After many years of popularizing Taiwan’s favorite snack foods around the world, the Taiwanese food and beverage industry is expanding more and more into the international market. Already, international consumers have developed an appreciation for hot pot, pearl milk tea, shaved ice dessert, and seem to have an insatiable appetite for more Taiwanese foods.
According to the 2012 Republic of China Yearbook, there are currently 550 chain stores and restaurants in Taiwan, nearly 18 percent of them have branches overseas. Among these internationalized Taiwanese food and beverage brands, up to 81 percent have entered the mainland Chinese market, followed by Malaysia (16.7 percent), Singapore (15.6 percent), Hong Kong (14.4 percent) and Macau (10 percent).
Taiwanese stores like CoCo Fresh Tea and Juice, and Chatime, already have a strong presence in Asia. Through direct ownership, franchise, joint venture or regional licensing, they have successfully set up branches in New York, London, and Dubai.
Commonwealth monthly reported the most obvious competitive advantage for Taiwanese food and beverage vendors is diversification and innovation. “It is very common for a Taiwanese chain restaurant to provide a menu of over a hundred dishes. For beverage stores, each one can develop at least 200 to 400 remarkable tea drink recipes,” said Beryl Lee, secretary general of the Association of Service Industries, Taiwan.
Local competition also helps to beef up the skills and strength of the Taiwanese food and beverage industry. From small night market vendors to top restaurants, they have to cater to the ever changing appetite of the Taiwanese people. In addition to innovations in menu, recipes, and beverages, the high-level design of commercial space in Taiwan also plays a key role in creating a festive atmosphere, Commonwealth reported.
Gongyi Road in Taichung, central Taiwan, is legendary among Taiwan’s gourmet food lovers. The interior design of stores like Tripod King, Karuizawa, Orient Dragon, cost tens of millions of Taiwanese dollars (about US$1 million) each, demonstrating the island’s seriousness in developing a distinct food culture.
“The majority of Taiwanese food and beverage stores are concentrated in Asia. It is still very difficult for them to expand to the US,” said Chen Ming-li, manager of the Corporate Synergy Development Center. If they have no local partners, it is very hard going, especially when Taiwanese firms are unfamiliar with American regulations.
Commonwealth reported that with over 700 retail stores round the world, 85°C Bakery Café still focuses the main market in China, but the highest turnover of a single store is in Los Angeles, California. The single-day turnover of this store goes up to US$30,000, double those in China or Taiwan. “We have no immediate expansion plans and can only maintain two stores like this in the US because it is too difficult to get the work visas for the bakers,” said Chiu Chih-hong, executive vice president of the 85°C in China.
For overseas expansion, Taiwanese businesses cannot rely on innovation alone, and need to move towards systematic operation. In addition to personnel and legal regulation knowledge, Taiwanese food and beverage industry brands also need to streamline the process of internationalization and systems development. Taiwanese enterprises often stay at the standardization stage, not aware of or unwilling to invest further in developing innovative operations systems,” Lee told Commonwealth.