Jollibee - one of the largest Filipino-owned fastfood chain in the world

Jollibee logo

Jollibee Foods Corporation (PSE: JFC) (widely known as Jollibee) is a fast-food restaurant chain based in the Philippines. As of December 2007, Jollibee has become one of the biggest fast-food chains in the world with 1,655 stores worldwide (although its own web site claims only 600) and total sales of more than US$1 billion. As of March, 2008, JFC has 1,466 stores in the Philippines namely, Jollibee (627), Chowking (377), Greenwich Pizza (236), Red Ribbon Bakeshop (194), Délifrance (28) and Manong Pepe's (4). According to its own web site, it has 23 stores overseas. As of end-September, 2008, JFC has 1,490 local and 228 foreign stores in its portfolio.

Foundation and History

Tony Tan Caktiong and his family opened a Magnolia Ice Cream parlor in Cubao in 1975. The original name was Jolibe. Sometime in 1978, Tony Tan and his brothers and sisters, being partners, engaged the services of a management consultant in the person of Manuel C. Lumba. Lumba became Tony Tan's first business and management mentor.

Consultant Lumba shifted the business focus from ice cream to hamburgers, after his studies showed that a much larger market was waiting to be tapped. He had the name changed from Jolibe to Jolly Bee, then to the one-word name Jollibee. Next, Lumba conceptualized the Jollibee mascot, inspired by local and foreign children's books, and created the product name "Yumburger" as well as "Chickenjoy". He had the company incorporated and leased a house on Main St. in Cubao, Quezon City, as their first headquarters.

Lumba also formulated the company's long-term marketing strategy, listing a number of consumer promotions and traffic-building schemes. Tony Tan stressed that developing internal strengths was primary. The stores were re-designed, the restaurant transformed into a full self-service, fast food operation with drive thrus. Not long after, Tony Tan and Manny Lumba went on an observation tour in the United States, attended food service and equipment conventions. Tony Tan put Manny Lumba in charge of franchise development.

Expansion and Acquisitions

The company acquired 80% of Greenwich Pizza Corp. in 1994, enabling it to penetrate the pizza-pasta market. From being a 50-branch operation, Greenwich has established a strong presence in the food service industry. In early 2006, Jollibee Foods Corp. bought out the remaining shares of its partners in Greenwich Pizza Corp., equivalent to a 20% stake, for P384 million in cash.

In 2000, the company acquired Chowking, allowing Jollibee to be part of the oriental quick service restaurant market. In 2005, they acquired Red Ribbon Bakeshop, another popular restaurant chain in the Philippines. 

In 2004, Jollibee acquired Chinese fast food chain Yonghe Dawang for $22.5 million. Jollibee entered into a joint-venture contract with US-based Chow Fun Holdings LLC, the developer and owner of Jinja Bar Bistro in New Mexico, in which Jollibee will have a 12% stake for $950,000. Jollibee purchased 70% of Taipei restaurant Lao Dong in June and Chun Shui Tang tea house in 2006. In the same year, the company acquired the franchise of Délifrance. This further expanded its penetration in the food service industry, particularly in the French cafe-bakery, a growing segment of the Philippine food market. In September of 2006, the company acquired the remaining 50% stake of Delifrance Asia Ltd. in Baker Fresh Foods Phils., Inc. (BFFPI). This means BFFPI is now a wholly owned subsidiary of Jollibee and that the listed food giant has the exclusive rights to operate Delifrance outlets in the country. "The acquisition involved a restructuring of all advances by Jollibee and Delifrance Asia amounting to P130 million into equity," a public statement said. Jollibee added that the strong sales posted by Delifrance encouraged it to buy out its partner.

Jollibee's locations worldwide as of 2013

The corporate actions in buying out the minority shareholders in Greenwich Pizza (20%) and Delifrance (50%) were the prelude to a plan to integrate the Greenwich Pizza, Chowking, and Delifrance brands under one corporate entity. Under this plan, merging of the subsidiaries would be implemented by having Greenwich Pizza Corp. and BFFPI folded into Chowking Food Corp. The surviving entity would be renamed Fresh 'N Famous Foods, Inc. No new shares would be issued as the assets of Greenwich and BFFPI will be injected into Fresh 'N Famous as additional paid-in capital.

On July 25, 2007, Jollibee launched its pilot restaurant "Tio Pepe's Karinderia" in Edsa Central in Mandaluyong, to professionalize the Philippine carinderia business.

On August 26, 2008, Jollibee formally signed a P2.5 billion ($55.5 million) deal with Beijing-based Hong Zhuang Yuan through its wholly owned subsidiary Jollibee Worldwide Pte. Ltd. The sale is subject to the approval of China's Ministry of Commerce.

On October 19, 2010, Jollibee acquired 70% share of Mang Inasal, a Filipino food chain specializing in barbecued chicken, for P3 billion ($68.8 million). The same month, Jollibee signed a deal to acquire 55 percent of China's Guangxi San Ping Wang Food and Beverage Management Co. Ltd., operators of the San Pin Wang beef noodle business for 30 million RMB.

