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A quick analysis of the industry that Jollibee operates in will bring to light several important issues
that it faces in different areas. The company started in 1975 and expanded quickly throughout the
Phillipines . Upto 1983, Jollibee faced no serious challengers. The entry of McDonalds into
Phillipines changed things, and it was during this year that Jollibee first invested heavily in
advertising.
Increasing globalization
Sourcing beef materials from different countries and locating in foreign markets both introduce the
company to global developments such as exchange rates and tariff and non-tariff barriers that
could potentially change how operations continue in the future.
The migration of large numbers of Fillipino workers to different countries is another factor to
consider and exploit.
Industry profitability
Minimizing the company's operating cost by creating an efficient production is one way to
increase its profitability. This can be done by adopting new technologies that can speed up the
company's operation. These can greatly help the company to capitalize on economies of scale.
The same concept forces other players to innovate and cause changes in the industry.
Jollibee-Marketing Analysis
Jollibee was started as an ice cream parlor and later discovered its destiny as a hamburger chain
in 1978. Jollibee has attained worldwide admiration in so short a time. Today, it owns Chowking,
Greenwich, Red Ribbon, and Philippine franchise of Deli France. It has become one of the
biggest fast-food chains in the world with more than1,600 stores worldwide.
Jollibee was able to attain a competitive advantage in Philipines over McDonald’s by doing
following things:
We won’t be going in detail on how Jollibee Philippines exactly work. We are here to analyze
the reason and principle of Jollibee Philippines’ success.
The corporation is actually known as Jollibee Foods Corporation. Oh and if you thought
that Jollibee was the only fast food chain operated by this coporation, boy are you in for a
surprise. To me, it seems like JFC owns a majority stake in all of the Filipino fast food niches. Do
you ever eat at Chow King? I know I love the halo-halo there, but did you know that in the year
2000, JFC acquired Chowking! That’s right, all the delicious oriental style fast food from Chow
King is operated at a high level by the same corporation as Jollibee. Oh and that’s not all. Seems
like Jollibee Foods Corporation has the idea that diversification is key to its future, and I think
they’re on the right track. JFC also bought out the popular fast food pizza restaurant known as
Greenwich Pizza. Additionally, in 2005, Red Ribbon Bakery became part of JFC. Keeping with
the baking theme, JFC acquired the French cafe and bakery known as Delifrance. The division of
JFC that handles business inside of the Philippines is known as Jollibee Philippines.
JFC has holdings in several other Asian countries including China and Taiwan. There’s a Chinese
fast food chain named Yonghe King in mainland China (based in Shanghai) that is owned and
operated by JFC. Another Chinese restaurant chain named Hongzhuangyuan was acquired on
September 21, 2007. This chain has 33 locations in Beijing and was purchased for the amount of
US $50.5 million.
Wow! I sure was surpised when I learned about all those acquisitions. It’s interesting to note that
when I walk into any of the chains above that they’re owned and operated by the same
corporation. I’m glad that Jollibee has a great track record with the Filipino community and that in
addition to the amazing Jollibee Philippines, they can offer us a variety of different foods
ranging from pizza, oriental food, coffee and baked goods. Yum!
Success in any industry is acheived by a variety of factors, amount of capital, market segment
targeting, values held by company founders and the type of people who are hired has a big
impact as well. Still, something that many companies lack to take them to the next level is the
organizational structure that allows the right people to be in the right place. There’s a saying that
goes: First you gotta have the right people on the bus. Then you gotta make sure each person on
the bus is sitting the right seat that’s designed specifically for their unique strengths. Only then do
you worry about where the bus is going.
I believe that Jollibee had the same idea when they introduced a host of changes to their
business beginning in 1994. These changes were mostly focused on creating more structure and
taking advantage of more resources. First of all, they hired Tony Kitchner, the first outsider vice-
president to handle their international operations. This was a key move to
separate Jollibee International from Jollibee Philippines. They introduced FSM’s, known as
Franchise Services Managers to help keep their franchise owners abreast of the new changes.
