How do you successfully manage a growing international company? Co-founder and chairperson of the Singaporean BreadTalk group, George Quek believes in a hands-on approach and believes that being physically present is key in navigating the often-complex puzzle that is international management. Founded in 2000, BreadTalk now has a family of 12 brands with nearly 1,000 outlets spanning across16 countries worldwide. Globally the group has over 7,000 employees and continues to grow its existing brands while adding new food and beverage brands to its roster internationally.

The multinational food and beverage corporation includes brands like BreadTalk Bakeries, Din Tai Fung restaurants, Food Republic food courts, and more.

Before 2000, the market of bakeries in East Asia was scattered and largely consisted of local small-size operations, mostly consisting of cake shops or family run bakeries with inconsistent quality of baked goods, and high perishability. George Quek saw an opportunity in an unorganized market for a common product and set up a brand that offered high-quality European style breads to East Asia on a widely available basis. The group has experienced rapid growth since 2000 and it is thanks to George Quek, who had high ambitions from the beginning, aiming to open at least 10 bakeries within the first three years of operating. BreadTalk’s rapid growth made waves in Singapore and the brand received Singapore’s prestigious Most Promising Brand award just two years into its existence, and several other accolades over the years. A sizeable portion of BreadTalk’s success and continued growth can be attributed to their expansions in international markets, with around 42 percent of revenues coming from outside of Singapore in 2018.

The 12 brands under BreadTalk’s management are present in locations are all around the world including Singapore, China, Hong Kong, Taiwan, Malaysia, Indonesia, Thailand, Myanmar, India, and the UK. However, venturing abroad was not easy. International growth creates many challenges for companies, particularly as they open and staff branch locations in different countries. Cultural differences, time differences, and simply the geographic distance can make it difficult to sustain the same management practices at home and abroad. In 2013, George Quek successfully navigated the BreadTalk group through such a minefield, after its gamble of setting up shop in China. To fulfil the group’s long-term goal of increasing direct-owned outlets in China, BreadTalk entered a joint venture agreement with franchisee Ge Ying, who managed the brand’s bakeries in the Tibetan Autonomous Region (TAR).

According to Tan Aik Peng, the Bakery division’s CEO, the agreement helped build a strong foundation for BreadTalk to enter Southwestern China markets like Yunnan and Guiyang provinces. This endeavor received the full attention of George Quek, who led the project personally and stayed in China till things were up and running, and relied heavily on the franchisee Ge Ying’s awareness of China’s culture. The experience not only increased sales and made BreadTalk into what it is today, but also gave Quek valuable insight into how to support international expansions. So BreadTalk’s gamble did eventually pay off. In 2018, the Chinese market contributed 26 percent to the group’s total revenues.

Quek has since gone on to espouse that both getting personally involved and having the right people to be in business with are invaluable in introducing a brand into a foreign market. Especially with how it allowed him to personally see to it that foreign franchisees could replicate the success of the brand domestically, and to train the managers who would be become responsible for the new outlets to be prepared to cater to cultural and social differences in new markets. In 2018, BreadTalk entered a joint venture with PT Pura Indah Berkat (PIB), which operates the Toast Box store concept in Indonesia. This joint venture married BreadTalk’s franchisee management skills with PIB’s understanding of consumer behavior in Indonesia and helped expand BreadTalk’s presence in the country.²⁷

DISCUSSION QUESTIONS

4-1. The BreadTalk group has not only established itself outside of Singapore but has also acquired several international restaurant brands. What might be the advantages and disadvantages of the hands-on approach described in the case when applied to the acquisition of an international brand?
4-2. Is the personal involvement of senior management of the business enough for a successful international expansion?
4-3. The Group’s recent expansion into the UK marked the opening of their first restaurant outside of Asia. Would the presence of senior management still be enough to tackle the issues that can arise in foreign expansion?
4-4. As the BreadTalk group is in the food and beverage industry, what special considerations might be needed in a foreign expansion that may not necessarily apply to other industries?