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Gong cha, a bubble tea brand founded in Taiwan and based in London, has hired former Five Guys CEO Paul Reynish as Global CEO in hopes of accelerating its U.S. and international expansion. Reynish succeeds outgoing interim global CEO, founder and chairman Martin Berry, who will remain in his role as chairman.
"Paul's extensive background in franchise operations globally, proven track record and passion for the Gong cha brand make him the ideal leader to build upon the momentum we've created over the past several years," Berry said in a company press release. "We're confident his guidance and insights will help us continue to position Gong cha as the clear category leader in the competitive global bubble tea market."
Most recently, Reynish was president and CEO of Five Guys International Restaurants, where he oversaw the brand's expansion, opening in 11 countries in three years. Prior to that, he served as chief marketing officer for Dunkin' Brands in Boston and vice president of business for Dunkin' Brands in Japan, where he managed over 5,000 stores across the Asia Pacific region. He has also served as CEO of international franchisees for Subway and worked in multiple global executive roles for Burger King in Europe, Asia, Australia and New Zealand. Additionally, he served as a board member of Baskin Robbins Japan and Korea for several years.
"I'm very excited to be joining the Gong cha team," Reynish said in the release. "Bubble tea is a rapidly growing sector, and with its scalable business model, innovative master franchise program, and talented management team, I believe Gong cha is uniquely positioned to become one of the world's largest franchised brands."
Bubble tea is a rapidly accelerating category in the beverage and fast casual space. As per a detailed industry analysis by Grand View Research, the market will achieve a compounded annual growth rate of 8.9% from 2020 to 2027, and nearly double in projected revenue — from $2.32 billion in 2020 to $4.25 billion by 2027.
Despite the COVID-19 pandemic and global economic conditions, Gong cha achieved double-digit sales growth in the majority of its markets worldwide in Q1 2022, and the total store count rose to nearly 1,800 locations across 22 countries. Globally, Gong cha's store count grew 17% year-over-year from 2020 to 2021, according to the release.
In the U.S., yearly store growth has nearly tripled since 2018, and 2021 openings were more than double that of 2019 and 2020. Gong cha is preparing to open its first five corporate-owned U.S. stores in the Chicagoland area in 2022 — with the long-term goal of opening more than 50 throughout downtown Chicago and the surrounding suburbs. It has over 160 stores across 14 states and Washington, D.C, and is projected to reach 200 stores in 18 states by the end of 2022. The brand is on track to exceed 500 U.S. stores by 2025.
The chain's master franchise model allows entrepreneurs with enterprise-level experience to develop a large territory. The principals for each territory build a network of sub-franchisees, opening the door to entrepreneurship for individuals who dream of owning a business. Since the beginning of 2022, Gong cha has signed three master franchisees in the U.S., awarding territory rights for the states of Louisiana, Colorado and Michigan. Together, these deals will grow the brand's U.S. footprint by an additional 60 stores over a period of five years.