Starbucks Malaysia to open more premium coffee stores this year

By SHAZNI ONG / Pic By TMR

Berjaya Starbucks Coffee Co Sdn Bhd (Starbucks Malaysia) aims to open two to three more Starbucks Reserve premium concept coffee outlets this year backed by growing coffee knowledge among consumers.

Berjaya Food Bhd CEO and Starbucks Malaysia and Brunei MD Sydney Quays said the reception to the company’s first store at The Gardens Mall since three years ago has been good.

“We really did not anticipate such a strong reception for earlier stores as there were a lot to do with the education process to really (get people to) understand coffee.

“What really surprised us is that there were many people interested to learn about coffee. That’s what inspired us to open this eighth store,” he told reporters after opening the 5,000 sq ft Starbucks Reserve store at Berjaya Times Square in Kuala Lumpur last Thursday.

He added that some customers come in for different brewing methods everyday and the group plans to open a few more Starbucks Reserve stores in the country to cater to such a clientele.

Quays said there won’t be many Starbucks Reserve stores due to the small number of farms producing the kind of coffee that Starbucks Reserve stores serve to the customers.

“The Starbucks Reserve concept is very exclusive and the coffee menu here, you won’t get it at any other non-Starbucks Reserve outlets.

“So, it is very critical that we expand carefully and in locations that Starbucks Reserve is well appreciated,” he said.

Quays said the allocated capital expenditure (capex) for expansion is between RM50 million and RM60 million yearly, and the capex spent on a normal outlet is 30% lower compared to a Starbucks Reserve outlet.

Quays said the group, which is marking its 20th anniversary in the country, plans to open some 30 outlets per year.

“We would continuously open in that manner. However, the store mix would be different. It could be drive-through, Starbucks Reserve(s), normal stores and (the ones) at transportation hubs.

“We are averaging now at 6% for our same-store sales growth and pushing it up to 8%. With strong same-store sales growth and new expansion in different formats, I think Starbucks would be strong and would help Berjaya Food,” he said.

According to Quays, Starbucks Malaysia currently holds about 60% of the market share in the coffee store/outlet business.

He added that the group has not experienced a drop in its business in recent months.

“I think people are a bit more confident now in their spending as a lot of the uncertainties are over.

“We also see the number of tourists going up as we rely quite heavily on them due to our stores located at high tourist destinations, such as airports,” he said.

On the outlook of Berjaya Food for the 2019 financial year, Quays anticipates a better performance of its Kenny Rogers Roasters (KRR) business in Malaysia and Jollibean business in Singapore.

“The KRR brand has had a few challenging years, but we see it improving tremendously this year. In Singapore, Jollibean is also improving through a lot of new initiatives implemented,” he said.