NEO SUKI TO OPEN CHINA FRANCHISE

       Neo Suki Thai Restaurants has returned to the Chinese market with a plan to have three franchises up and running in Guangzhou next year.
       The company recently signed a Memorandum of Understanding (Mou) with Feed Master Group (China) to be its franchisee in the country, managing director Skon Kubpiyajanya said last week.
       Neo Suki will co-invest with Feed Master Group in each Neo Suki restaurant, contributing 20 to 25 per cent. It will receive a share of the revenue from each restaurant equivalent to the ivestment stake, as well as a franchise fee.
       This is the first time that Feed Master Group, whose primary business is manufacturing animal feed, has diversified into another food business. The firm approached Neo Suki a few months ago about buying franchises.
       Skon said he had a chance to talk with Feed Master executives as part of a delegation accompanying Prime Minister Abhisit Vejjajiva on a visit to Guangzhou last month, and clinched the deal during the trip. Abhisit was a guest of honour at the MoU signing ceremony at Impact Muang Thong Thani last week.
       "Our partner is looking for a location for the first Neo Suki restaurant, and is hoping to lease space in the Grand Ville shopping mall in the centre of Guangzhou. The first branch, which will likely require an investment budget of 2 million yuan [Bt10 million], is expected to open by the end of this year. We want to have three branches open by the end of next year," he said.
       Skon said Guangzhou was a good city in which to launch its suki restaurants as it will host the Asian Games next year. It is also major tourist destination whose service businesses, including restaurants, have enjoyed strong growth, he said.
       Neo Suki opened a branch in Bejing in 2005 - the first suki restaurant in China - with a local partner. The venture failed, however, and Neo Suki withdrew its investment after six months.
       "I've learned that it is not easy to get into the restaurant business in China, which is quite complicated for foreign investors. The first time, we co-invested with a local partner. Experience has shown me that it would be better to expand using the franchise model and let the local partner, who knows Chinese culture well, take full responsibility for operating the restaurant. I'm absolutely confident we won't fail this time," he said.
       The firm plans to expand the Neo Suki chain to Xiamen and other tourism destinations in mainland China, Skon said.