Screengrab from www.jollibee.com.ph
MANILA, Philippines—Jollibee Foods Corp., now a leading Asian restaurant chain, plans to enter Malaysia and Indonesia within the next two years and grow its Southeast Asian presence through the franchising mode.
JFC chief finance officer Ysmael Baysa said during the ING Bank-Economic Journalist Association of the Philippines CFO forum on Wednesday that the group has been looking for partners to enter these two big Southeast Asian markets in the last couple of years.
Within the next two years, he said, JFC should have set up shop in at least one of these markets. Most likely, Baysa said, JFC would come in using the franchising route similar to the expansion strategy in the Middle East.
Baysa, recipient of 2010 ING-Finex (Financial Executives Institute of the Philippines) CFO of the Year Award, said the Association of Southeast Asian Nations which is eyeing some for of economic integration by 2015, won’t likely contribute much to JFC’s total international business over the short term.
“We are growing very fast still in the Philippines, China and US but I think it could be big because ASEAN has a very strong middle class,” he said.
Asked why JFC was going into these markets only now, especially Indonesia which is ASEAN’s largest economy, Baysa said the company had tried to enter this market in the mid-1990s. “But after the Asian financial crisis in 1997, we got into problems so we pulled out of Indonesia. So I think it’s more [because] we didn’t have the organizational structure to properly grow into a serious venture in Indonesia.”
But this time around, instead of JFC breaking into these new markets by itself, Baysa said, it would find a local partner.
In the case of Indonesia, which has a population of 250 million, Baysa noted that there were only 130 stores of McDonalds, Jollibee’s stiffest rival. He noted that in the Philippines, JFC was “three years ahead” of McDonalds.
The strategy is to bring the group’s flagship brand, hamburger chain Jollibee. “So far we cant find the opportunity to buy a local brand in those ASEAN markets but if we’re able to find a good one and if it’s for sale, then that will be a good opportunity for us,” Baysa said, noting that in Vietnam, for instance, it had entered into a joint venture that controls the Highlands Coffee and Pho24 chains.