This article first appeared in The Edge Financial Daily, on November 16, 2015.

KUALA LUMPUR: Tony Roma’s Malaysia is optimistic about achieving 20% growth in sales this year as the food and beverage sector appears resilient despite the cooling consumer sentiment due to the rising cost of living.

Grand Companions Sdn Bhd chief executive officer (CEO) George Ang, who is responsible for introducing the Tony Roma’s brand to Malaysians, is upbeat about his business  prospects as each of the nine Tony Roma’s restaurants under the company has been raking in an average RM6.5 million revenue annually.

The ribs eatery business has been seeing double-digit growth in sales since 2012, six years after it opened its first outlet in Sunway Pyramid, Petaling Jaya.

Ang’s Grand Companions, which has the exclusive rights to own and operate Tony Roma’s in the country, pays a royalty of 4% to Romacorp Inc, the Florida-based parent of the ribs eatery.

The group’s capital investment per outlet is north of RM2 million, said Ang.

“The growth in sales year-on-year was primarily driven by providing an innovative menu to our customers,” Ang told reporters during a signing ceremony with Romacorp last Wednesday to introduce the TR Fire Grill brand in Malaysia.

By innovative menu, Ang meant, for example, that Tony Roma’s provides express lunch sets with smaller portions to its customers at a reduced cost. This maintains its volume to make up for the additional cost incurred from the weaker ringgit, which has been eating into its margins.

“We are currently buying overseas beef at an exchange rate of RM4.30 to the US dollar, which increases cost for raw materials,” Ang explained.

To reduce cost, he said the company is purchasing imported goods four months in advance.

Ang can also find consolation in the fact that although consumers are more cautious about spending after the recent price increase of items due to the introduction of the goods and services tax (GST) in April, he has not seen a dip in restaurant spending.

Ang signed a deal with Romacorp to open two TR Fire Grill outlets in Malaysia, and two in Indonesia. The first outlet will be opened in 2016 in Kuala Lumpur.

The new eatery is based on the American fine-casual dining, which also incorporates the farm-to-table and chef-inspired concept.

“TR Fire Grill will be a new growth brand for our company that is targeted at millennials. We look forward to introducing this brand to Malaysians,” Ang said.

He added that a new Tony

Roma’s outlet will be opening up in Kuching later this year. Its first outlet in Sabah and Sarawak, Ang said it will be a joint venture with Vivacity Megamall.

Ang added that he is targeting three new outlets in the next two to three years, and has no plans to trim the number of outlets despite the increasing cost of doing business.

“Other brands were far ahead of us in opening up in Malaysia, perhaps some 20 years ahead. We are sort of a latecomer to the market.

“Over the years, however, we have found a very strong market for ourselves in the lamb and beef ribs segment. That is how we differentiate ourselves,” he added.

Romacorp Inc’s new CEO Stephen K Judge, who was present at the signing ceremony, said the group is very careful and choosy as to whom they conduct business with, which contributes to their strong brand recognition internationally, even at just 43 years of age.

He added that together with Japan, Malaysia is Romacorp’s strongest market in the Asian region.