PETALING JAYA: After slightly over a year the bubble has burst on the bubble tea craze, but operators with a good following and product quality are still going strong amid the Covid-19 crisis.
Of the over 100 bubble tea brands registered in Malaysia as of late last year, the number is set to plunge as many lesser known brands operated by smaller concerns decide to halt business.
China bubble tea chain The Whale recently shuttered its only Malaysian outlet in SS15, Subang Jaya, to cut losses as the movement control order (MCO) was in place.
Its marketing executive Danny Ng said sales slowed even before the MCO began on March 18 and the firm sought to relocate its outlet.
“We remained closed since the MCO started, and recently decided to close as we find our next location,” he said, adding that the brand arrived in Malaysia in July last year.
SS15’s Jalan SS15/4 is popularly known as Boba Street (boba is another term for bubble tea), the epicentre of bubble tea culture in Selangor since early last year with some 20 such cafes.
Other similar examples are the suburb of Mount Austin in Johor Baru with about 30 outlets, Cheras Traders Square in Kuala Lumpur, fringes of Jalan KLJ 10 in Taman Kota Laksamana, Melaka, and Lebuh Chulia in Penang, all offering over 10 brands.
A spokesperson for local bubble tea brand Kirindo, which opened its first outlet about six months ago in SS15, said it would cease business.
It did not offer takeaways or deliveries during the MCO because of high overheads.
“Being a lesser known brand, we were worried about not being able to break even by doing takeaways or deliveries during the MCO,” he said, adding that the company had deferred its plan to open another outlet in Sandakan, Sabah, in March.
He said it was unfortunate that the company’s first foray into the food and beverage business in a bid to expand its portfolio in shoe manufacturing, consignment and licensing industry, was beaten by the pandemic.
It’s a different mix for Black Whale bubble tea, a Malaysian brand that has been enjoying brisk sales during the MCO.
Its co-founder Callie Chan said the company experienced a 20% hike in sales since the start of the MCO as it sold more drinks through deliveries and takeaways.
“Our journey began in March last year and three months later, we partnered with delivery rider firms to enable online orders.
“We have not been much affected during the MCO as we are savvy and familiar with delivery orders,” she said, adding that 40% of her total sales came via delivery.
Ng Khai Yong, the man behind bubbleteamalaysia.com, a bubble tea review and directory website, said the beverage fad began in the 1990s, where reconstituted, powdery, sugary drinks with bright colours were sold at pasar malam.
“It didn’t get much traction until the emergence of brands such as Chatime and Gongcha about 10 years ago in Malaysia.
“The bubble tea boom came in early 2019.
“We saw an influx of international brands mostly from Taiwan and China popping up all over Malaysia’s popular eating spots and malls,” he said, adding that social media too helped to fuel the craze.
Ng, who runs a digital marketing firm, said it wasn’t just the pandemic that had caused poor sales but other reasons too contributed to many brands going bust, such as the oversaturation of bubble tea shops and sub-optimal location choices.
Media officer Astrid Oh agreed, saying that the bubble was “bound to burst” as there had been too many shops – with some even having closed a few months before the MCO.
“They should lower prices to attract customers,” she said, adding that a drink should not cost more than RM8.
Business coach Gan Teck Hooi, however, is looking on the bright side.
“At least now the more inferior or inefficient players in the market are weeded out. Brands that are committed to quality products are more likely to survive the Covid-19 threat,” said Gan, 46, who has coached the operators of various F&B outlets over the years.
A bubble tea fan, Cheong Cheng Ee, in her 20s, conceded that the beverage could be addictive.
“I have to keep myself in check, more so during these difficult times.”
She counts Xing Fu Tang as among her favourites, being attracted by the shop’s decor and the extras such as free in-store games.
“I also like the tapioca balls made by Xing Fu Tang – with the right texture and firmness.”
Cheong, a hawker, is optimistic about the appeal of bubble tea.
“It is not a fad and it is here to stay. People will continue to come up with variations. At the moment, the more successful brands are those that are Instagrammable, with pictures of the decor and products readily shared on social media,” she said.
The prominent players in the bubble tea business did not respond to requests for comments.