Top-end restaurant to spread its wings abroad

BEIJING - Lovers of Chinese food in New York - especially those hankering for authentic Sichuan cuisine - may be able to dine on that food in their own city by the end of the year.

South Beauty, one of China's top restaurant chains, is planning to head overseas and establish outlets in either New York or London.

CEO Rebecca Wei said the chain is preparing for its overseas expansion.

"We don't have a clear plan about how many branches we're going to open overseas in the near future, but it is certain that South Beauty will open its first overseas branch in 2011," Wei said.

"Our mission is to promote Chinese cuisine's image in the global market."

Founded in 2000 with its headquarters in Beijing, South Beauty Group Ltd is best known in China for its innovative fusion style of authentic Sichuan food.

The group has two high quality brands, South Beauty Restaurants and the STEAM club style restaurant, with 38 restaurants in cities including Beijing and Shanghai.

Lan club, a high-end club and restaurant established by the group in 2006, has also won praise from international dignitaries, including British Prime Minister David Cameron and golfer Tiger Woods.

Wei said the group targets people with high disposable incomes who want high-end services. And for its overseas foray, the company has decided to target a similar group.

Wei said there would need to be a certain amount of localization for the company to flourish abroad, including staff and ingredients from the area.

One problem Chinese restaurants abroad face is the lack of traditional ingredients, including availability. For example, some Sichuan peppercorns used in Sichuan cuisine were banned in the United States unitil 2005.

Wei said South Beauty has taken that into account, and expects to alter menus based on what is available, as well as morph some items to accommodate local tastes while trying to preserve the unique original flavor of Sichuan cooking.

However, an overseas expansion for Chinese restaurants is still a gamble. Chinese cuisine has the image of being fast food or take out.

South Beauty is also not the first Chinese food brand to head abroad, but many which have tried before it have either failed or withdrawn.

Wei said one difficulty is that the domestic market offers higher returns and lower costs than foreign ones, and it is discouraging. However, she believes South Beauty is ready and that enhancing the brand requires expanding beyond China.

"We spoke to Little Sheep, which went overseas a while ago, to learn what it did and it said one of things it regretted when it entered the US market was franchising its brand," Wei said.

"It ended up withdrawing from overseas. We are learning from those mistakes and are looking at our options more carefully, be it direct ownership of our brand by ourselves or controlled franchising."

Little Sheep, a Chinese hotpot company, entered the US market in 2005, only to separate its US brand from its main company in late 2009.

A Little Sheep spokesperson declined to comment as to why it withdrew its mainland support from its US stores.

However, Wei is confident South Beauty will do well abroad, citing the reception it received from foreigners during the 2008 Beijing Olympics and the 2010 Shanghai World Expo.

Wei said the international events have given South Beauty the confidence for going overseas.

"There are many Chinese restaurants abroad which copy our menu and have flourished overseas," Wei said.

"If they can make a living copying us, then there is no reason why we can't establish our brand overseas ourselves."

China Daily

(China Daily 02/11/2011 page15)