Inside Franchise Business - - Industry Spotlight -

Af­ter over 10 years in the Aus­tralian mar­ket, fran­chise Chatime has carved out an im­pres­sive rep­u­ta­tion as the na­tion’s largest Bub­ble-tea brand. With an em­pha­sis on met­ro­pol­i­tan ar­eas, the Tai­wanese fran­chise has trans­lated a strong lo­cal his­tory of iced-tea suc­cess into a boom­ing global net­work.

The brand is in the midst of open­ing its 100th Aus­tralian lo­ca­tion, with a goal of hav­ing 110 Chatime sites up and trad­ing by Christ­mas.

Chatime en­tered the Aus­tralian mar­ket at a time when bub­ble-tea was un­heard of to the Cau­casian de­mo­graphic, with Chatime gen­eral man­ager Car­los An­to­nius sug­gest­ing the brand’s po­si­tion­ing and cul­tur­ally di­verse fo­cus has been crit­i­cal to Chatime’s pro­longed suc­cess.

“Over the last cou­ple of years, we’ve re­ally worked on repo­si­tion­ing our of­fer­ing, re­ally giv­ing the brand a much wider main­stream ap­peal, rather than just tar­get­ing the Asian de­mo­graphic,” An­to­nius said.

“We re­ally tried to give a west­ern ap­peal with­out west­ern­ising the brand. That’s been a real cul­ture piece, and there’s been a lot of ini­tia­tives im­ple­mented both in­ter­nally and ex­ter­nally to help drive that repo­si­tion­ing, which has been suc­cess­ful to date.”

While get­ting on at the ground floor is of­ten an op­por­tu­nity to de­velop brand loy­alty early, it also presents the chal­lenge of con­sis­tent new mar­ket com­pe­ti­tion. The last five years have seen a range of lo­cal and in­ter­na­tional bub­ble-tea fran­chises ex­pand into Aus­tralia, and while An­to­nius ad­mits there are sec­tor chal­lenges, a grow­ing in­dus­try is al­ways a good thing.

“We wel­come new play­ers, by hav­ing more com­peti­tors in the sec­tor, it grows the gen­eral aware­ness of bub­ble-tea as a con­cept. The chal­lenge for us is that whilst we are the size that we are, and we are still nim­ble an ag­ile as a com­pany, a lot of other en­trants that are set­ting up in the re­gion have a lower cost of en­try. There are chal­lenges in that, but what we’re re­ally fo­cused on is how we con­tinue to in­no­vate our busi­ness.”

In­no­va­tion and adap­tion have been crit­i­cal to Chatime’s op­er­a­tions, with new ini­tia­tives prov­ing to be key driv­ers for suc­cess. The brand has achieved dou­ble digit like-for-like growth for three years in a row, and has its sights set firmly on con­tin­ued growth.

“Our tar­get that we set to achieve is 200 stores by 2021, and we’re on track to achieve that, and we still have a sig­nif­i­cant num­ber of metro lo­ca­tions in ma­jor cities. What is crit­i­cal is for us to con­tinue to re­duce our cost of en­try, so that we can get quicker re­turn on in­vest­ment for our in­vestors and con­tinue to grow the brand.”

Chatime has put em­pha­sis into dig­i­tal in­no­va­tion as well, with the launch of the brand’s in­tu­itive loy­alty app, which presents con­sumers with the abil­ity to place an or­der and be re­warded with­out the need for hu­man in­ter­ac­tion.

An­to­nius sug­gests dig­i­tal ini­tia­tives like this are crit­i­cal to chan­nelling the brand’s tar­get de­mo­graphic of young, tech­no­log­i­cal savvy con­u­mers.

“We im­ple­mented a se­ries of sig­nif­i­cant dig­i­tal ini­tia­tives, our loy­alty app is now live, and we re­ally value in­no­va­tion, so how can we re­main rel­e­vant? It’s about con­stantly evolv­ing the brand and chang­ing the per­cep­tion of what bub­bletea re­ally is.”

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