Sunday 25 February 2024

U.S. bakery chain Au Bon Pain plans major expansion into Indochina

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BANGKOK, Thailand – The Au Bon Pain bakery chain is to expand into Cambodia, Laos, Myanmar and Vietnam by the end of the year, to serve growing middle classes in the region.

The expansion was announced by Mudman Plc, the authorised Thai franchisee of the Au Bon Pain bakery chain, and international retail food brands including Baskin Robbins and Dunkin’ Donuts.

The firm said the development is intended to capitalise on increasing consumer purchasing power and the strong economies in the Cambodia, Laos, Myanmar and Vietnam (CLMV) market.

Nadim Xavier Salhani, chief executive of Mudman, was quoted in the Bangkok Post as saying the company recently won rights from ABP Corporation, the owner of Au Bon Pain in the US, to open branches of the bakery in the CLMV market.

“The company is considering forming a joint venture with local partners or investing on its own in CLMV. The investment model will be finalised by year-end, while the expansion of Au Bon Pain bakery chain into the CLMV market reflects the market’s potential.” Mr Salhani said.

“Mudman expects to open the first Au Bon Pain branch in Cambodia or Vietnam by the end of this year or next.”

Express Food Group general manager Virak Tep told Khmer Times there is plenty of room for coffee and bakery chains to expand into the Cambodian market.

He added that many international brands are entering into Cambodia, with the notable exception of McDonald’s.

“I think Au Bon Pain is a good brand and with strong potential for a franchiser who wishes to bring it to Cambodia,” Mr Virak said.

Mr Salhani said purchasing power is increasing due to economic stability and growth in the CLMV, while international brands are popular among younger people.

Sales volumes in the food and beverage sector in Cambodia is rising at about 10 percent year-on-year, attracting many international franchises, according to Mr Virak.

“Cambodian consumer trends show increasing preference for international brands from Thailand, Korea, Vietnam, Singapore, Malaysia and the US. As long as the taste of the food or drink meets their expectations, they will go for those brands,” Mr Virak said.

He added his company will open another outlet of the chain restaurant Bar B Q Plaza in Cambodia by the end of this year.

Hem Samnang, area manager of BreadTalk Cambodia, a franchise brand from Singapore, agreed that coffee and bakery chains have room to grow in Cambodia. He said consumer awareness of international brands has been getting better over the past decade, as peoples’ incomes have gone up.

“Purchasing power in cafes and bakeries is rising day by day, both among youths, middle-aged people and families,” Mr Samnang said. “Cambodia still has more opportunities for international brands to enter the market as the country’s GDP is rising.”

Mr Samnang added: “I cannot say Au Bon Pain will be my competitor until I see their products.


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