In light of the drama surrounding the Chatime brand in Malaysia, Loob Holding Sdn. Bhd. has decided to move towards creating a new brand after its franchise agreement was terminated by La Kaffa International Co Ltd.
Loob Holding CEO Bryan Loo has confirmed that the company will assume operations in all 165 existing Chatime outlets in Malaysia under the yet-to-be-named brand, adding that the management is working closely with sub-franchisees, outlet supervisory staff, frontline workers, as well as partners and associates to solidify the tea franchise under a new brand.
It all began when La Kaffa - a Taiwan company who owns the Chatime brand name - announced in a press conference that they will be terminating the master franchisee contract with Loob Holding on 6 January
In the press conference, La Kaffa chairman Henry Wang said that the company will be taking over Chatime's business operations and development in Malaysia with immediate effect. Executive vice-president Teresa Wang added that La Kaffa has actually been preparing to take back the Chatime franchise in Malaysia for a year.
Loob Holding filed a police report and sought legal advice after news of the purported termination broke. Loo himself revealed that Loob Holding's agreement with La Kaffa was supposed to last for another 24 years until 2041 and that there have been disagreements and disputes over various business and operational matters in the past, but they were eventually dealt with in accordance with the terms of the franchise agreement.
Despite La Kaffa's intention to take over the Chatime business in Malaysia, looks like that's not gonna happen with Loob Holding's latest decision to move forward with a new homegrown brand
Loob Holding and its sub-franchisees are still operating all 165 Chatime outlets, although they will cease to use the Chatime branding 45 days after handing in a notice to La Kaffa last week.
In a statement released yesterday, 23 January, Loo reiterated that the company is still working with the same management team and continue its growth with "its 1,000-strong workforce who is now already serving two million customers each month."
"We have the same team, the same people, both employees and partners, in place at the same outlets. We expect consumers to find that we now have a different name, only better," he said.
Loo is also confident that Malaysians will continue to support the company as they start over with a new brand name for the tea franchise
"We are indeed grateful for the support from Malaysians these past six years. In fact, we are encouraged and motivated by the expressions of support for our current dispute, many of which are unsolicited and through various channels, including social media," he said.
Besides Chatime, Loob also manages several well-known food and beverage brands in Malaysia, including Tino’s Pizza, Soda Xpress, Llaollao, and Gindaco.
As for existing Chatime employees, Loo said that they will be given an average of two months bonus this year. Frontline service staff will also be getting ang pows.
"The welfare and livelihood of the entire 1,000 team members are always close to our heart," he said.