Hitting its stride in hospitality

  • Sme
  • Saturday, 06 Sep 2014

The Library Coffee Bar is a cafe concept that tries to exude an environment akin to that of an actual library.

AUM Hospitality Sdn Bhd (AUMH) grabbed headlines when they brought American diner franchise Johnny Rockets to Malaysia last year, but this was only the first step in the growth of a new food and beverage (F&B) empire.

The group was initially founded in 2010 by mainly three business partners who pooled together their resources and years of experience in the industry to create what was then known as Entity B Holdings.

“It was not until last year that the group was renamed AUM Hospitality in order to reflect the true nature of our business — hospitality,” said AUMH director Tham Lih Chung, who is in charge of the group’s finances.

Along with the rebranding, AUMH manages its brands under four divisions — Quick-Service Restaurants (The Library Coffee Bar, Quiznos Sub), Full-Service Restaurants (Johnny Rockets, Bumbu Desa, Mao Jia, The South East), Restaurants and Bars (The Library Restaurant and Bar, The Geoventure, Ichiban — The Izakaya) and Premium Concepts (Providence, Rootz, Ohla).

The move is part of AUMH’s efforts to establish itself as a comprehensive lifestyle group that provides not just food and beverage, but hospitality too.

“The Library was the group’s first home-grown brand and our flagship brand. It all started with the first outlet at The Curve, Mutiara Damansara,” he said.

The Library has come a long way in the short time since its grand opening and AUMH has since rebranded it as The Library Restaurant and Bar.

“The Library Restaurant and Bar was modelled after the British gastropub concept and as one of the first few businesses of its kind back in 2009, we noticed that others started following this concept,” said Tham.

Later in 2010, AUMH became the master franchise holder of Indonesian restaurant chain, Bumbu Desa.

Since then, the company has expanded to a total of 12 F&B and entertainment brands under their belt, nine of which they are the brand owners.

In addition to Bumbu Desa, AUMH are also the master franchise holders of US hamburger restaurant Johnny Rockets and Quiznos Sub, a US submarine sandwich franchise that recently opened their first Malaysian outlet in the 1Utama Shopping Centre in Petaling Jaya.

Riding on the success of The Library brand so far, the group also ventured into a new concept last year with the launch of The Library Coffee Bar.

The Geoventure, a restaurant and bar that was acquired by AUM Hospitality, targets an older market, opposed to many of their other businesses.
The Geoventure, a restaurant and bar that was acquired by AUM Hospitality, targets an older market, as opposed to many of their other businesses.

“We still see strong value in the name of the brand, so we decided to branch it out to a coffee bar concept that retains the ambience of The Library,” Tham added.

The venture was based in part on the fact that coffee is the second most traded commodity in the world after oil and gas. The Library Coffee Bar only uses organic and fair-trade certified coffee beans.

The move appears to have become an instant hit with Malaysians and The Library Coffee Bar is targeting the opening of its tenth outlet by the end of the year.

Tham has very high hopes for the growth of Johnny Rockets in Malaysia and this will be one of the businesses that AUMH will be focusing on in the coming year.

“As AUMH started out with a few entertainment and nightlife businesses, fun and entertainment plays a large part in all that we do, and this goes hand-in-hand with Johnny Rocket’s concept,” he said.

With more than 300 outlets worldwide already, the Johnny Rockets’ 1950s American diner concept is unusual in Malaysia.

“Ever since AUMH opened Johnny Rockets in Malaysia, profits have been very encouraging for the group,” Tham added.

A new branch was recently opened at the end of August in Sunway Pyramid mall and was declared the biggest Johnny Rockets outlet in the world with a massive floor area of more than 8,000sq ft, with another outlet due to open in Pavilion Kuala Lumpur in October.

“By utilising the brand licensing model in our businesses, we can successfully start new brands and expand existing ones at a rapid pace,” said Tham.

While similar to franchising, brand licensing differs in the sense that it gives licensees greater freedom in what they do with their businesses without changing the structure of the business.

The opening of Johnny Rockets in Avenue K, Kuala Lumpur, was very well received judging by the number of people that turned up on the opening day.
The opening of Johnny Rockets in Avenue K, Kuala Lumpur, was very well received judging by the number of people who turned up on opening day.

Thanks to this business model, AUMH has succeeded in opening more than 20 F&B outlets this year so far and they are showing no signs of slowing down.

“Our target is to have 42 or 43 outlets in total by the end of this year, which will put this year’s growth from last year at 85%.

“Next year, our target is to open 34 new outlets, especially for Johnny Rockets, The Library Coffee Bar and Quiznos Sub,” Tham added.

It has been relatively smooth sailing for AUMH so far and Tham attributes this to the commitment and professionalism of the individuals who work for the group.

He also truly believes in a high-visibility marketing strategy and uses the company’s rapid expansion to increase public awareness of its brands.

“We are also exploring the possibility of expanding overseas and we believe that through our partnership with department store company Parkson Corporation Sdn Bhd we can use their knowledge and overseas presence to our advantage,” he said.

“However, this will certainly not happen overnight as penetrating foreign markets is not easy, so we need to do proper research first,” he added.

Two AUMH brands due to open their first outlets soon are Ichiban — The Izakaya Japanese restaurant and bar at 1Utama Shopping Centre and The South East restaurant at The Curve.

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