Add a dash of innovation and see profits rise, says French baker founder, CEO

Johnlu Koa

Johnlu Koa shook the local food scene in 1989 when he founded The French Baker Inc., which introduced Filipinos to French-inspired breads and pastries.

He has not looked back since, later establishing Lartizan and then bringing in Chatime from Taiwan in 2010 as the Philippine franchisee.

Koa is also responsible for the success of Van Laack, a European chain of men’s and ladies’ clothing.

Koa prepared himself well to succeed in the business world.

He completed his BSBA and MBA degrees, with honors, from UP Diliman and then taught marketing in the same university from 1989 to 1995.

His company, The French Baker, won the Agora Award in 1994 as the “Marketing Company of the Year”.

In 1997 he received his TOYM award for Entrepreneurship.

In 2005, he received the second highest recognition given by Ernst & Young as the country’s “Emerging Master Entrepreneur”.

Koa is an advocate and active mentor of GoNegosyo since its founding in 2005 and continues to share his knowledge with budding entrepreneurs.

Here, he shares his insights on innovation.

Q: How did you come up with the name ‘The French Baker’?

A: I’ve been a Francophile ever since I visited Paris in the early 80’s. Since France has become synonymous with the fine arts, culture, haute cuisine as well as haute couture, I wanted a brand that could be associated with those traits and eventually create a desirable image for my new business, hence The French Baker. Another reason was that I wanted to achieve a quick and automatic brand recall. I wanted to be first in the category of “French bakery-cafe” in the Philippines. I knew it would be challenging and I needed a brand that must be unambiguous.

Q: The French Baker was launched in 1989 with many innovations—onsite baking of breads in malls normally available only in hotels, no preservatives, premium price and no media advertising. What was the inspiration behind these?

A: At that time, it wasn’t difficult to imagine that customers would easily be captivated by the sight of freshly-baked breads being baked inside our stores. With exciting new breads like baguettes, croissants and Danish pastries, we inadvertently created what would become an emerging new category in the QSR called “French bakery-cafe” that we continue to dominate up to today.

I was inspired by my first backpacking trip to Europe in 1985 where I saw first-hand how consumers were willing to queue up several times a day for freshly-baked breads in several Parisian boulangeries. That image stuck to my mind until 1989 when SM malls offered me a lease space that allowed me to execute a fresh bakery-cafe concept which was to become my first The French Baker store .

Q: What are the keys to success in launching an innovation?

A: For me, it’s always been about timing and being ahead of the pack. In time “Me-Too’s” tend to fall short of market expectation especially about being better than the original. I’ve seen a lot of these in our industry. In fact many have challenged The French Baker in the past and have given up. Another key to success is the organization’s ability to continue innovating in order to keep up with the times. In the late 80s The French Baker was all about freshness by launching its half-price sale half an hour before closing time. Images of wiped out bread shelves soon created news and word-of-mouth advertising that quickly spread around the metro that at The French Baker, absolutely nothing was left behind for sale the following day, hence genuine freshness. In the 90s it was about “all-natural” baking without the use of chemical preservatives which industrial breads sold in supermarkets couldn’t do without due to their customers’ preference for long product shelf life of at least 7 days. In the 2000s it was about introducing several of the world’s favorite breads like ciabatta, english muffins, scones, belgian waffles, bagels, german pretzels etc. In the 2010s, it’s about artisanal baking and the use of natural yeast or sourdough. Soon it will be about gluten-free baking to serve the needs of gluten-sensitive individuals and others whose diets call for it.

Q: What are the mistakes you wish you did not commit in French Baker?

A: It’s very difficult to say which mistakes I wish I hadn’t  made because the same mistakes in the past had enabled me to pick up new learnings and insights in order to obtain the level of success which I presently enjoy. If ever there should be one mentioned, it would probably be certain projects that veered away from my core competency, believing that my partners would be the ones to carry the cudgels for me in terms of product and market-related strategies.

Q: You franchised Chatime from Taiwan in 2010. Why didn’t you create your own brand?

A: In 2010, I saw the emergence of a new specialty drink category in Taiwanese-based bubble tea products. I felt that while our group was very qualified to create our own, we didn’t have the luxury of time to develop and product-test our own version. Time was of the essence to be able to launch a new brand immediately. Together with my nephews and nieces who were in their early and late 20’s then, we launched Chatime in 2011. Today with over 70 stores and counting, we plan to reach 100 by year end.

Q: You are also into the luxury men’s fashion business. Can you share some of your insights?

A: Since I’ve been accompanying my wife Marilou to her fashion buying in Europe for many years now, I realized that there was a dearth of better value-for-money and quality men’s clothing in the Philippines. When I stumbled upon Van Laack (est. Berlin, 1881) through the same circle of colleagues and friends running Escada in Germany, I immediately realized the immense potential of the brand. After a few months of preparation, we brought it into the Philippines in 2012.  The brand specializes in luxury men’s shirts and ladies’ blouses in Germany. It’s reputation has never been tarnished despite the passage of time. Trivia has it that even our national hero, Dr. Jose Rizal, wore Van Laack during his stay in Germany! Since then, it’s been the brand for royalty and statesmen. —CONTRIBUTED