C A S E
Leonardo R. Garcia, Jr.
De La Salle University
The Taste that
Conquered a Nation
NUS Business School
National University of Singapore
When someone says "fast-food restaurant", what is the first name that comes to mind? Chances are good that it's McDonald's, the world's largest food service organization. McDonald's holds 20% share of the U.S. fast-food market, triple the share of closest competitor Burger King, and is rapidly expanding its worldwide presence. Ask the same question in the Philippines, however, and the first name uttered will likely be Jollibee. In the grand scheme of global commerce, Jollibee Foods Corporation isn't exactly Et household name. But in its niche-the Philippines-it is king of the burger market. In fact, Jollibee is the largest homegrown fast-food chain in the Philippines, outperforming even the global giant, McDonald's, in the Philippines' fast-food scene. Even in its overseas branches, Jollibee is able to compete head-on with global players like McDonald's, Burger King and Carl's Jr, winning over both Filipino and non-Filipino customcrs. Jollibee develops, operates and franchises the Jollibee hamburger fast-food concept, the Greenwich Pizza-Pasta fast-food concept and other food retailing concepts in the Philippines and in 25 international stores in the following countries: the U.S., Hong Kong, Brunei, Saipan, Guam, Vietnam, Indonesia, Dubai and Kuwait. In 2000, Jollibee achieved system-wide retail sales of up to PhP19.8 billion (US$390 million),
Copyright C Garcia and Wirtz. 2001. Dr. Leonardo R. Garcia, Jr., Certified Professional Marketer (CPM-Asia Pacific), is the Director of Graduate Studies, College of Business and Economics, De La Salle University, 2401 Tart Ave., Manila Philippines. E-mail email@example.com. Dr Jochen Wirtz is Associate Professor of Marketing with the NUS Business School, National University of Singapore, 17 Law Link, Singa pore 117591. E-mail: firstname.lastname@example.org
This case was prepared as a basis for class discussion rather than to illustrate effective or ineffective handling of an administrative situation. The authors gratefully acknowledge Jasmine A C. Ow for her excellent research assistance in gathering data and assisting with the write-up. The exchange rate was Php51.25:US$1 in •June 2001 when the case was written.
an increase of 23.9%; over 1999, with consolidated total revenue that reached PhP15.4billion ( U5$310 million 1 which was an increase of 19.2% over 1999.
HISTORY OF JOLLIBEE
Filipino-Chinese Tony Tan Caktiong and his brothers started Jollibee in 1975 when they opened a two-branch ice cream parlour in Manila's commercial districts of Cubao and Quiapo. After running the ice cream business successfully for the first few years the Tan brothers expanded the menu to include hot sandwiches, burgers and other meals that eventually outsold the ice cream. In response to the growing popularity o their burgers -made from their mother's secret recipe-and the other hot meals, Tom Tan and his brothers formed the Jollibee Foods Corporation (J FC ) on January 28, 1978 Instead of recreating a fast-food outlet that serves standardized meals as those found in the U.S., the Tan brothers decided to develop their own brand, complete with a mascot and menu that would appeal to the Filipino palate. Hence the creation of the mascot, a jolly bee. Jollibee was conceived as a fast-food outlet of high quality but reasonably-priced food products tailored especially for the Filipinos, who are served b, the jolly, "busy-as-a-bee° restaurant crew Since its inception, Jollibee has experienced phenomenal growth that saw it making its way into the ranks of the top 100 Filipino corporations in 1981. By 1989. it became the first Filipino fast-food chain that...
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