While celebrating its 20th anniversary, Canadian burger chain Triple O’s announced its plans of further expansion in Asia, including the opening of 4 additional outlets in Hong Kong. Since its arrival in Hong Kong 2004, Triple O’s has already opened 6 shops and these shops demonstrated notable growth and revenue. Triple O’s franchisee Cynthia Suen initial decision of expanding into Hong Kong was prompted by the large numbers of Hong Kong residents that traveled to, or stayed in Vancouver since the 1980s. The high revenue reports from Hong Kong outlets has proven Suen’s decision to be profitable. In fact, Triple O’s president Warren Erhart stated that “Asia has some of our top locations. Our restaurants in Pacific Place and Shatin do more sales on a per-unit basis than any of our stores in British Columbia”.
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However, an increasing number of burger chains with a value proposition similar to that of Triple O’s – an emphasis on ‘quality burgers’, are beginning to expand into Asia, increasing the competition Triple O’s will face. Shake Shack has announced its plans to open its first Hong Kong outlet in 2018 and complete a total of 14 outlets by 2027. Although Triple O’s have the advantage of high brand recognition in Hong Kong, the entry of companies like Shake Shack will bring threats to Triple O’s by providing more substitutes.
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Foreign markets in many cases are similar to a big pie, and with more players the difficulty of securing a large piece will become increasing difficult. Preksha Singhvee’s blog on international business provides insight into this issue by suggesting how additional market research may be required to understand the new set of consumers with somewhat different values and experiences. Additionally, Singhvee’s blog noted that international expansion often involved the redesigning of good or services, which aimed to target this new consumer segment with different culture and taste preferences. This strategy is used by many burger chains including Shake Shack, who plans to increase the variety of chicken products offered in their Hong Kong outlets. In contrast, Triple O’s did not, and does not plan to adjust its menu or flavours to fit the preferences of the Hong Kong market. Although Triple O’s has seen significant success in its Hong Kong outlets, with increasing competition, it may need to reconsider its points of different to stand out from the variety of burger chains.
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