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Bubble tea brand Gong Cha to open locations in Puerto Rico

Premium bubble tea brand Gong cha has announced it will open its first stores in Puerto Rico through a partnership with franchisee SID Tea LLC, marking its debut in markets outside the U.S. mainland.

The company will enter the local market with a group of partners including José Vázquez, former vice president of the Puerto Rico Chamber of Commerce (CofC), former president of the Puerto Rico Restaurants Association (ASORE, in Spanish), and founder of the local Subway franchise. The SID Tea team includes Mario Gaztambide, vice president of operations.

In an interview with News is my Business, Gaztambide said the first two Gong Cha stores will open in May at Plaza Atenas in Manatí and Cupey, which are shared spaces with their other franchises, Subway and Wingstop.

The investment for each Gong Cha location hovers at about $300,000 and each will generate 12 to 15 jobs. Plans call for a total of seven store openings in 2024 and 2025.

“We were attracted to this concept because it’s a product that has much acceptance in the U.S. mainland and especially among young people. They’re opening stores in Latin America, and the product has also had great acceptance among that group,” Gaztambide said.

Although Puerto Rico has had bubble tea retailers, this is the first franchise concept to establish itself as a chain. The local menu will feature around 20 different bubble tea varieties based on tropical flavors and a range of sugar levels, Gaztambide said.

“The number of combinations is practically unlimited because the flavors can be changed and adapted to taste,” he said.

Gong Cha — which translates to “tribute tea for the emperor” — was founded in 2006 in Kaohsiung, Taiwan. It offers fresh tea sourced from Taiwan brewed throughout the day as well as freshly prepared pearls (bubbles).

Gaztambide said the local operation will use the same ingredients as the rest of the chain for its local offer.

Since 2014, Gong cha has opened more than 225 stores across 20 states, including Washington, D.C. The Puerto Rico launch signifies a new phase in Gong cha’s Americas expansion, focusing on direct franchising.

“After many years of inquiries, we’re thrilled to be able to finally offer direct franchise relationships,” said Geoff Henry, president of Gong cha Americas. “Over the past two years, our team has built a robust franchise support system – making significant investments in technology, launching a brand marketing fund, and nearly doubling the size of our U.S. team – in order to bolster a growing network of partners.”

The company also confirmed Bruce Park, partner at JB Investment LLC, as its second direct franchisee, who will open Gong cha’s first Las Vegas store. Alongside direct franchising, Gong cha will continue offering master franchise opportunities, particularly in Latin America.

“As Gong cha enters its 10th year of franchising in the U.S., the brand will begin offering direct franchising for its remaining U.S. territories, including Hawaii, Arizona, Nevada, Illinois and Tennessee, amongst others, to further accelerate its rapid growth,” the company stated in a press release.

“The new direct franchising model will complement Gong cha’s existing master franchise system in the U.S. By originally entering the U.S. market with a master franchise model, Gong cha was able to partner with experienced entrepreneurs with strong knowledge of their region to develop larger territories, which helped to rapidly introduce the brand to consumers, and scale across the country,” it added.

In 2023, Gong cha expanded its U.S. presence by 19%, adding more than 90 locations in the Americas. The brand aims to increase its store count in the Americas by more than 30% in 2024, with 130 new locations planned.

Author Details
Author Details
Business reporter with 30 years of experience writing for weekly and daily newspapers, as well as trade publications in Puerto Rico. My list of former employers includes Caribbean Business, The San Juan Star, and the Puerto Rico Daily Sun, among others. My areas of expertise include telecommunications, technology, retail, agriculture, tourism, banking and most other segments of Puerto Rico’s economy.

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