Lotteria, a Korean hamburger franchise that opened in Korea in 1979, is focusing on expanding to overseas markets. The company is considering entering neighboring Singapore and Malaysia to capitalize on its success in the Vietnamese market where the Korean hamburger giant has enjoyed significant growth in recent years.
According to industry sources, CEO Cha Woo-cheol and members of the New Business Team of Lotte GRS recently visited Singapore and Malaysia to understand the current status of local hamburger franchise stores and study the feasibility of business in the region.
Lotteria is the first Korean hamburger franchise to expand overseas. Starting with China in 1994, it opened stores in seven countries (Vietnam in 1998, Myanmar in 2013, Cambodia in 2014, Kazakhstan in 2015, Laos in 2016, and Mongolia in 2018). However, the Chinese subsidiary was finally shut down in 2018 so Lotteria is now present in only six countries.
The most successful country has been Vietnam. There, Lotteria has 246 stores, more than any other country. It has more local stores than global hamburger brands such as McDonald’s and Burger King.
Sales in Vietnam have also soared. According to Lotte GRS, Lotteria Vietnam’s sales reached 108.1 billion won (US$81.20 million) in 2022, helping Lotteria to rack up over 100 billion won in annual sales for the first time in its 24 years since opening its first store in the country.
Lotte GRS aims to operate 400 Lotteria stores and achieve annual sales of 200 billion won in Vietnam by 2027.
Unlike Vietnam, which has a high proportion of directly operated stores, Lotteria has master franchise (MF) agreements with local companies and receives royalties in Myanmar (40 stores), Cambodia (4), and Laos (5).
In Singapore and Malaysia, new markets where Lotteria is considering entering, MF contracts with local companies are expected.
Source : Business Korea