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Texas Chicken (US) Targets Supersize Expansion in Malaysia

05 Dec 2017 - If you want a taste of Texas Chicken, head to Malaysia.

The Atlanta-based company, known as Church's Chicken in the U.S., has just opened its 42nd outlet in the Southeast Asian country, having expanded at a rate of nearly 10 a year since entering the market in 2013.

The latest outlet, in Kuala Lumpur's iconic Petronas Twin Towers, will be the chain's flagship store and also feature the country's inaugural Tex Cafe, serving gourmet coffee and desserts.

The chain, famous for its hand-battered chicken and honey-butter biscuits, has over 500 stores in Asia -- its second-largest market after the U.S. -- but plans to double that number over the next five years, according to a Channel NewsAsia report last year.

"Our vision is that restaurant concepts like Texas Chicken and Tex Cafe will serve as catalysts for further evolution of the brand, and a more personalized experience for our guests," said Tony Moralejo, the group's executive vice president of international business.

The group said Malaysia is a crucial market in its quest to be the "global franchiser of choice" -- a daunting task given it has to compete with the likes of KFC and McDonald's.

The company also has over 60 outlets in Indonesia and is present in Singapore, Vietnam and Laos. The Malaysian outlets are managed by Envictus International Holdings under an exclusive 10-year franchise deal running through 2022.

Singapore-listed Envictus plans to open another 10 outlets next year with a planned investment of at least 1 million ringgit ($245,000) in each.

The food and beverage group said it will target young adults in urban areas as it continues to develop its menu. Envictus also operates local coffee chain San Francisco Coffee as well as a number of food processing businesses.

The Malaysian fast-food market is growing despite cautious consumer spending, according to research company Euromonitor International. Existing players have been at pains to launch new products and value meals to attract price-conscious consumers.

Texas Chicken serves bigger pieces of chicken than its competitors and you get free refills of your soft drink, said a customer at the Twin Towers outlet.

Market leader KFC, which has over 700 outlets and a 42% share of the Malaysian market, is also expanding and making upgrades at existing stores, such as by installing Wi-Fi and cashless payments systems.

McDonald's Malaysia is investing 1.4 billion ringgit to raise the number of its outlets by over two-thirds to 450 in 2025.

The investment is part of a 10-year expansion strategy envisioned by Lionhorn, the Saudi Arabian company which holds the rights to operate McDonald's stores in Malaysia and Singapore.

Nikkei Asian Review



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