Retail in Asia

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Supertea and R&B Tea to expand into the Philippines

R&B Tea

Singaporean operator and manager of food courts and coffee shops, Koufu Group Limited announced that its subsidiary Super Tea (S) Pte. Ltd. has entered into a master franchise agreement with Shakey’s Pizza Asia Ventures Inc. to expand the Supertea and R&B Tea brands to the Philippines, congruent with its strategy to actively develop its concept brands in both local and overseas markets.

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Mr Pang Lim, Koufu’s Executive Chairman and Chief Executive Officer, said: “We are excited to bring our high growth tea beverage concept brands to a new market, the Philippines, with Manila as our initial landing point. This marks our second milestone this year, following the acquisition of Deli Asia Group, despite the challenging market conditions from the impact of the COVID-19 pandemic. We have carefully considered the market trends and found the conditions in the Philippines to be favourable, where there has been a growing receptiveness towards the bubble tea culture in recent years. We are confident that the locals will enjoy our R&B Tea beverages, as do our customers in other markets.”

Under the master franchise agreement, Shakey’s will be awarded the rights for a term of seven years. The master franchisee will adopt a co-branding strategy to sell selected R&B Tea drinks in Shakey’s and Peri Peri stores in the first year of business, and subsequently to open at least five self-operated stand-alone R&B Tea outlets. In addition, the master franchisee also has the rights to sub-franchise R&B Tea to sub-franchisees within the seven-year term. The group will collect franchise fees, royalties and marketing fees as part of the agreement.

Shakey’s is the Philippines’ market leader in both the chained pizza full-service and chained full-service restaurants. It is a well-established brand, offering iconic products which include handtossed and thin-crust pizza, chicken, mojos and pasta. In line with its vision of having a portfolio of industry-leading brands, it acquired Peri Peri Charcoal Chicken brand and expanded to 30 outlets from the original 22 in about six months. With a firm belief in the potential of the Philippines’ bubble tea market and quality of R&B Tea products, Shakey’s is committed to invest in the bubble tea business as its third pillar of growth.

Mr Pang added: “We adopt stringent evaluation criterions in selecting our strategic partners to ensure the success of our expansion, such as possessing deep F&B experience in the local market. Shakey’s is one of the largest F&B players in the Philippines, well-established in their systems and processes. We are pleased to have found a strong strategic partner in Shakey’s, which is also publicly-listed in the Philippine Stock Exchange, to expand our footprint in the region.”

“One key quality in any F&B business is the access to prime locations in malls and landlords. The co-branding strategy offers us immediate access to an established network of prime sites under the Shakey’s and Peri Peri branding, which allows us to quickly expand our presence in the market. Subsequently, we target to open at least five new R&B Tea outlets throughout Metro Manila,” continued Mr Pang.

Vicente Gregorio, Shakey’s President and Chief Executive Officer said: “We are pleased to bring the R&B Tea experience to the Philippines, and we look forward to wowing our guests with these new offerings. This co-branding initiative is likewise in line with our renewed focus on out-of-store consumption, enhancing sales through these channels with minimal additional investment and maximising the use of our existing assets.”

The Philippines market is receptive to the bubble tea culture with a growing bubble tea market and offers huge business opportunities for Super Tea (Int) Pte. Ltd.1. Metro Manila, the Philippines’ economic and political centre, has a population of more than 10 million and more than 150 shopping malls. Additionally, the Philippines has a large population of approximately 45 million within the age group of between 15 to 39 years old, which is the target market for bubble tea.

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As at 30th June 2020, Koufu has a total of 26 R&B Tea outlets and a Supertea outlet in Singapore. The group has also established its first R&B Tea and Supertea outlets in Macau and Malaysia, and opened its first R&B Tea outlet in Indonesia at Emporium Pluit Mall on 4th July 2020, and the second outlet at Summarecon Mall Serpong on 16th August 2020. Till date, Koufu has secured three leases for R&B Tea kiosks in Singapore, which are slated to open in the second half of 2020.