Going beyond bakery business


Baker’s Cottage’s signature roast chicken, roast chicken meal, celebration cakes and Macau egg tarts.

HOME-GROWN Baker’s Cottage has been serving communities for the past three decades.

Best known for its range of mooncake products, this modern quick service restaurant (QSR) today offers roast chicken and set meals, on top of its signature bakery products including cakes and ice cream cakes, egg tarts as well as sausages, buns and pastries.

Following a business transformation and rebranding exercise, the chain recently opened its 100th outlet in Sitiawan, Perak –- a significant milestone in its journey to reinvent itself from a traditional bakery outfit into a QSR business.

Being the business-to-consumer channel of Leong Hup International Bhd has enabled Baker’s Cottage to benefit from the group’s “farm-to-plate” business model.

On Jan 1,2020 there were 28 Baker’s Cottage outlets in peninsular Malaysia.

Outlet expansion was ramped up during the year with an additional 67 added to the fold by the end of 2020.

Chief among the reasons for the rapid growth of Baker’s Cottage is its consumer-oriented strategy revolving around the concept of “fresh and quality everyday food at value-for-money price”, coupled with its push into semi-urban and secondary townships that are currently underserved.

This strategy has proven to be successful, as the roast chickens (now retailing at RM11.90 per bird) became a huge hit among budget-conscious consumers.

At the height of the movement control order, daily takeaway sales for its roast chickens soared to an all-time high, averaging more than 250 roast chickens per outlet per day at its peak in May 2020.

Its success was also strengthened by the increase in sales for its cakes and tarts which, together with roast chickens, are among the chain’s best-selling products.

“Our goal is simple, which is to bring reasonably-priced food products that offer both great value and taste to consumers, ” said Lau Joo Han, executive director and chief executive officer of LHI Group’s Malaysian operations.

“This is central to our core business philosophy, as we pass on savings directly to consumers due to the synergies derived from integrating the entire chain of poultry production, from farm to plate.”

On the back of the growing bottom line contribution from Baker’s Cottage, LHI remains upbeat about the chain’s growth trajectory this year and in 2022 amid signs of recovery in the economy.

Looking further ahead, Baker’s Cottage is casting its eyes within LHI’s established South-East Asian markets as it aims to spread its wings beyond home shores.

“LHI’s business-to-consumer channel has been very well-received in the Malaysian market and we believe that the same success can be equally replicated in Asean, ” said LHI executive director and group chief operating officer Datuk Lau Joo Hong.

LHI has been recognised by Frost & Sullivan Asia-Pacific Best Practices Awards in October 2020, winning the inaugural 2020 Malaysia Integrated Poultry Market Leadership Award.

“This journey marks the beginning of the group’s effort to rejuvenate itself to remain relevant in today’s competitive world.

“We will continue to work hard to realise our mission and to this end, I wish to thank our customers, suppliers and stakeholders as well as the entire LHI group family who have been firmly on board in this journey.

“I also wish to honour and dedicate this recognition in memory of my late father, Datuk Lau Bong Wong, co-founder and architect of the family’s poultry business, whose legacy continues to inspire and energise the team, ” said Joo Han.

Frost & Sullivan consultant Ng Siew Yen commented: “As a customer-centric company, LHI’s strategy of further downward integration through the expansion of its network of retail outlets, Baker’s Cottage, has bolstered the group’s presence in the business-to-consumer distribution channel.

“It has also enabled LHI to better manage the demand-supply imbalance of broiler chickens while offering customers value-for-money, ready-to-eat poultry products.”

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