Restaurateur David Liu (劉順強) is on a roll, as this year has seen the continuance of the wave of growth that his business has enjoyed in recent years. The chief executive officer of Come Together International Co. points to the company’s opening of a gourmet Vietnamese restaurant named Little Spoon in Taipei City in April as an example of this growth. “Bubur cha cha [a typical Southeast Asian dessert] is too ordinary. You have to try our coconut fruit ice. The dessert is not ready-made. It’s made fresh by our cooks right here,” Liu says when asked to recommend the desserts Little Spoon has to offer.
The Vietnamese eatery and its parent group are just a part of the boom in Taiwanese restaurant chains taking place in both the Republic of China and other countries. Liu, who is originally from Myanmar and specializes in Thai cuisine, founded Come Together in 2001. The group runs 15 restaurants under five brands in Taiwan, including 11 providing Thai-style meals, two offering Italian food, and two others featuring Japanese and Vietnamese cuisine respectively. Since 2011, Come Together has also opened two overseas restaurants in Xiamen, a major city on the southeastern seaboard of mainland China.
Meanwhile, a much larger restaurant chain operator has been expanding in Taiwan and abroad since 2001. The Wowprime Corp. began operating its first restaurant, Wang Steak, in Taichung City, central Taiwan in 1993, and by 2001 it had opened 13 of the high-end steakhouses in Taiwan. However, the economic slowdown in the wake of the dot-com collapse around that time threatened Wowprime’s business, pushing it to diversify into other restaurant chains. “We pondered two options: waiting out the economic slowdown or targeting other customer groups,” recalls Endy Wang (王國雄), the group’s vice chairman and president. The company opted for the brand diversity strategy in the end and launched TASTy, a steakhouse chain, in 2001. Two years later the group made inroads into mainland China by opening the first Wang Steak in Shanghai.
The Wowprime group reached beyond Taiwan and mainland China when it licensed partners in Thailand and Singapore to open restaurants carrying its brands. Tokiya, which serves Japanese fusion cuisine, opened in Thailand in 2011, and the stylish vegetarian eatery Sufood opened earlier this year in Singapore. Wowprime provides consultancy services while the local partners run the respective restaurants. The group has benefited from its presence in the two Southeast Asian countries via the licensing fees and revenue earned by the restaurants. In fact, Wowprime and its Singapore partner opened Sufood there as a joint venture.
Braised curry beef with pumpkin, a signature course offered by Crystal Spoon, a Thai cuisine restaurant chain operated by Come Together International Co. (Photo by Huang Chung-hsin)
This year the group is equally excited about launching its newest brand, the Italian restaurant chain ita, the first branch of which opened in Taichung City in June, bringing the total number of Wowprime restaurants to more than 370—up from 164 in 2010. The 14 Wowprime chains are located mostly in Taiwan and mainland China and offer gourmet choices ranging from steak and vegetarian dishes to Japanese-style hot pot meals and Mediterranean pasta. According to Wang, the medium-priced steaks on offer at TASTy make the chain the group’s most profitable brand.
The rapid growth of restaurants in Taiwan is not too surprising, according to Chen Li-ting (陳麗婷), who works as a research scientist at the Food Industry Research and Development Institute (FIRDI), a government-funded nonprofit organization in Hsinchu City, northern Taiwan. A recent FIRDI survey indicates that Taiwan’s food and beverage retailers generated NT$400.7 billion (US$13.45 billion) in 2013, up from NT$326.3 billion (US$9.87 billion) in 2009. About 84 percent of this revenue came from customer purchases in restaurants. Such earnings understandably tempt new entrants in the field. “There is a phenomenal increase in the number of newcomers but you also see many pulling out of the scene, which reflects the fierce competition in the sector,” the researcher says.
A Taste for Thai
Chen says that there is a growing trend toward globalization in the restaurant business, and the overseas success achieved by Come Together and Wowprime is to a great extent a reflection of this trend. “The sector is showing a strong interest in expanding beyond Taiwan, which in turn has led restaurants to think about going public to raise the necessary funding,” she says. Indeed, Come Together and Wowprime are not the only Taiwan-based restaurants that are seeking to expand overseas. For example, Ding Tai Fung, which is known for its xiaolongbao, or soup dumplings, already operates 88 stores in 10 overseas markets in Asia, Australia and the United States.
Wowprime’s TASTy chain is known for offering quality steaks at reasonable prices. (Photo courtesy of Wowprime Corp.)
The quickly developing, huge consumer market in mainland China is integral to the sector’s efforts to reach beyond Taiwan. Major Taiwanese restaurant chains that have tapped into the mainland China marketplace include New Palace International Co., which is known mainly for its seafood restaurants in central Taiwan, and Gourmet Master Co., which operates the 85°C Bakery Cafe chain. New Palace has opened restaurants in mainland China since 2009, while Gourmet Master has also expanded to other countries. In addition to nearly 400 locations in mainland China and Hong Kong, Gourmet Master now has five 85°C shops in the state of New South Wales in Australia and 11 in California in the United States.
New Palace was listed on the Taiwan Stock Exchange in 2009, while Gourmet Master’s listing came in 2010. Wowprime became a publicly traded company in March 2012, and the Thai Tong Food and Beverage Group entered Taiwan’s over-the-counter GreTai Securities Market in September 2012. Thai Tong operates three restaurant chains including the popular Thai Town Cuisine, which has nearly 50 locations across the island, making the group the largest developer of Thai restaurants in Taiwan. In November 2013, the Thai Tong group launched its first overseas operation by opening a Thai Town Cuisine outlet in Shanghai.
