SugarBun making waves Down Under

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Sugar Bun cover facade

People and businesses of Malaysian origin have become more prominent on the global stage. Names like Penny Wong, Michelle Yeoh, Robert Kuok and Jimmy Choo are internationally recognised. There have even been Malaysian companies who were able to engineer reverse takeovers of European-based companies, such as German stationery manufacturer Pelikan. And more recently, Malaysian food outlets are beginning to make their presence felt in First World markets.

East Malaysian fast food chain SugarBun, a division of Borneo Oil Company, aims to become one of the first few truly Malaysian food icons to successfully make the jump into the Western market, opening its first outlet in Australia in the Melbourne CBD (central business district) in August 2013. Prior to that, however, it had already been expanding regionally within Asia.

Fiorn and Francesca Lee

According to Sabahan Fiorn Lee (pic – left, with sister Francesca), manager of the outlet, the decision to expand to Australia was less strategy and more serendipity.

“During our studies here, my sister and I noticed that while there were a number of outlets offering Malaysian cuisine, none offered East Malaysian food. So we were already predisposed to consider the idea of opening an East Malaysian eatery.

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“Then in 2010, the family managed to acquire the building (where SugarBun is presently located – pic). Between the discussions on what we were to do with the building, and what the future held for SugarBun, it was decided to attempt the international expansion,” she explained.

SugarBun established itself in Kuching, Sarawak back in the early 80s as a bakery and ice creamery.

Prior to being bought by the twins’ visionary father in the early 1990s, it had also branched out to selling burgers, broasted chicken and popcorn, establishing itself as a cinema concessionaire. Following the buyout, SugarBun introduced several Asian dishes, turning itself into a fusion food outlet chain.

Up to 2004, SugarBun’s outlets were mostly self-managed (the company hired management teams to run the outlets). Following a rough period where mismanagement on the outlet level was rife, SugarBun decided to convert fully into a franchise model in 2009. “Only a few outlets remain management-owned, primarily for training purposes,” Fiorn clarified.

Rising above the challenges

Fiorn revealed that SugarBun’s expansion into Australia was not without its challenges. Neither of the twins were trained or studied in business and management; Francesca having majored in nursing and Fiorn in architecture, so both of them, as co-managers of the outlet, had to learn on the job.

In addition, as Fiorn explained, actually making SugarBun’s culinary items was also non-trivial. “Getting all of our ingredient mixes and spices from Sarawak means we have to ship them in. Meanwhile, we had to source for local ingredients, which sometimes did not taste the same. We had to tweak our recipes to suit the local taste buds and rebuild our menu in line with market expectations as well.”

It was this that led to SugarBun’s decision to create its Nanyang subsidiary brand, which included the Chinese claypot dishes sold in SugarBun’s Melbourne outlet.

“Our claypot dishes are made fresh daily, and we also offer a dry version, which no one else is doing either,” she highlighted.

These dishes, some of which are exclusive to the international arena and not available in Malaysia, have become quite popular.

What greatly helped was a write-up in The Age on SugarBun, which introduced its claypot dishes to many people who came to try it out… they in turn became regular customers!

“About half of our clientele are Malaysians and Singaporeans, but the mainland Chinese are catching on, and even some Australians,” Fiorn enthused. “These days, our customers come from all walks of life.”

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While its Melbourne flagship outlet remains self-managed, SugarBun is in the process of bringing consultants aboard to build a franchising model suitable for the Australian market.

“The Malaysian franchising laws and Australian ones are slightly different, so we want to make sure we have it right before offering it,” Fiorn said, adding that they have already received several franchising inquiries.

SugarBun intends to open further outlets in the state of Victoria, especially in the heavily-Malaysian suburb of Glen Waverley and the foodie haven of Fitzroy, before moving on to New South Wales and Queensland over the next 2 years.

For those Malaysians intending to expand internationally, Fiorn advises that they conduct their market research into their prospective markets prior to opening their flagship outlets, but to remain flexible and sensitive to market demands on an ongoing basis.

“It is also critical to have adequate capital and financial reserves; at least 3 years’ worth, if not more, as it may take that long before the business starts becoming profitable and getting into the black,” she added.

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