K-bakery giants, CJ Foodville and SPC Group, are rapidly expanding their footprint in the U.S. as sales soar. Both companies have set an ambitious goal: to open 1,000 stores each across North America by 2030.
Their expansion drive stems from the booming sales in the U.S. market. CJ Foodville USA reported that sales for TOUS les JOURS surged by approximately 50%, and operating profit rose by 40% year-on-year. Paris Baguette also witnessed an increase of 30 to 40 percent compared to the previous year.
This sales growth of K-bakery chains is attributed to a strategic shift toward franchising. While both companies initially operated through direct branch stores in the early 2000s, they pivoted to a franchise model in the early 2010s, which supercharged their sales trajectory.
Today, franchised stores account for 85% of Paris Baguette outlets and 90% for TOUS les JOURS. Originally targeting areas with dense Korean populations, the chains are now expanding as the allure of Korean-style bread grows among non-Koreans.
In a recent milestone, CJ Foodville unveiled its 100th TOUS les JOURS store in Bronxville, Manhattan, on the 21st.
Having debuted in Korea in 2004, TOUS les JOURS adopted the franchise model in 2009. It now has a presence in 26 U.S. states, with plans to launch 120 stores by year’s end. CJ Foodville runs 15 stores in Southern California, with a mere two directly managed in LA and New York; the rest are franchises.
“The dominant store owner demographic used to be Korean Americans. However, in recent consultations for new store launches, they now account for less than 50%,” shared the company.
TOUS les JOURS, a subsidiary of CJ Foodville, turned its first profit in 2018, 14 years post U.S. market entry. Sales surged by 50% in this year’s first half, with a 250% increase in operating profit year-on-year.
Experts speculate that CJ Foodville’s upcoming U.S. baking plant will bolster store expansions, given a localized production system.
On the other hand, SPC Group’s Paris Baguette is advancing into Washington, North Carolina, and Tennessee, having already signed over 160 franchise agreements. They crossed the 100-store mark in the U.S. in early 2022 and currently operate 139 stores. Their expansion also reached Canada with the opening of their inaugural store in March.
The company’s expansion strategy focuses on the west coast, specifically Los Angeles and San Diego, and the east coast, including New York, New Jersey, and Boston. They are also eyeing locales near Silicon Valley and in North Carolina, Colorado, Maryland, Tennessee, and Hawaii.
SPC Group debuted in the U.S. in 2005 with Paris Baguette Western in Los Angeles. Paris Baguette cites its unique self-service system, which allows customers to handpick bread, and dynamic product displays as catalysts for its American market growth.
BY EUNYOUNG LEE [lee.eunyoung6@koreadaily.com]
