Bubble tea business Chatime has unveiled its first corporate-owned store in the US at Westfield Culver in Los Angeles.
The move is the first step in Chatime’s mission to reach 1000 outlets across the US within 10 years.
Another two corporate locations will open in LA in the next few weeks at Sherman Oaks and Torrance.
Carlos Antonius, CEO of the Chatime Group Australia and Chatime Global USA, told Franchise Executives “Our strategy is to invest in corporate locations in one state in a cluster strategy to make amendments to the model for the US from proof of concept. We are making minor adjustments to support the growth of franchising.”
Chatime plans US growth
Over the past decade Chatime has opened 16 locations across the US. Ten of these are single units with one master franchisee in Maryland holding six outlets.
“Part of the road map is consolidating existing franchise partners; as renewals come up under their agreements we will bring them under the new entity,” said Antonius.
The new entity, Chatime Global LLC, is a joint venture between the Australian business and the parent company in Taiwan.
“When Chatime first launched in the US, the approach was to grant investors opportunities, and they were left to manage and build their businesses, which has worked well for some,” said Antonius. “Now we will bring in some structure and discipline. We will appoint the right support resources, consolidate the network and grow to our target of 1000 locations in 10 years.
Scaling the business across the US
“Franchisees are generally very committed to their investments, and we are supporting them through the transition. They’ve done the heavy lifting to build the business; we will work and collaborate with them to grow further.
“Many will stay single operators but some have indicated they are interested in scaling with us, which is great news.”
Antonius is spearheading a strategy of multi-unit expansion, with franchisees signing up to a minimum of three stores. The first deals are likely to be in Florida and Texas.
“We have all the operation and strategic management for the US market,” he said. “Over the last four years we’ve invested heavily from financial advisers to tax advice, to appointing a franchise sales organisation (FSO) to oversee recruitment.”
Chatime US growth will be supported by local experts. Chatime has partnered with FranDevCo to help the brand grow its footprint across the US.
Antonius said supporting franchisees with a local team is crucial to the brand’s growth.
“Historically support for franchisees was managed out of Taiwan. We’re investing in HR in the US, starting with a manager for corporate locations, based in California.”
Further hires will be for marketing, training and a head of operations.
