SPC views Canada as 'litmus test' for France expansion
Paris Baguette's bakeshop in Lexington Avenue, New York / Courtesy of SPC Group
By Kim Jae-heun
SPC Group, operator of South Korean bakery chain Paris Baguette, is apparently eyeing expansion in France with the company hoping its recent decision to set up stores in Canada will help lay the necessary groundwork to increase its presence in the European country, according to SPC and industry officials.
SPC operates Paris Baguette stores in major cities in Asia, the United States and Europe. While it has been able to transform Paris Baguette's brand image to appeal to today's affluent consumers in these new markets, no substantial progress has yet been in its plan to establish a premium Maison de Paris store in New York City.
Now, because bakeries are among the most dynamic food sectors in the European Union, strongly driven by innovation and evolving consumer preferences, SPC Group is scrambling for a plan B.
SPC launched its brand in Paris in 2014, yet it only operates two stores in the French capital. Compared to the 83 stores the South Korean bakery chain is operating in the United States, its footing in Paris hasn't been substantial.
Regarding the possibility of opening more locations overseas, SPC officials said the company “still needs more time.” However, the firm has dropped hints that it could implement its knowledge gained from operating bakeries in the United States over the last 16 years to aid its business expansion in Canada and France. SPC plans to open 100 stores including in major Canadian cities from Toronto to Vancouver, within the next decade.
Canada could be interpreted as a litmus test for SPC for its expansion in Europe. The Canadian province of Quebec is French-speaking, so SPC hopes to learn more about French tastes and preferences from its operations in Quebec City and Montreal.
France is a country famous for its baked goods and high-quality patisseries, which is important in terms of brand equity and positioning for SPC's Paris Baguette.
SPC officials declined to elaborate on the specifics of its planned activities in Canada but the firm announced plans earlier to establish a dough manufacturing plant in Normandy, France, on which no visible progress has been made. SPC was aiming to supply dough to its franchise bakeries in Europe and North America.
“Korean bakeries have a unique identity. Paris Baguette, in particular, offers a range of products in individual packaging. Customers in North America find this very interesting,” an industry source said. “Paris Baguette will expand its business in Canada through a franchise system which will reduce the expense of opening stores.”