Days after fighting over pearl-making machines on Facebook, bubble tea chain Xing Fu Tang’s Malaysian and Taiwanese businesses have escalated to threatening each other with legal action for accusations hurled online.
Earlier last week, the Taiwan HQ accused its Malaysian master franchisee, Collab Working Lifestyle, of breaching the terms of its contract to squeeze out profits from outlet owners, and threatened to terminate its agreement.
Days later, the Malaysian side responded by accusing the Taiwan business of defaming it because it would not pay the “sky high” price of RM4.5 million for machines to make heart-shaped, star-shaped, and Mickey Mouse-shaped pearls.
On Tuesday (Oct 29), the Malaysia business followed up with a second post containing screenshots of conversations between the brand’s HQ and various master franchisees from London, Thailand, Vietnam, Singapore, and Indonesia over the pearl-making machines.
In the conversations, the Taiwan HQ also asked these franchisees to purchase the machines, and some franchisees responded with shock at the quoted price.
“Similar incidents have happened to many franchisees across the world as well, but due to fear, they have chose to keep quiet. Only Xing Fu Tang Malaysia is willing to step up,” the post read.
“Is Xing Fu Tang Taiwan HQ that desperate for money?” it added.
In response, the Taiwan HQ hit back with a dramatic, lengthy Facebook post on Wednesday (Oct 30), titled “Xing Fu Tang exposes its Malaysian master franchisee’s hidden secret”.
In the post, the Taiwan HQ said the sale of the pearl-making machines was a test given to all franchisees to see if they were invested in the business for the long-term, or just looking to “make a quick buck”.
Repeating its earlier accusations against its Malaysian partner, it called Collab Working Lifestyle “deeply ungrateful” and “a blatant liar”, adding that it intended to gift the pearl-making machines to sub-franchisees for free.
The Taiwan HQ also defended itself against claims made by Collab Working Lifestyle that it sold unnecessary or low-quality equipment at exorbitant prices, saying it had always used transparent cost pricing.
The post also listed nine contract breaches committed by the Malaysian firm – including making unilateral changes to sub-franchisees’ agreements – with the Taiwan HQ promising to help sub-franchisees recover unreasonable and extra-contractual fees charged by Collab Working Lifesyle.
“Xing Fu Tang Taiwan headquarters will be filing litigation against its Malaysian master franchisee to protect its sub-franchisees,” it added.
The post also accused Collab Working Lifestyle’s founder, Derek Cheong, of “betraying” and cheating sub-franchisees and a former business partner of money from the franchise.
It added that Cheong had finally “revealed his true colours” after the brand refused to sell him additional franchise rights to its hotpot chain.
Xing Fu Tang CEO “twisted his words” over pearl-making machines, Malaysia side says
A day after the damning post, Collab Working Lifestyle hit back with a short statement, saying it hoped the Taiwan HQ would stop runing the brand’s reputation with “ridiculous accusations”.
Referencing claims that the pearl-making machines were a test for franchisees, Xing Fu Tang Malaysia said CEO Edison Chen had simply “twisted his words” after being exposed.
It also identified the business partner mentioned in the Taiwanese post as former manager Chris Chen Wei Hau, describing the matter as an “old case involving a former staff (member)”.
It attached a screenshot of a legal letter to Chris Chen, adding that it “reserved the right to take action towards Taiwan HQ” over defamatory claims that it was “unscrupulous in conducting business” and had “manipulated our former business partner”.
📢 對於台灣總部昨日一連串的失實指控，我們本來不打算再作任何回應，但因傳媒要求回應，我們不得不發聲明：台灣總部扭曲事實，用一個謊言掩飾另一個謊言！在此澄清文中涉及Collab Working…
Separately, the account also posted a CCTV video of a man caught splashing red paint on the signboard and pavement outside a Xing Fu Tang outlet on Wednesday (Oct 30).
Previously, two Xing Fu Tang outlets in Klang Valley were vandalised with red paint five times in the week the online spat first began.
“We have lodged police reports and submitted the CCTV footage to authorities. We don’t know who did it, but we refuse to bow to thugs,” Xing Fu Tang Malaysia wrote in a post on Monday (Oct 28).
On its Oct 30 post, it said: “We Malaysians love our peace and we will not tolerate such low class behaviour.”
Addressing the man in the video, it added: “We are nice people. when you are in jail, maybe we will send you one cup of bubble tea.” Read also:
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