Oi Hanoi: Back From The Dead
David Birch found out on Facebook that his parent company and business partner in Australia had gone bust. He had 24 hours to either save the business or call it quits and find a job.
Between November 2014 and May 2015, a small restaurant selling Vietnamese food next to Aldgate East station had three entirely different names and fit-outs. First corrugated iron, reclaimed wood and bamboo as a stylised south east Asian market style shop trading as MissChu; then all black and spare under the Vietnamese Street Food banner, and finally in its current incarnation as the brightly lit and more obviously fast-foody Oi Hanoi.
An indecisive owner perhaps with a penchant for a rebrand? It was, in fact, the result of a series of events that pushed the business within a whisker of collapse.
Search and Fit-Out
MissChu had built up eight branches in Melbourne and Sydney and a heap of local praise in 18 months when David Birch, general manager, was charged to bring the format to London.
An overseas business, audacious in its ambition, was in motion, with Birch the 60% shareholder and founder Nahji Chu maintaining control of the aesthetics.
Problems began when confronted by the reality of finding a site. The search took vastly longer than anticipated. That and Chu’s fit-out specifications wiped out £320,000, putting the business on an uneasy footing before the doors were opened.
Trading was patchy for the next 12 months, with Birch increasingly questioning whether he had chosen the right location.
Then on 23 December 2014, Birch woke up, reached for his phone and discovered his business partner and parent company had gone into receivership. ‘There was a post on the MissChu Facebook page. I was dumbstruck.’
He immediately called his lawyer and told him everything he knew. ‘This is a shit sandwich; you just have to work out how you’re going to eat it,’ came the sighed response.
Insolvencies are never easy, but this was made harder with the business relationship with the parent company, the geographical distance and being two days from Christmas.
Birch and Chu had already been swapping emails about the precarious nature of the business with cash running thin, but he hadn’t expected the business in Australia would file for insolvency.
He now had a legal obligation to cease trading and wind the company up, notifying anyone the company owed money to, including his landlord which would’ve meant terminating the lease on the site.
‘I had a dilemma. Either leave the country and go to my wife in Israel with my tail between legs after two years of hard work and tell 18 staff they didn’t have a job two days before Christmas, or try and exhaust every avenue.’
Trip to Birmingham
Some months prior, a Birmingham based restauranteur, Alex Xu, came to MissChu and struck up a friendship with Birch. Birch found Xu’s number in his phone and explained his predicament. He picked up his coat during the call, made his way to Euston station and got on a train to Birmingham hoping to persuade Xu to become his new business partner.
‘I explained my vision, the potential of the brand with high quality food and how it could work without all the set up issues that had made it difficult so far.
They thrashed out a deal and Birch was back on the 5pm train. ‘It was all done quickly and on a handshake. We didn’t have time so the paperwork had to wait.’
Painting at night
The two were now 50–50 partners and a new company was to be formed.
On his return, Birch contemplated his next task: convincing the landlord (who was already unhappy about some unpaid rent) to give him a new lease on the same terms.
His lawyer had explained the new company would have to bear no cosmetic relation to the insolvent MissChu. ‘Me and three of the staff flipped the tables that night, bought some black paint and got to work on the walls, chairs and tables.’
The restaurant transformed to the all black fit out and ‘Vietnamese Street Food’ minimally etched on the front. Exhausted but also looking ahead to a new phase, Birch went to his wife in Tel Aviv for Christmas while the staff pressed on with the rudimentary refurb back in Whitechapel. He set up the new company in January and appointed a small branding agency to develop a fresh identity.
He concedes the new look under the Oi Hanoi is a little garish and lacks the charm it had under MissChu, adding: ‘There’s a bit of de-sterilisation to be done I admit, but it’s all about the food.’ The plan is now to open branches in London’s outer commuter periphery and find franchise partners
Stung a little by the seat-of-the-pants expansion drive he previously experienced, Birch has been trying to get the basics right. He’s aimed to make the operation simple, believing it was previously too complicated and has set up a base for buying and production. He’s also cut out the in-house delivery bikes, using Deliveroo instead. ‘We’re great at making Vietnamese food. We’re shit at logistics, so it made sense to farm that out.’
Back in Australia, MissChu was bought out of administration by a larger group with the eponymous founder now a 25% shareholder. A spokesman for the company said: ‘We have restructured our business operations and are currently consolidating our Australian model in order to refine systems and streamline processes. We hope to re-enter the UK market in the future, but for now are staying within Australia.’ It appears a new spirit of sobriety and getting the basics right reins for both Birch and the new MissChu.
Birch appears unscathed from the episode last Christmas, although he comes across as a man who wears his heart on his sleeve. MissChu wasn’t his first difficult commercial experience: he was burned on investment on a house in Indonesia after his investor had disappeared.
‘To be a survivor is a great quality, but if it’s the only quality you have, you’ll only ever be a survivor,’ he says.