Jollibee Foods Corporation: International Expansion

JOLLIBEE FOODS CORPORATION: INTERNATIONAL EXPANSION

A Case Study

CASE BACKGROUND

Jollibee Foods Corporation (JFC) is the most successful fast food chain in the Philippines. It started out as an ice cream parlor owned by the Tan family, headed by Tony Tan Caktiong (TTC) as President. Brought about by oil crisis which doubled the price of ice cream, JFC diversified into hamburgers in the year 1977. Jollibee’s philosophy is epitomized by “Five Fs” – Friendliness, Flavorful food, Fun atmosphere, Flexibility in serving customer needs, and Focus on families. Though it began as a family business, eventually, it went public in 1993. JFC expanded its business through acquisition of other food chains but Jollibee stores remained the bread and butter of the parent company, contributing 85% of total revenues. Jollibee had grown quickly having a total of 223 stores worldwide by the end of year 1997.

Jollibee ventured into overseas expansion attempts since 1985 but were mostly unsuccessful due to location and partner issues. In 1993, TTC hired an Australian national Tony Kitchner (who was the former VP for International Operations in Pizza Hut for 14 years), to lead JFC International Division in order to push its international presence at full throttle. Tony Kitchner initiated many drastic changes in the division from modifying office design and dress code to pushing aggressive expansion strategies and rebranding Jollibee’s image offshore. Kitchner’s bold strategies strained the International Division’s relations with the Philippine-based operations.

After Kitchner left in 1997, a new head of the International Division—Manolo P. Tingzon, has been appointed by TTC. Apparently, Tingzon has to deal with the international expansion problems passed on by his predecessor. Of the various issues he has to resolve, he identifies three immediate growth opportunities which will certainly lay out the International Division’s future direction.

PROBLEM STATEMENT

How shall the International Division General Manager capitalize on the imminent overseas expansion opportunities using Jollibee’s existing capabilities in order to achieve 50% of JFC’s Total Sales in 10 years?

SWOT ANALYSIS

Strengths:

1. NO. 1 FOOD CHAIN IN THE COUNTRY

• Jollibee has remained the top food chain in the Philippines, beating McDonald’s. It is primarily attributed to the preferred taste of Filipinos and Jollibee’s appeal to families particularly children. It continuously conforms to its