KUALA LUMPUR: The livelihood of over 1,000 workers is at stake with the premature termination of the Chatime franchise by franchisor La Kaffa International Co. Ltd. of Taiwan.
Master franchisee for Malaysia, Loob Holding Sdn Bhd, said in a statement today that the fate of their employees is topmost on the minds of the management at the moment.
Chief Executive Officer Bryan Loo said the company is committed to looking after the welfare of all staff whose livelihoods depend on the 165 outlets run by Loob Holding in Malaysia.
"While we seek legal advice to protect our legitimate rights and interests under the franchise agreement, which only runs out in 2041, we are very much concerned over what will happen to these 1,000-over workers and their dependents.
"On top of that, as a reputable food and beverage company, we also want to make sure that the two million consumers we serve every month are not let down," he said.
Loo said the company's management and supervisory staff have been closely liaising with all its outlet workers to assure them that their livelihoods would be protected.
"We have lodged a police report against La Kaffa for the sudden termination and we will let the authorities take the necessary action according to the law.
"Right now, we are operating as usual, and all our workers and sub-franchisees are assured of continued employment and consumers can continue to enjoy our offerings.
"Our team is in close consultations with the workers, partners and associates to work out a common future for all of us," he added.
Loo called on Malaysian consumers to continue supporting the outlets while awaiting the outcome of this dispute.
Of the 165 outlets, over 100 are owned and operated by Loob Holding and the rest are operated by sub-franchisees.
The dispute between the franchisor and the master franchisee came out into the open when La Kaffa announced at a press conference on Jan 6 that it has terminated the franchise and would immediately take over all 165 Chatime outlets in Malaysia.
"Although our agreement with them still has 24 years to go, they had unilaterally served us a termination letter on Jan 5.
"It also appears to us that, based on what was reported from the press conference of Jan 6, they already had the intention of taking back the franchise from early last year," Loo added.
He said there had been disagreements and disputes over various business and operational matters, but these were all dealt with in accordance with the terms of the franchise agreement.