Nineteen O One expects to maintain revenue growth

The franchisor of 1901 hotdogs expects business to show stronger growth in the next several years as the firm penetrates new markets, including the Middle East

NINETEEN O One Sdn Bhd, the worldwide franchisor of 1901 hotdogs, expects revenue growth to hold steady at 20 per cent from this year onwards as it further expands its market reach locally and abroad.

It expects to ring up RM12 million in revenue in 2007 from its 15 direct-managed outlets, up from some RM10 million in 2006.

Nineteen O One, which has been growing by an average of 34 per cent since its inception in 1997, suffered a minor setback since 2005 due to changes in the market and higher prices of oil and raw materials.

Its executive director Ahmad Zakir Ja'afar, however, expects business to show stronger growth in the next several years as the firm aggressively penetrates new markets in the region, including the Middle East and other countries in Asia.

"We were in a different league before and the firm was smaller, but now as we grow bigger and cater for a bigger market, we are ready to adapt to the changes," he told Business Times in Petaling Jaya recently.

Zakir said the firm plans to expand its 1901 franchise in the Middle East and countries such as China and Thailand in the next 12 to 24 months as it believes there is strong demand for halal food.

He said the firm expects growth for 2008 to be evenly contributed from existing and new outlets.

Zakir said to further strengthen the 1901 franchise in both Malaysia and overseas, the firm expects to open at least 11 new outlets this year.

"We plan to open at least eight additional outlets in Malaysia out of the 74 we have now and open two more in Singapore and one in Jakarta by year-end," he said.

Zakir said currently there are three 1901 outlets each in Singapore and Indonesia. "Out of the eight new outlets in Malaysia, six will be run by our franchisees and the rest directly managed by the company," he said.

Of the 74 existing outlets, 15 are managed by Nineteen O One while the rest are franchisees.

Its outlets are currently located in the Klang Valley, Penang, Malacca, Selangor, Johor and Sabah.

"We recently secured locations in Kedah and Terengganu. Our outlet in Miri, Sarawak, will be operational in April," he said.

As for plans to penetrate the Middle East market, Zakir said the firm has signed a memorandum of understanding with a party there to be its potential master franchisee.

"We are actually in talks with several parties there, but one has shown keen interest. We hope to conclude the deal soon and open the first 1901 outlet there by the fourth quarter of this year," he said.