Taco Bell operator keen on CLMV market

Taco Bell operator keen on CLMV market

Mr Chalermchai (left) and Mr Tuli attend the launch of the Naked Chicken Taco. The Thai franchisee aims to bring Taco Bell to nearby countries. (Photo by Pitsinee Jitpleecheep)
Mr Chalermchai (left) and Mr Tuli attend the launch of the Naked Chicken Taco. The Thai franchisee aims to bring Taco Bell to nearby countries. (Photo by Pitsinee Jitpleecheep)

Siam Taco Co, the franchise partner of Taco Bell, the American fast-food restaurant, is in talks with the US franchiser for the right to expand the chain in the region.

Chalermchai Mahagitsiri, the company's director, said the company wants to open Taco Bell restaurants in the CLMV (Cambodia, Laos, Myanmar, Vietnam) region, where the market potential is huge.

Siam Taco is a joint venture of SET-listed Thoresen Thai Agencies and CM Capital, owned by the Mahagitsiri family.

The company last year was awarded the right to operate Taco Bell restaurants in Thailand, with the first store opening in January on the first floor of Mercury Ville mall opposite the Central Chidlom complex.

Thailand is the second country in Asean to open a Taco Bell, after the Philippines.

Ankush Tuli, managing director of Taco Bell Asia-Pacific and Middle East, said expansion talks are underway and have yet to reach a conclusion.

"It is possible in the future, but at present we just want to put more focus on Thailand, which is one of our most successful markets in the world," Mr Tuli said. "Thailand and Asia-Pacific will be key sales contributor to Taco Bell worldwide in the future, and Taco Bell will also be a key growth brand for Yum Brands."

Taco Bell contributes 15% of parent Yum's sales. The chain's sales reached US$11 billion in 2018.

There are more than 7,000 Taco Bell restaurants in the US and 580 in 30 other countries, including 11 Asia-Pacific nations.

New restaurants are scheduled to open in Indonesia and Malaysia next year.

"Asia-Pacific will be our big growth driver because about two-thirds of the global population comes from this region," Mr Tuli said. "We've also seen continuous growth from KFC, Yum's sister brand, in Thailand, India and China, despite the trade dispute."

There are four Taco Bell restaurants in Bangkok, at Mercury Ville, Siam Paragon, Central Pinklao and Samyan Mitrtown. A fifth will open at CentralPlaza Westgate this weekend.

Mr Chalermchai said Siam Taco plans to open five more Taco Bell restaurants in Bangkok and major cities. Each stores requires an investment of 10 million baht. The number of restaurants is expected to reach 40 within the next five years.

"We will continue to open our restaurants next year, though we started to get an impact from slowing consumer purchasing power in this quarter," Mr Chalermchai said. "We will manage operating costs carefully and offer new food innovation to customers."

Based on demographics, Thailand has huge potential for Taco Bell's business, Mr Tuli said. The brand is younger than other quick-service restaurant brands, and the company's strategy is focused on social media.

Moreover, it has no direct competitors in the Mexican-style fast-food segment.

"Thailand is full of foreign tourists who are familiar with Taco Bell," Mr Tuli said. "This is the right time for Taco Bell to expand here."

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