When global brands left Malaysian consumers hanging

Customers are seen eagerly waiting at the entrance of Tim Ho Wan to taste their famous dim sum, November 28, 2014. ― Picture by Choo Choy May
Customers are seen eagerly waiting at the entrance of Tim Ho Wan to taste their famous dim sum, November 28, 2014. ― Picture by Choo Choy May

KUALA LUMPUR, July 6 ― Seeing Malaysia as an emerging market, many international brands have sought to put their footprint here, with mixed results.

Despite a promising start when Malaysians with more disposable income gained an appetite for variety through international exposure, the sombre global economy soon caught up with some of these chain companies.

The falling ringgit and the introduction of the Goods and Services Tax in the past couple of years might also have led to sluggish demand among Malaysians, inevitably leading to weaker sales.

Just last year, it was reported that 68 bank branches from 63 banking institutions have been shut down nationwide while 1,425 employees have been retrenched in half a year, although Deputy Finance Minister Datuk Othman Aziz insisted in Parliament that the economy had nothing to do with it.

Whatever the cause may be, the last few years have seen several international chain shops abruptly shut down their Malaysian businesses, resulting in grumbles among its fans and frequenters.

Here are some of the chains that have ceased operations here, gone, and perhaps to be forgotten one day:

1. Tim Ho Wan, from Hong Kong

The popular dim sum chain opened two outlets in the country ― in Mid Valley Megamall and 1Utama Shopping Mall ― to much fanfare three years ago. After all it was dubbed “the world's cheapest Michelin-star restaurant”.

In a Bursa Malaysia filing to announce the decision this week, Penang-based food and beverage company, Texchem Resources Bhd, a major shareholder of the chain’s operator, Dim Sum Delight Sdn Bhd, said the latter had incurred losses of RM895,642 in the past year.

Texchem also handles Japanese food franchises here such as Sushi King, Yoshinoya and Hanamaru Udon, and Doutor Coffee.

Tim Ho Wan still has branches in neighbouring Singapore, Thailand, and the Philippines.

2. True Fitness, from Singapore

The fitness chain announced the closure of all its gym and spa facilities in Malaysia on June 9, just a day after halting its operations in Thailand, since its business is “no longer financially viable due to evolving market conditions”.

Customers however were left high and dry since the chain did not refund those with new or existing memberships. Despite promising arrangements with CHi Fitness for those affected, the latter said there was no such agreement.

It was estimated that 10,000 members were affected from its three outlets in Jaya 33 shopping centre, Taipan Subang and Sunway Giza.

Its former employees have lodged reports with the Labour Department, accusing the gym chain of failing to pay RM66,000 in commissions. The matter was reportedly settled late last month.

Ninety people also have reported the chain to the National Consumer Complaints Centre over its sudden closure, claiming a combined loss of RM348,911.

The True Group, established in Singapore in 2004, still has branches in Taiwan and China. Its website boasts of having more than 200,000 members in total.

3. Tous Les Jours, from South Korea

In late May this year, the French-inspired Korean bakery chain suddenly announced on its Facebook page that it would close down all its stores in less than 24 hours.

No explanation was ever given, leading to confusion even among its own staff.

Several staff members had even reportedly claimed that the chain would only close for one month. The reopening never happened.

The chain opened four branches in the Klang Valley: Bangsar, Empire Damansara, WOLO Bukit Bintang, and Subang’s Empire Shopping Gallery starting from 2013 as part of the Korean coffee “invasion” that included other chains such as Dr Cafe, Caffe Bene, and Coffea Coffee.

Owned by CJ Foodville of the giant conglomerate CJ Group, it has more than 1,300 shops worldwide including in neighbouring Indonesia, the Philippines, Cambodia, and Vietnam.

4. Pumpkin Patch, from New Zealand

The children’s fashion label gradually closed its stores here this year, starting with its Mid Valley Megamall outlet in March and ending with the last one at 1Utama in May.

The decision was ostensibly due to the fate of its parent company, which fell into administration over debts of NZ$80 million (RM250 million), despite being valued at NZ$830 million at its peak in 2007.

It is believed that its rapid expansion abroad was to blame for the bust, and by 2015, all of its international stores except in Ireland and Australia were shuttered.

In Malaysia, the brand was distributed by the Wing Tai Group, and its troubles at home ultimately led to the closure of its Malaysian branches as well.

Other brands managed locally by Wing Tai include Uniqlo, Topshop, Topman, Miss Selfridge, Dorothy Perkins, Furla, and Warehouse.

5. Delifrance, from France

The French bakery and cafe chain opened in Malaysia way back in 1990, with nearly 20 outlets nationwide.

By 2016, all of them had ceased operating, and the chain had seem to just vanish into thin air.

In 2013, the chain had celebrated its 30th anniversary with a rebranding exercise in Malaysia, changing its name from Delifrance Bistro that suggested more substantial meals.

Delifrance (M) Sdn Bhd country manager Melanie Phua was even reported to have ambitiously planned to introduce five to 10 new products here, up from two to five previously.

Owned by French milling company Grands Moulins de Paris, the chain said it has hundreds of outlets in 20 countries.

6. Paris Hilton Handbags and Accessories, from the USA

The local franchise of the Hilton Hotels heiress’ namesake came here in 2008, just years after she shot to fame with her socialite counterpart Nicole Richie. That year, Hilton had started branching out into acting on top of launching her own line of accessories.

The glitzy and glamorous Kuala Lumpur launch ceremony was attended by names like Aishah Sinclair, Sazzy Falak, Chelsia Ng and Xandria Ooi.

The brand even opened several signature stores in Klang Valley, including in the upscale Pavilion Kuala Lumpur mall.

As Hilton’s shine faded, so did the brand’s lustre as a luxury item. The handbags started selling for bargain at department stores such as Parkson and Sogo. By 2014, the official Facebook page just stopped posting any new updates.

Established in 2005 by the socialite, the brand is still sold elsewhere in the world. It can still be bought here through online marketplace Lazada.

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