[KUALA LUMPUR] Coffee shop operator Zuspresso plans to open nearly 200 new stores in South-east Asia this year, after surpassing Starbucks as Malaysia’s largest coffee chain within five years of inception.
The ZUS Coffee brand owner will open at least 107 new stores in Malaysia, add about 80 in the Philippines, and another six in Singapore, said chief operating officer Venon Tian. The firm will also start its first stores in Thailand and Indonesia later this year.
ZUS overtook Starbucks as Malaysia’s largest coffee chain in early 2024. It has 743 stores in the country, while Starbucks operates 320 stores.
The US chain’s presence in the Muslim-majority nation has recently shrunk after boycotts for the brand’s perceived Israel links amid the Gaza conflict dragged down the earnings of its Malaysian operator.
ZUS currently runs about 120 stores in the Philippines – backed by an investment from Filipino billionaire Frank Lao – and four locations in Singapore. The coffee chain also operates in Brunei under a franchise model.
Tian said that ZUS finds its success in tailor-made flavours in each market it operates in – such as palm sugar-flavoured drinks in Malaysia and purple yam-flavoured coffee in the Philippines.
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The coffee chain’s rapid growth is seen in its financials, with net income rising three-fold to RM37 million (S$11 million) in 2024.
The jump in profit comes amid strong investor interest in Malaysia’s mass consumer sector. Mini-mart retail chain 99 Speed Mart Retail Holdings undertook Malaysia’s largest initial public offering (IPO) last year, while discount-store operator Eco-Shop Marketing will launch their IPO next week – which is expected to be Malaysia’s biggest listing to date this year.
ZUS started out as a kiosk focused on coffee delivery with its own mobile application in late 2019, and thrived during the pandemic when lockdowns forced people to turn to online deliveries for their daily needs.
“Covid-19 accelerated our business model,” Tian said.
The company does roughly 70 per cent of its sales online, through deliveries and pickups. ZUS’ technology-focused business model, coupled with cost optimisation in building its brick-and-mortar shops, has helped it sell coffee over 20 per cent cheaper than Starbucks, growing its mass appeal in Malaysia.
“You have got the convenience store, which sells your coffee at RM5 and below. Then you have premium mass coffee selling at RM11 and above. So ZUS positioned itself between that price point,” Tian said. “It’s about how we make quality coffee accessible to most people.” BLOOMBERG
