Old Chang Kee
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Old Chang Kee is a food retail chain best known for its Hainanese-style curry puffs, which were first sold in 1956. The business was bought over and revamped in 1986, and has since expanded to a chain of over 70 outlets in Singapore located in shopping malls, petrol stations and other high-traffic areas. Its menu includes mostly takeaway deep-fried snacks, as well as quick dine-in meals at selected cafes. The chain sells more than 40,000 curry puffs daily. Old Chang Kee is also present in Malaysia, Indonesia and China, and is listed on the Singapore Exchange.
Hainanese immigrant Chang Chuan Boo set up his first stall at Koek Road in 1956 selling the curry puffs that later became famous. He then moved his stall to Albert Street, which was renown for its hawker stalls until the 1980s. In 1973, Chang opened a second stall at a coffee shop on Mackenzie Road, near the Rex Cinema, where the curry puffs were very popular and became known as the the “Old Chang Kee” or “Rex” curry puffs. At their peak, it was estimated that the stalls sold some 700 curry puffs a day. Made of fried chicken, curried potatoes, herbs and spices encased within a buttered and fried pastry, each puff cost 35 cents in 1981.
In 1986, Chang retired from the business and decided to return to China. A small group of investors led by Han Keen Juan, who had met Chang through the Hainanese Association, bought the stall at Mackenzie Road for S$30,000 and invested a further S$40,000 as working capital. Han decided that the business needed to be revamped and engaged an advertising agency, which designed a new logo and came up with the tagline “Old Chang Kee - it’s a better puff”. The decision to work with an advertising agency prompted four shareholders to pull out, leaving Han and his cousin Bugs Tan. A minor investor, Han’s nephew William Lim, put in S$5,000 and later became the company’s chief executive officer.
A former salesman and marketing manager, Han faced a number of difficulties at the beginning, including a rental hike from S$600 to S$3,000 a month and the departure of the chief chef within a year. Sales of around 700 puffs daily at 40 cents each also did not bring in enough revenue for expansion. Han realised that gradual expansion was needed and opened a second outlet at the Lau Pa Sat market at Shenton Way. Han and Tan also standardised the recipe, preparation and cooking processes for the puffs, and travelled to India and Sri Lanka to learn about spices.
Expansion and overseas franchises
By 1991, Old Chang Kee had 12 outlets around Singapore and sales turnover had gone from S$700,000 in 1987 to S$1.6 million in 1991. A factory at Ubi Avenue utilised mechanised dough mixers and potato peelers, turning out more than 10,000 curry puffs each day. Han also won the Small Scale Entrepreneur Award in 1992.
In 1993, Old Chang Kee opened its first overseas franchise outlets in Malaysia, Indonesia, China and Japan featuring the slogan “A taste of Singapore”. A factory in South Africa and distribution to taverns and supermarkets there followed in 1994. Expansion abroad was rapid, with 20 outlets in Indonesia and 10 in Malaysia by the end of the first year of their foray overseas and sales in each market passing the S$1 million mark. In Japan, Old Chang Kee puffs were distributed through coffee house chains, leisure destinations and vending machines at the rate of hundreds of thousands each month. By 1996, there were 30 franchised outlets in Malaysia, Indonesia, South Africa, China, Japan, India and New Zealand. In Singapore, Old Chang Kee produced curry puffs at a 20,000 square foot factory in Woodlands and sold between 12,000 to 16,000 puffs daily at its 20 retail outlets.
However, business at the overseas franchises eventually declined. There were complaints about the quality and consistency of the puffs, and the franchise outlets became unprofitable. Han decided to terminate all 24 overseas franchises in 2002 at a loss of about S$50,000. By contrast, the Old Chang Kee brand remained strong in Singapore, and the company racked up S$14 million in sales in 2002.
Diversification and re-expansion overseas
Han’s nephew William Lim joined the company in 1995 and became Old Chang Kee’s managing director in 2003. Lim increased the number of outlets to 40 by 2005, with half of these having been opened within the previous two years. The menu was also expanded to include other fried items such as chicken wings, fish balls and nuggets, and a delivery service as well as a fast food cafe concept called OCK Take 5 was introduced. A research and development team was given the task of coming up with a new product every three months, and the company attained halal certification. The company’s turnover reached S$20 million in 2004.
In 2005, Old Chang Kee re-entered overseas markets with stricter controls for foreign franchises. Three factories in Malaysia and Thailand were opened to maintain the quality of the curry puffs, and retail outlets were opened in Malaysia, Indonesia and the Philippines. To maintain freshness and taste, the puffs were manufactured at the factories then fried at the various outlets. By 2008, there were 54 outlets in Singapore, two in Kuala Lumpur, four in Indonesia, and two in Manila.
In 2007, the company introduced a baked food brand named Pie Kia, offering savoury and sweet pies and other snacks through a franchise system.
The following year, Old Chang Kee listed on the Singapore Exchange’s Catalist board with an Initial Public Offering of 25 million new shares at 20 cents each. IPO proceeds of around S$5 million were earmarked to fund expansion in Australia and China, increase and refurbish outlets in Singapore, and for strategic alliances and tie-ups.
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(Call no.: RSING 959.57003 SIN - [HIS])
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The information in this article is valid as at 2010 and correct as far as we are able to ascertain from our sources. It is not intended to be an exhaustive or complete history of the subject. Please contact the Library for further reading materials on the topic.
Snack food industry--Singapore
Business, finance and industry>>Industry>>Manufacturing industries>>Food, beverages and tobacco
Cookery>>International and regional cooking>>Southeast Asian