Jollibee Foods Corp Group Sun Spring 2008 Background

Jollibee Foods Corp Group Sun Spring 2008

Background n Started in 1975 by Tan Family – Ice cream parlor n Started the hamburger business because of 1977 oil crisis n The “Jollibee” name

Background (cont) n Built reputation of the Five “Fs” – Friendliness, Flavorful food, Fun atmosphere, Flexibility in catering to customers needs, and Focus on family n Mc. Donalds enters Philippines in 1981 – Jollibee has 11 stores n Economic & Political Crisis slowed Mc. Donalds expansion

Industry Background n Fast food pioneers in the 1960’s - Ray Kroc of Mc. Donalds - Colonel Sanders of Kentucky Fried Chicken

Business Level Strategy n “Five Fs” philosophy n Brand Loyalty in the Philippines n International expansion - “Targeting Expats” - “Planting the Flag” § Franchising

Corporate Level Strategy Mission: “To serve great tasting food, bringing the joy of eating to everyone. ” n Values n – – – – Customer Focus Excellence Respect for individuals Teamwork Spirit of family and fun Humility to listen and learn Honesty and integrity Frugality

Corporate Level Strategy n Vision – – – We are the best tasting QSR. . The most endearing brand. . . We will lead in product taste at all times. . . We will provide FSC excellence in every encounter. . . Happiness in every moment. . . By year 2020, with over 4, 000 stores worldwide, Jollibee is truly a GLOBAL BRAND. (and the Filipino will be admired worldwide)

Competitive Advantage n Store Management – Motivating & controlling crew members – Efficient use of time n Chain Management – Consistency & reliability – Uniformity n Operational Management – Franchise Service Managers (FSM)

Competitive Advantage n Benchmarking – Internal – Competitive n “Planting the Flag” n “Targeting expats”

Industry Key Success Factors n Flexibility as one of the 5 Fs – Bargaining Power of Customers n “It is not easy to deliver quality food and service consistently and efficiently. Behind all that dun and friendly environment that the customer experiences is a well oiled machine that keeps close tabs on our day-to-day operations. It’s one of our key success factors. ” -Senior manager at Jollibee

Challenges n The need and want for their products n Menu modification

Three Options for Expansion n Papua New Guinea- Raising the Standard – New Entrant into 3 store fast food chain – Tingzon offered to put up all capital required n Hong Kong- Expanding the Base – 3 Store established possible 4 th – High volume with Filipinos but not with residents (Chinese) – 4 th store location high traffic but few Filipinos

Three Options for Expansion (cont) n California-Supporting the Settlers – Success in Guam led them to believe US had potential § Food Appealed to Filipinos and Americans – Decided on Daly City-Large Filipino population – Plans to appeal to Asian Americans and then Hispanic Americans

Pro vs Cons n Papua New Guinea n Hong Kong n California – Pro-Good quality of product/risk no equity – Con-franchises might not be able to serve the market (20 stores) – Pro- Previous stores have done well – Con-Low Filipino population at site/ Chinese & Filipino management style differ – Pro-High Filipino population/done well against Mc. Donalds – Con-12 hours away/Very saturated market

Currently n Over 570 stores in the Philippines n 16 stores in the US (CA, NV, NY) n 9 stores in Brunei n 9 stores in Vietnam n 1 store in Hong Kong n 1 store in Saipan

Currently (Cont) n Current Strategy – Expansion into China § Acquired Chinese restaurant food chain – Hongzhuangyuan § Bought 15% share of a chinese style fast food – Yonghe King – Expansion in California § Plans to open 8 more in California (2008)

Questions?