Ho Wan slows expansion to build systems

Dim sum chain delays faster market entry until processes are scalable.

Tim Ho Wan is deliberately holding back on rapid global expansion as it focuses on building systems and processes it believes are critical for sustainable growth, according to Sheng Lee, CEO of Tim Ho Wan.

Despite operating only one restaurant in Australia, Lee said the market remains a priority. “Australia is one market that we do believe there's strong opportunities,” he said. However, expansion is being paced to ensure the business can scale consistently. “It goes back to what I was actually mentioning, to build sustainable and replicable systems and processes,” Lee said.

The brand has spent the past year strengthening its operational foundation, and Lee said that he is “quite optimistic that over the next 12-18 months, when the systems and processes are strong, it becomes a lot easier to actually expand and replicate.”

Lee said Australia could move much faster once those fundamentals are in place. “With the right systems and processes, we would be ready to actually move at a much faster pace,” he said.

Proof of concept is another gating factor. Lee pointed to recent store openings as validation. “The recent stores that we've opened have actually proved to actually be financially attractive,” he said. Those results are now informing future decisions. “Now that we actually have these learnings, we would actually start replicating into the other markets,” Lee added.

Some of the delay, he acknowledged, was unavoidable. “Some of it is just a function of time, because we needed the time to build the systems and processes,” he said. “We needed the time to actually build the stores as a proof of concept.”

Looking ahead, Lee said expansion decisions will be shaped by broader industry pressures. “One of the key things that consumers are looking for would actually be value,” he said. “It's not really about looking for cheap quality products. But it's good quality products at great prices.”