RTG Holdings, the franchisee of Taiwanese bubble tea franchise Gong Cha in Singapore has announced its move to replace all 80 Gong Cha outlets in the country to local bubble tea brand LiHo, which means “How are you?” in Hokkien.
According to The Straits Times, the man who introduced the popular brand to Singapore, Rodney Tang, has already converted more than 30 outlets to his very own homegrown brand, and the remaining outlets are expected to follow suit by 5 June 2017.
|(Photo source: straitstimes.com)|
The decision was made after the company decided not to extend its agreement with franchisor Royal Tea Taiwan, who sold its business to Gong Cha Korea, which is owned by a Japanese private equity firm known as Unison Capital.
“Our agreement to operate Gong Cha in Singapore expired on Dec 31 last year, and they proposed an extension. We were more than happy to do so. I saw no reason not to extend,” he said as quoted.
But after discovering that the franchisor company has been sold off, which resulted in a change in contractual terms that seem to be more restrictive, Tang decided to create his own brand instead of abiding the new terms.
LiHo will rely on completely different suppliers for its tea and other raw ingredients, and it will use different methods of making its drinks.
|(Photo source: fb.com/lihosg)|
“Tea is tea – there is only so much I can do to make it different. But we are introducing drinks such as cheese tea and smoothies,” Tang said.
Introduced in Singapore in 2009, Gong Cha has raked in an annual revenue of SGD30 million, and is by far the biggest brand that RTG Holdings has ever managed.
(Main photo sources: eatbook.sg, fb.com/gongchamy)