Muslim entrepreneurs eye foreign food franchises with government support

By Zhang Yu Source:Global Times Published: 2017/2/23 19:08:39

Hualong Muslims have opened over 14,000 lamian restaurants across China

Many entrepreneurs are trying to turn their restaurants into franchises

Some of them are looking to open locations in Malaysia, Indonesia, encouraged by the Belt and Road initiative

Jia Haiwu's lamian restaurant in Kuala Lumpur is ready for business. Photo: Courtesy of Jia Haiwu

Jia Haiwu, a Muslim entrepreneur hailing from the Hualong Hui Autonomous County in Northeast China's Qinghai Province, has seen his dream come true.

His company's first lamian (hand-pulled noodle) restaurant abroad will open on April 7 in Kuala Lumpur, Malaysia. Located in a commercial area in the city center, his new place has 400 square meters of floor space and a modern décor with walls depicting the scenery of the ancient Silk Road.

This will be their first restaurant in Malaysia. Sites for four more restaurants in the country have already been chosen, and are all scheduled to open within the year.

Like Jia, more and more Muslim lamian restaurant owners are now expanding their businesses to Muslim-majority countries that are involved in the Belt and Road initiatives such as Malaysia and Indonesia, driven by their entrepreneurial spirit and government support. With this encouragement, they are eyeing business opportunities among others of their faith.

Going modern

Lanzhou lamian, from the capital of Gansu Province, Lanzhou, enjoys nationwide fame in China and can be found in every neighborhood. But not many people know that the majority the restaurants that have "Lanzhou" in their names actually trace their origins to remote Hualong, a small Muslim-majority county with a registered population of 300,000.

Since the late 1980s, with support from the county government, people from Hualong have opened beef noodle restaurants across China. In order to attract customers, they named their eateries after the more famous city, and their solidarity and entrepreneurship soon led to nationwide success.

Today, Hualong people have opened over 14,000 lamian restaurants in over 270 cities across China. According to the county's vice head Ma Qianli, a third of the county's 300,000 people now work in lamian businesses, earning a profit of more than 1.8 billion yuan ($262 million) each year, according to the Xinhua News Agency.

But not every lamian restaurateur from Hualong is satisfied with the state of the industry. "Most of these restaurants are family businesses, and even though they've been growing in scale over the past 30 years, the majority of them are still small street-side affairs with very backward management," Ma Qingyun, head of Qinghai's lamian service center which helps guide and educate entrepreneurs, told the Global Times.

A graduate of the People's Public Security University of China, Ma was the first college graduate from Yaodong village in Hualong county. After graduation, he passed China's highly competitive civil service exam and became an officer in the Public Security Bureau of Xining, Qinghai's capital.

Ma's brothers all run lamian businesses across the country, and he often thinks about the future of the industry.

During a trip to Hangzhou, Ma heard that over 10 Hualong people who jointly own a lamian restaurant were arrested after fighting with a new lamian restaurant that opened next to theirs. In order to drive away their competitors, they smashed the furniture in the other restaurant.

Cases like this are not unusual. In fact, it's an unwritten rule that new lamian restaurants should not open within 300 meters of existing restaurants. When competitors enter the picture, Hualong lamian owners often choose to drive them away using violence. On China's blogsphere, complaints about lamian restaurants breaking the law are common.

"Why are Hualong's lamian restaurants so often in trouble? I felt there is a need there to help modernize their management," Ma said.

In May 2013, Ma resigned from his public service job, and established a lamian service center, helping small lamian restaurants to form chains and modernize their management. Their clients also include Hualong's county government, which employs their services to provide training to new entrepreneurs.

Ma Qingyun meets Malaysian politicians during a trip to Malaysia in November 2015. Photo: Courtesy of Ma Qingyun


Going abroad

Other than helping lamian restaurants form franchises, Ma also wants to help Chinese restaurants go abroad.

"After nearly 30 years of expansion, the lamian industry is becoming increasingly saturated in China. China's Belt and Road initiative is a call for us to expand our businesses out of China," Ma told the Global Times.

Last January, Ma organized a group of 28 lamian restaurant owners and sent them on a trip to Malaysia to look for potential business opportunities. Jia was one of them.

Jia is one of the founders of the Hainier chain of lamian restaurants. In 2003, he opened a small restaurant in Yantai, East China's Shandong Province, and earned his first pot of gold. In 2015, he partnered with four other entrepreneurs and registered their own brand, and now they own over 20 restaurants in cities including Xiamen of Fujian Province and Xining.

Ma said that there are many reasons why Malaysia is a great starting point for Muslim entrepreneurs from Hualong looking to expand overseas.

One major reason is a historical and emotional bond. Many in the Muslim-majority country still hold high respect for Zheng He (known in Malaysia as Cheng Ho), an ethnic Hui Muslim admiral in the Ming Dynasty (1368-1644) who commanded sea voyages to many countries in Southeast Asia, Western Asia and East Africa from 1405 to 1433. In Malaysia, he built Muslim communities and is credited with leaving a vast Islamic legacy there.

"When we went to Malaysia, we were warmly welcomed by the local Muslim community, and many Malaysians referred to us as the descendants of Zheng He," Jia said.

"The cost of raw materials and rent in Kuala Lumpur are all lower than in China, and yet the average price of a bowl of noodles is twice what it is in China. We thought this might be a good opportunity," Jia told the Global Times.

Chinese Muslims are also attracted by Malaysia's more mature halal food industry which has a certification system that's widely acknowledged by other Muslim countries. "Entering Malaysia's food and restaurant market will help our lamian restaurants upgrade to international standards, and from Malaysia, we can further move on to expand to other countries," Ma said.

Mohd Ismail Ibrahim, president of the Malaysia, China Muslim Chamber of Commerce, said the chamber has already assisted many business groups from China who want expand into Malaysia."We will assist lamian restaurants to obtain halal certification from the Malaysian authorities and will help them apply for franchise licenses," he told the Global Times in an e-mail interview.

Li Ziran, director of the Institution of the Halal Industry at Ningxia University, Northwest China's Ningxia Province said these restaurants are also a great way to showcase China's diverse culinary culture. "It helps boost China's national image," he told the Global Times.



Difficulties

Despite all this optimism, Chinese Muslims face many difficulties in Malaysia. Apart from the language barrier, one hurdle they have to jump first is getting passports. Jia says he intends to dispatch 4 to 5 employees to be stationed in each of his lamian restaurant in Malaysia, but the passport application process for Muslims in Qinghai can be long and complicated due to passport controls.

"Luckily we received assistance from Qinghai's Department of Commerce, which solved our problems," he said.

Professor Li said China and Malaysia's different food cultures might also be a barrier to these restaurants' success. "While they have the same religious background, lamian was the food for nomads in northwestern China, and yet Malaysian food culture is more similar to southern China which favors rice and seafood. It will require innovation on the part of these entrepreneurs for their restaurants to be accepted in Malaysia," Li said.

But Ma and his fellow entrepreneurs are ready to take this risk. Apart from Malaysia, Ma Qingyun is now preparing a trip to Kazakhstan and Turkmenistan for lamian entrepreneurs to inspect local business opportunities. He himself is going to open several restaurants in Indonesia this year.

Ibrahim said the chamber also has a potential partner in Dhaka, Bangladesh, and will open the first lamian outlet in that city by the end of this year.


Newspaper headline: One belt, one noodle


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