“In general, Taiwan’s restaurant sector is of a higher quality than its mainland Chinese counterpart, which is why there is a good chance we can succeed there,” Wowprime’s Wang says. However, he believes that only major chains should explore the mainland Chinese restaurant market because the competition there is already very strong. That is especially true in large cities like Shanghai and Beijing, where the rent is about three to five times that of Taipei City. “The cachet that comes with being a large, well-known chain helps you secure a good location for your business,” he adds. “Individual restaurants might find it hard to survive there, although there is perhaps still some chance for them in smaller cities.”
The resolve to maintain the quality of cuisine and services is crucial to a restaurant’s survival and sustainable growth. “We use Thai ingredients and follow Thai recipes, while adjusting for Taiwanese palates by making the food less salty, less sour and more mild than it’d be in Thailand,” says Rattawan Hong, a senior Thai chef with the Come Together group. Much of the appeal of the restaurant’s dishes, Liu notes, is attributed to spices, which are “the soul of Thai cuisine.” Key Thai spices include lemon grass and galangal, a kind of ginger often used in Southeast Asian cooking. “The vast majority of our spices are imported from Thailand. Those grown in Taiwan just aren’t fragrant enough,” he adds.
Grilled shrimps prepared by Crystal Spoon, which is serious about the authenticity of the meals it offers (Photo by Huang Chung-hsin)
Hong is responsible for supervising and standardizing the quality of the dishes served in the group’s Thai restaurant chains, the Crystal Spoon and Silver Spoon. To that end, she returns to her home country once a year in search of innovative new Thai dishes that she can replicate in Taiwan. Both restaurant chains have been recognized for the authenticity of their foods by the Thai government, which promotes the national cuisine of Thailand by certifying Thai restaurants around the world.
The food alone cannot explain Come Together’s good performance, as the group’s revenue and number of restaurants continue to grow year on year. “The tableware used in our restaurants is made-to-order and one-of-a-kind,” Liu says of other factors behind Come Together’s success. He is also proud of the services provided by the restaurant staff. For example, the first course must be served within eight minutes of the customer’s order, and all courses must be on the table within 25 minutes. “And we’re attentive to detail. As soon as the patron looks up from the menu, our people approach and are ready to help,” he says. Such high-quality service easily wins approval and impresses customers in mainland China, where it is not unusual for the customer-waiter interaction to spoil the dining experience. “Few restaurants in mainland China ask patrons to pay for services. Instead, they collect additional fees by, for example, asking them to pay for chopsticks and paper napkins. But our restaurants in Xiamen insist on adding a 10 percent service charge, just like in Taiwan. That has helped locals there learn the value of good service,” he adds.
Incentive to Pamper
Wowprime provides strong incentives for its employees to pamper customers with quality foods and services. “Our enterprise gives the store manager and chef of each restaurant the opportunity to own a stake in the company,” Wang says. “The staff in our restaurants strive to do their best so that one day they can become a manager or a chef, which are the two pillars of each restaurant.”
Come Together’s Little Spoon and Crystal Spoon restaurants sit side by side in a Taipei City shopping mall. (Photo courtesy of Come Together International Co.)
Another morale-boosting Wowprime policy allows a third of the profits generated by each restaurant to be shared among all members of its staff every month, the executive notes. “We treat our staff as partners rather than employees. They’re enthusiastic about guiding new recruits because they know each person is crucial to the restaurant’s effort to turn a strong profit,” he says. Such a self-management mechanism is critical for Wowprime, especially when the group is growing fast and finding it increasingly challenging for the headquarters to direct each restaurant’s operations, Wang says.
Wowprime also offers a training system that provides classroom-based and online courses focusing on subjects such as leadership and cooking skills. According to Wang, performance in the class is factored into the group’s decision to promote a member. “This program effectively serves to train people in a systematic manner. It also helps unify the entire company team in terms of a corporate mindset,” he says.
On the downside, both Wowprime and Come Together express concern over a looming labor shortage. “Young people are unwilling to work in the service sector today because of the long hours,” Wang says, adding that Wowprime needs to recruit 2,000 to 3,000 employees every year. “And it’s becoming more difficult to ensure the quality of new recruits because of the larger amount of workers needed,” he says.
There is also the question of food safety, which has been a hot-button issue in recent months after several well-known businesses in the sector were found to be engaging in dubious practices. “The overall environment is increasingly threatened by pollutants of all kinds, and the public is growing more aware of the issue of food contamination,” Wang says. In response, Wowprime will be setting up a food safety department in the third quarter of this year. Previously, food safety was handled by a smaller section under the group’s purchasing department. “We try to test food materials and ingredients from our suppliers as often as possible, but there are so many items that food safety is always an issue,” he notes.
Little Spoon, Come Together’s newest brand, debuted in April this year and offers dishes like pho with raw beef, a traditional Vietnamese noodle soup. (Photo courtesy of Come Together International Co.)
Wowprime certainly has no intention of halting its expansion, as it plans to add about 80 restaurants to its global network by the end of this year. The group is also in talks with prospective US partners about a joint investment deal for Wowprime’s first restaurant in the United States. Meanwhile, Liu of Come Together plans to open two more restaurants in Xiamen at the end of the year and expects to see his group expand to a total of 20 establishments by 2016.
Taiwan’s restaurant sector keeps on expanding and its success is a result of astute entrepreneurship as well as a customer-oriented culture. These two Taiwan-based business groups are recent examples of the country’s competitiveness in services and an unabating quest to go global.
Write to Oscar Chung at mhchung@mofa.gov.tw