Time to say goodbye


Loo:

PETALING JAYA: Popular tea drink Chatime in Malaysia will be rebranded soon after its Taiwanese franchisor ended the partnership prematurely.

Chatime master franchisee for Malaysia, Loob Holding Sdn Bhd, said in a statement yesterday that it was now in the process of creating its own brand for its 165 outlets after the termination of its franchise by La Kaffa International Co Ltd.

According to Loob Holding CEO Bryan Loo, the company’s management is working closely with sub-franchisees, outlet supervisory staff, frontline workers, partners and associates, and the pace would intensify in the coming weeks. He added that the company would aim to keep its 1,000-strong workforce, who were now 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.

“We will surely come up with something better. Loob Holding has 10 brands, including this Taiwanese brand which we have built from scratch in Malaysia,” Loo said.

The dispute between La Kaffa and Loob Holding came out in the open when the franchisor announced that it had terminated the agreement at a press conference on Jan 6 and that would take over all the 165 Chatime outlets in Malaysia.

Loob’s Chatime franchise still has 24 years to go before the termination.

Loo clarified that Loob Holding and/or its sub-franchisees were still operating all the 165 outlets, although it had been reported that La Kaffa would take over the Malaysian business operations and development.

In accordance with the franchise agreement, all the current outlets would cease using the Chatime branding only after 45 days and Loob Holding has given such notice to La Kaffa in a letter last week.

He said there have been disagreements and disputes over various business and operational matters, but they were dealt with in accordance with the terms of the franchise agreement.

Chatime Malaysia’s outlets accounted for over half of the turnover recorded by the franchisor’s reported 800 outlets worldwide.

Loo had earlier said his group would seek legal advice to protect its legitimate rights and interests under the franchise agreement, which was supposed to expire only in 2041.

“Although our agreement with them (the franchisor) still has 24 years to go, they had unilaterally served us a termination letter on Jan 5,” he said early this week.

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