Zen Corporation Group Plc, the operator of Lao Yuan, a Thai chain of restaurants serving Indochinese food, is planning to open its first Lao Yuan restaurant in Europe within the next three years.
Siruwat Chatchawan, the company's chief commercial officer, said Zen has chosen to exploit a market opportunity for Lao Yuan restaurants in Europe as its first overseas venture, citing the presence of numerous Indochinese communities in Europe, coupled with the lack of a single establishment offering integrated Indochinese foods such as Lao Yuan.
"We have been exporting Tummour fermented fish sauce to Europe for the past two years and received a positive response from customers there. This indicates that opening a Lao Yuan restaurant in Europe is feasible," said Mr Siruwat.
Zen's franchise team recently introduced the Lao Yuan franchise to Europe, generating interest from several investors.
However, Mr Siruwat said while Zen's team and the brand are prepared to expand into Europe, they are awaiting the right timing in terms of improved market conditions, sustainable raw material prices, favourable locations, convenient travel options, suitable business partners as well as labour costs.
According to Mr Siruwat, the expansion into Europe would be made through a joint venture scheme and franchise system.
The firm expects to be able to open the first Lao Yuan restaurant in Europe within the next three years.
In the domestic market, Zen plans to open seven new Lao Yuan restaurants this year, bringing the total to 34 branches countrywide. Of the seven new outlets, six would operate under the franchise system, while one would be owned directly by the company. The new branches would be located in Bangkok, Rayong, Nakhon Sawan, Pattaya and Sri Racha in Chon Buri province.
"There is still untapped potential for expanding the Lao Yuan restaurant brand in the Thai market, as it is a new food segment in Asean food, with few direct competitors offering the same recipes," said Mr Siruwat.
The food business in Thailand is valued at 400 billion baht, and it's expected to grow by single digits this year.
The Lao Yuan brand was established in 2012 and became a part of the Zen Corporation Group four years later.
"For the first time in 11 years, we are repositioning ourselves to present a fresh look. This change comes as Indochinese-style food becomes increasingly popular among Thais," Mr Siruwat said.
As part of the efforts to reposition the brand, the firm has renovated three existing Lao Yuan restaurants in Rama 3, Rama 2 and Pinklao, adopting a fresh colour scheme of green and yellow, replacing the green and black format.
By the third quarter of this year, renovations to all 27 branches of Lao Yuan will have been completed.
Staff uniforms will also be revamped, and more Vietnamese dishes will be added to the menu. Zen expects Lao Yuan's sales to exceed 300 million baht in 2023, compared to 250 million baht last year.