KUALA LUMPUR (Sept 29): AirAsia Group is targeting to open about 100 Santan franchise stores in Malaysia and abroad by the first quarter of 2022, in addition to the 15 stores it currently owns.
Group chief executive officer (CEO) Tan Sri Tony Fernandes said with the brand's rapid expansion, Santan's contribution to group earnings was expected to increase to 10% to 15% in the next three years from about two per cent as an inflight restaurant currently.
Santan general manager Catherine Goh (pictured) said Santan, the world's first restaurant brand to offer inflight food on ground, was set for a rapid expansion in Malaysia with a minimum franchise fee of RM50,000 based on the size of the store.
“Currently the franchise stores are about 1,000 sq ft (92.9 sq metres) and below, and locations that we would choose are those with high footfall and which also cover a good delivery radius,” he told reporters after the official franchise registration certificate presentation here today.
The certificate was presented by Domestic Trade and Consumer Affairs Minister Datuk Alexander Nanta Linggi and witnessed by his deputy Datuk Rosol Wahid, AirAsia Group executive chairman Datuk Kamarudin Meranun and Fernandes.
Goh said the Santan franchise brand received tremendous response, with about 1,000 applications received so far, and another five outlets were expected to be opened by year-end, providing hundreds of jobs from kitchen assistants to management staff.
“This year, we are focusing on expansion within the Klang Valley to create brand awareness and as a springboard for Santan to spread its network across Malaysia.
“We are confident that the number of restaurants would hit the 100-mark by Q1, 2022, with the first outlet in East Malaysia targeted to open in Q1 2021, “ she said.
Goh said the group was also gearing up to expand abroad, targeting to open stores in China and the United Kingdom next year.
She said in line with the Buy Malaysia Products Campaign, Santan had established Santan Food, a specially curated space at its flagship outlet in Mid Valley Megamall, to highlight the best of Malaysian products which include locally made and sourced snacks, coffee and tea.
She added that Santan had sold about 300,000 Malaysian products in its outlets.
Meanwhile, Nanta in his speech said with the ease of doing business under the franchise model, it was hoped that more entrepreneurs would take up the opportunities and hence boost the franchise business, which was valued at RM13 billion in 2019 and expected to double by 2025.
He said Santan was one of Malaysia’s homegrown local businesses that had thrived even during these challenging times amid the Covid-19 pandemic, proving that the business model was sustainable.
“We hope more local entrepreneurs will take up the franchise opportunity with Santan, which will not only boost local franchise businesses but increase franchise sales value by 2025.
Nanta said the expansion of Santan in Malaysia would further support the government’s Buy Malaysian Products Campaign, which is aimed at promoting local products and boosting the domestic economy by encouraging consumers to prioritise the purchase of locally made products.
He said the campaign, launched in July this year, played an integral role in recovering the nation’s economy and the government had set a high sales target of RM513 million.
“With the rapid expansion of the Santan franchise outlets and others, it is hoped this would help in achieving the ministry’s target,” he added.