. It’s dollars and cents. The arbitration is ongoing and lengthy but that doesn’t stop us from what we wish to do. It’s business is as usual now,” he told SunBiz in an interview recently.

Loo said following the news of the dispute, the company received many overseas enquiries in the last six months, likening it to a blessing than a crisis.

“Reputation is not our biggest worry. We’ve gained reputation from creating the business from scratch. But people is everything. We owe it 100% to our people ... what we’ve created over the last six years is not only a brand and a business. We managed to create a soul behind the business and when we lost the brand (Chatime), people are still able to recognise us,” said Loo.

He said Tealive’s same-store sales growth in Malaysia spiked 20% in the first three months to average at 5% a month now compared with its Chatime sales last year.

Loob manages nine food & beverage (F&B) brands under its umbrella, including Tealive, Llaollao, Tino’s Pizza, Gindaco, Croissant Taiyaki, Soda Xpress, and Define: Food. About 65% of the company’s revenue is derived from Tealive.

Loob was previously a multi-brand company with a vision to become one of the most dynamic regional multi-label F&B organisations. But as Tealive’s brand owner now, Loo said its vision and mission are clearer.

“This year, we got the opportunity to own our brand, so the next thing is all about overseas expansion. Our current focus is to deliver Tealive into an international lifestyle tea player in the region,” said Loo.

Over the next three years until 2020, Loob wants to grow Tealive to 1,000 outlets globally. It aims to expand to 15 countries by 2020, including Vietnam, Australia, and others in Asia and Europe. It expects to close the year with 180 outlets in Malaysia and four outlets in Vietnam, with plans to open Tealive in six countries next year. Loo said its mandate for going overseas is that it has to hold a majority stake there, such as in Vietnam where it is a substantial shareholder in the joint venture company. “If that market is run by our operator, they deserve the majority. But if we’re going in ourselves, then we deserve the majority. It’s like who runs the show,” said Loo. He said Tealive’s stores in Vietnam are five to 10 times bigger than Malaysia’s and that its product price point in Vietnam is 20% more than that here, due to its large young population and high disposable income. “As a principal now, there’s also a lot more responsibility on our shoulders. A lot of effort is put in to build the foundation of the company, including R&D and technology, rolling out self-service kiosks by the first quarter next year.” Locally, it is expanding into petrol stations and transport hubs and expects the ratio of company-owned and franchisee outlets to reach 50:50 by 2020, from 70:30 now. Loo said as long as it has 50% of company-owned stores, it is able to have a solid franchise system to support its franchisees. As for Loob’s other brands, he said its objective is market dominance and it will continue to make deeper inroads into the domestic market.