Time to scale Malaysian F&B brands

Emmanuel Joseph

Malaysian fast-food chain Marrybrown has over 500 branches in 15 countries, going as far south as Australia and north as Sweden, yet it is not within the top five local fast-food brands. – Facebook pic, January 10, 2024.

THE boycott of Starbucks and McDonald’s going into its third month as the conflict in the Middle East does not seem to be closing in on a resolution anytime soon.

It has been hailed as a success of sorts by the Boycott, Divestment and Sanctions (BDS) movement, and even seeing the association being sued by McDonald’s Malaysia. 

This highlights the ability of Malaysians to live without the leading coffee and fast-food brands. (Before the boycott, Starbucks’ market share was over 60% and McDonald’s around half of Malaysia’s fast-food market).

Whether or not that translates into market share increase by the other players in the market, is yet to be seen, but the trailing positions in fast food, speciality coffee and most other F&B brands are also led by foreign-run companies. Behind McDonald’s is Yum! Foods, which mostly houses foreign brands under its stable – KFC, Pizza Hut, Taco Bell and so on, while CBTL which runs Coffee Bean is the immediate second after Starbucks.

Local brands like Marrybrown and San Francisco Coffee usually come in at the bottom quarter of the graph. 

This seems like a lost opportunity given that many Malaysian brands are known worldwide leaders at multiple target segments and across many industries. 

We lead in glove and condom manufacturing and are major players in the electronic and electric segments, exporting more than even the US and Japan. 

Many of our home-grown brands are recognised as class-leading in the luxury segment – Shangri-La and Jimmy Choo, among others. 

Regionally, our banks like Maybank and budget carriers like AirAsia are among the pack leaders of Asean. 

Even with the F&B sector, brands like Kawan are known and well-positioned within the Asian ready-to-eat and frozen segment.

Similarly, we have many confection and biscuit manufacturers distributing to countries with significant Asian populations. 

Brands like Old Town and previously PappaRich, along with Secret Recipe have made inroads in Asean and Australasia, while our nasi kandar brand Pelita reverse-exported curries back to the motherland Chennai, while bak kut teh and yee sang, both Malaysian inventions, have inspired restaurants throughout the Sinosphere to offer it as well. 

So, if acceptance of Malaysian food isn’t the problem, why is fast food market so difficult to penetrate? 

After all, we have the example of Jollibee’s which not only competes on equal footing in their home ground of the Philippines, but managed to export it out to 34 countries, including the US.   

Perhaps we have yet to find the correct formula. 

In the 1990s, Malaysia tried pushing satay as a Malaysian product with semi-fast-food concept, but failed. Several attempts on “Malaysian”-ising food into more recognisable packages like bento boxes did not appear to succeed either.  

Many huge American fast-food chains did not succeed here either – Wendy’s, Grandy’s and White Castle, to name a few.  

Striking a balance between local and international tastes has been a challenge not only for these giants, but our local players as well. 

Perhaps it is a lack of local pride?  

Companies like Marrybrown have seen some success overseas already – they have over 500 branches in 15 countries, going as far south as Australia and north as Sweden, yet are not within the top five fast-food brands locally. 

As a halal hub with vast resources and a multicultural market, it should be simpler to test products as pop-ups and launch them in Malaysia.

With the global fast-food market growing, and consumer sensitivity to ethics and sentiments are causing them to seek alternatives, it could be a perfect entry point right not for Malaysia to throw more into this area to capture this current opportunity. – January 10, 2024.

* Emmanuel Joseph firmly believes that Klang is the best place on Earth, and that motivated people can do far more good than any leader with motive.

* This is the opinion of the writer or publication and does not necessarily represent the views of The Malaysian Insight. Article may be edited for brevity and clarity.

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