The smell of freshly baked Rotiboy buns is difficult to ignore. Before customers even see the outlet, the aroma of coffee, bread and melting butter tells them that a fresh batch is nearby.
Today, Rotiboy is one of Malaysia’s most recognisable homegrown food brands. Its signature coffee bun has travelled far beyond Penang, reaching customers across Asia and the Middle East.
But the business did not begin with hundreds of outlets or long queues. Founder Hiro Tan once struggled to generate just RM60 in daily sales, while his family had to sell a car to keep the company alive.
In 2025, the Malaysian bakery brand had reportedly sold more than 800 million buns worldwide. It was an extraordinary achievement for a business that started as a small neighbourhood bakery in Bukit Mertajam.
Baking Was Part Of Hiro Tan’s Childhood
Tan’s connection to baking began years before he became an entrepreneur.
His family made and sold homemade pau, or steamed buns, in Tanjung Bungah, Penang. As a child, Tan would wake up at around five in the morning to attend school. When he returned home, he helped his parents prepare, fill and shape the buns.
After receiving his motorcycle licence in Form Four, he began delivering the products to customers.
Tan continued selling his family’s homemade buns while studying economics at Universiti Malaya, partly to finance his education.
However, he did not immediately build a career in baking. Before becoming a bakery founder, Tan worked in several fields, including as an insurance agent, airline station manager and tuition teacher.
He also tried mushroom farming, although the venture did not succeed.
“Starting Rotiboy was without a doubt really tough in the beginning, but my intention has always been to build and grow something,” Tan said.
Although his previous ventures did not achieve much success, he said the experiences taught him valuable lessons.
Meanwhile, his siblings had worked at Penang-based Eden Bakery, where they gained experience making bread and cakes. With baking knowledge already present in the family, Tan believed it was time to build something of their own.
Rotiboy Began As A Small Bakery In Penang
Tan and his elder sister opened the first Rotiboy Bakeshoppe in Bukit Mertajam in April 1998.
It initially operated as a traditional neighbourhood bakery selling bread, cakes, pastries and other freshly baked products to the local community.
The brand’s unusual name was reportedly inspired by Tan’s mischievous nephew. When a family member called the child a “naughty boy”, the words eventually led to the name Rotiboy.
But the product that would transform the company was its version of a Mexican-style bun.
Tan’s sister modified the recipe by filling the bun with butter and adding a coffee-flavoured topping. When baked, the topping spreads across the surface and becomes crisp, while the inside remains soft and buttery.
It was a relatively simple product, but it gave the company something every growing food business needs: a signature item that customers could easily recognise and remember.
The Klang Valley Expansion Nearly Destroyed Rotiboy
After operating in Bukit Mertajam for several years, Tan decided to take the business into the Klang Valley.
The company relocated to Subang Jaya, in 2001. Tan believed the larger market would allow the bakery to grow more quickly, but the move did not immediately produce the results he expected.
There were days when the outlet generated only around RM60 in sales.
The business was losing money, and the family came under serious financial pressure. Tan’s brother eventually sold his car to raise funds and keep the bakery operating.
Instead of giving up, Tan continued searching for a location and retail format that could work.
A Small Outlet Changed Everything
The company’s major turning point came around 2002, when it secured a small space at Wisma Central.
The location was surrounded by office buildings, banks and KLCC. More importantly, the team changed the way it prepared and sold its signature product.
Instead of baking the buns elsewhere and transporting them to the shop, Rotiboy began baking them directly at the outlet.
This meant customers received their buns warm from the oven. It also allowed the aroma of coffee and butter to spread throughout the surrounding area.
That smell became one of the brand’s most powerful marketing tools.
“We then sold from 20 to 30, 60 and then hundreds of buns a day,” Tan recalled.
The company also used paper pouches instead of plastic bags because the products were still warm. Besides making them easier to carry, the paper allowed the aroma to escape as customers walked through the area.
In effect, each customer became a moving advertisement for the brand.
Its small two-tier convection oven could only produce 12 buns every 15 minutes, or about 48 buns an hour. As demand increased, the limited production capacity created long queues outside the outlet.
What began as a production limitation soon became another form of publicity. The queues attracted attention and encouraged more people to discover what everyone was waiting for.
From Wisma Central To KLCC
The success of the Wisma Central outlet helped the company expand across the Klang Valley.
One of its most important locations opened at KLCC, where the smell of freshly baked buns became familiar to office workers, shoppers and commuters.
The outlet remained in operation for 21 years, making it one of the company’s most recognisable branches.
However, popularity did not guarantee profitability forever. Tan later revealed that the location had struggled financially for several years.
“We tried to keep it,” he said. “My heart hurts, and a lot of people are disappointed. But at the end of the day, we had to let it go.”
The outlet permanently closed on 8 September 2024.
Its closure demonstrated the difficult reality of operating a retail business. Even a well-known outlet can become unsustainable when rental costs, operating expenses and customer behaviour change.
Taking Rotiboy Beyond Malaysia
As the signature bun became more popular locally, demand began appearing overseas.
Indonesia became one of the company’s most important international markets. Four Indonesian businesswomen pursued the master franchise after one of them tasted the bun during a visit to Malaysia.
Securing the rights was not easy. Many other parties had reportedly approached Tan with similar proposals.
The four women negotiated with him for around one year before he agreed to grant them the Indonesian master franchise. They then spent another six months preparing to introduce the product.
With approximately Rp1 billion in capital, they opened their first outlet at Menara BNI and employed 15 people. The launch attracted long queues, showing that the product’s appeal could travel beyond Malaysia.
The company later entered other international markets, including Singapore, South Korea, Saudi Arabia and the United Arab Emirates.
It also adapted its business model to different countries. Some markets focused mainly on the signature coffee bun, while others operated cafés offering drinks, ice cream and a wider food menu.
Building A Business That Can Survive Without Its Founder
For Tan, opening more outlets is only one part of building a successful food company.
The greater challenge is keeping the brand relevant as customer preferences, delivery platforms, shopping habits and operating costs continue to change.
“This industry is tough because I’ve seen people make a lot of money very fast and lose it all even faster,” he said.
The company’s journey shows that expansion does not always follow a straight line. It has entered new countries, left certain markets, experimented with different formats and closed outlets that could no longer operate sustainably.
Its survival has depended not only on growth, but also on knowing when to adapt and when to let go.
Tan has said that his long-term ambition is to build a company that can continue operating without him.
“I know I won’t be around forever to manage this company, but I am looking to build a long-term legacy for the Rotiboy brand,” he said.
“I want this company to live on forever.”
More than two decades after nearly failing with RM60 in daily sales, Rotiboy has turned one signature bun, a small oven and an unforgettable aroma into a Malaysian success story recognised around the world.
Sources: 1 | 2 | 3 | 4 | 5 | 6 | 7
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