On October 1, 2011, Jollibee acquired a 54% stake in BK Titans, Inc., the sole franchisee of Burger King in the Philippines. In the same year, Jollibee opened 260 new stores, of which 167 were in the Philippines led by Mang Inasal (86) and Jollibee (40). This brought the company's total number of stores to 2,001 as of end December 2011. The same year, Jollibee closed Manong Pepe foodchain in favor of Mang Inasal, and sold Délifrance to CaféFrance. In the same year, the company acquired Chowking stores in the US from their licensee, Burger King business in the Philippines and SuperFoods business in Vietnam and other Southeast Asian countries.

Overseas, Jollibee opened 93 stores, led by Yonghe King in China (70) and Jollibee Vietnam (11). Currently, it also has locations in the United States, Saudi Arabia, Hong Kong, Vietnam, Malaysia, Indonesia, Dubai and Brunei. Jollibee is also the name of their mascot, a large bee in a blazer, shirt and chef's hat.

Products and Services

The famous Jollibee Chickenjoy meal

Jollibee is an American-style fast-food restaurant with Filipino-influenced dishes specializing in burgers, spaghetti, chicken and some local Filipino dishes. In the Philippines, Jollibee serves Coca-Cola products for its beverages; in overseas markets, the chain serves Pepsi products. 

Jollibee has a variety of menu choices. Some of its menu items are as follows: 

• Chickenjoy - fried chicken
• Champ - a half-pound burger with tomato, lettuce, cheese, pickles, etc. (similar to McDonalds' Big Mac)
• Jolly Spaghetti - spaghetti with the typical Filipino-style sauce (sweet and a bit spicy), hotdog slices and spiced ham
• French Fries
• Yumburger - regular hamburger with special dressing
• Yumburger with Cheese
• TLC Burger - hamburger with tomato, lettuce and cheese
• Mushroom and Cheese Burger - hamburger with sauteed mushrooms and a cheese sauce
• Aloha Burger - hamburger with bacon and pineapple ring
• Burger Steak - served with mushroom sauce
• Jolly Hotdog - hotdog sandwich topped with manhattan sauce (similar to 7-11's hotdog sandwich) and grated cheese

To provide their costumer better satisfaction, they offered the following services:

• 8-7000 Jollibee Express Delivery Service
• Jollibee Kids Party
• Jollibee Drive Thru
• 24-hour Service
• 8 success secrets from Jollibee, which aims to be in world’s top 3

Secrets behind success

In the interview of the Philippine STAR in March 2013 in connection with Jollibee’s 35th Anniversary this year, Chief Operating Officer (COO) Ernesto “Ato” Tanmantiong revealed how the company made it to success.

1. Customer focus — “The market is so dynamic and fast-changing, so we do a lot of research. When Jollibee was small and we had little research funds, we directly asked customers their needs and wants.” 
2. Vision — Tanmantiong said, “When we started in 1978, people asked why we didn’t get a US franchise. We already wanted to create our own brand because we didn’t want to be limited to the Philippine market. Since the start, our vision was, first, to become No. 1 in the Philippines; second, to eventually expand overseas. Now our vision is we want to be one of the top three largest and among the most profitable restaurant companies in the world. Again, this is a big dream.” 
3. Spirit of family and fun — “Among the Jollibee core values are unity and team work. We have less than 10 family members working at Jollibee group. We now have over 40,000 employees, roughly 4,000 of whom are managers. If you include the other brands, we have maybe more than 60,000 employees.” 
4. Good quality — Tanmantiong said that the consistently “superior taste” of Jollibee foods is one success secret of their business. The family’s eldest sister Virgie Tan Chua was the one who started Jollibee spaghetti. When I asked if they had paid her for this recipe, Ato Tanmantiong laughed, saying, “Don’t give her the idea!”
5. Location — Jollibee makes sure that its stores and affiliates are conveniently located.
6. Good partners — Jollibee group has grown phenomenally due to good business partners through its franchising system. Today, 50 percent of Jollibee stores are owned by franchisees. Each franchise now costs about P25 million.
7. Culture — “We make sure the whole organization shares our vision and values, meaning they’re all part of that,” Tanmantiong said. “Our corporate values are excellence, spirit of family and fun, humility to learn and listen, integrity, frugality, respect for the individual, and teamwork. Anybody who is not a fit to all that, we remove from the organization. Our people are more engaged and committed.”
8. Marketing — The overall marketing programs and efforts have contributed to the success of Jollibee, from the brand name, logo, the popular mascot, TV commercials and print ads, to their very own TV show. Their top celebrity endorsers include Aga Muhlach, Sarah Geronimo, Gerald Anderson, Enchong Dee, Kim Chiu, international brand ambassador Jessica Sanchez and the very first endorser of the early 1980s, singer Gary Valenciano.

A Filipino Pride

Jollibee dedicated its continuous success to the Filipinos who have been there from the very start. Jollibee is so well-loved everytime a new store opens, especially overseas, Filipinos always form long lines to the store. It is more than home for them. It is a stronghold of heritage and monument of Filipino pride.

Source:
jollibee.com

wikipilipinas.org

wikipedia.org