These changes were aimed at creating a “world class” view, and you could see some of the
changes visibly through the newly differentiated logo to the new packaging. They also instituted a
dress code change as well as began to recruit from outside.
Overall, these changes certainly kept Jollibee ahead of the game, as 10 years in the future, their
success would be so great as to garner the Entrepreneur of the Year Award by Ernst & Young for
founder Tony Tan Caktiong.
I honestly wonder what goes through the heads of fast-food chain management and founders
when deciding what their mascot should be. It must have been an interesting time when the
creators of McDonalds came up with the idea of a friendly clown dressed in red, yellow and white.
I guess things were a bit simpler for Dave Thomas when he named the franchise after his
daughter Wendy, though I would hesitate to call her a mascot. We all know how bad (or maybe
good?) things can get when a fast food chain brainstorms the brilliant idea of a talking chihuahua
that speaks in Spanish about how much he wants (or loves?) Taco Bell. Interestingly enough, not
all successful chains need a mascot (or maybe they weren’t memorable) in the case of chains like
Arby’s, but many do, like Jack of Jack in the Box and The King of Buger King – all normal people
with ridiculous masks or, um, heads.
Now what does this have to do with Jollibee in the Philippines? Well, many would
attributeJollibee’s success in the Philippines to its mascot, sharing the same name as the
franchise: the Jollibee. Is it a coincidence that Jollibee chose its mascot to be bright yellow and
red as well? Perhaps not – as gaudy as those colors may seem, they are more than vibrant
enough to catch the eye’s attention. These colors exposed to children who grow up
on Jollibee begin a lifelong association of bright yellow and red with delicious, affordable and fast
food. Reminiscent of the memorable flavors of popular condiments for hamburgers (or
Yumburgers) and hot dogs, the yellow and red bee namedJollibee is dressed in a chef’s hat
along with a shirt and blazer.
Jollibee’s smiling face is friendly enough to be a favorite among kids, and his face is prevalent in
many locations that include playrooms for children. Clearly, this cartoon figure is aimed at the
younger generation, but it does not alienate the older generation, especially these days, when
many of us have grown up eating Jollibee. It’s easy to say that this figure has been pivotal in the
branding and marketing efforts that have led to such success in the Philippines.
This next few post is in my personal point of view. I have friends and relatives that live on the
other parts of the world. They have shared all their experiences in dining at Jollibee fast food
chains. But one similar opinion they had is that not all Jollibee franchises are the same. They
have different tastes and hospitality when it comes to service. The food is somewhat different to
what we are served in the Philippines.
My friend in Hong Kong once told me, (the first Jollibee in Hong Kong) that the food is not as
good as it was on the Philippines. Is it because the Philippine native chicken better? However,
Jollibee is Jollibee no doubt, whereever you see that Jollibee mascot, that orange stiped honey
bee smiling at you, you can never resist!
Like any other franchise, fast food chains like McDonalds and Jollibee is one of the leaders in
providing employment for the Filipinos. It is said that 60% of all college students have had
experience in working in this fast food chains during their college days. No doubt, fast food
franchises helps the Philippine economy.
burgers, spaghetti, chicken and some local Filipino dishes with affordable prices. It is also known
as the leading fast food chian in the country with its main focus is to make every filipino people
Jollibee Foods Corp., the country’s largest food service company, reported a 17.2-
percent increase in its net income for the first quarter as sales in local and foreign markets defied
the global economic downtrend. In a disclosure to regulators, the company said that its system-
wide sales grew to P15.1 billion in the first three months of 2009, representing a 13.8-percent
increase over the same period last year. System-wide sales measures revenues from both
According to the report in the Phil.business week, sales from the firm’s foreign businesses grew
by 62.4 percent. Foreign operations account for 16 percent of Jollibee’s business compared to
only 13 percent last year, and only 3 percent five years ago.
The Jollibee chief stressed, however, that the company remains on track, despite the prevailing
economic turmoil. Jollibee has allotted P4 billion for capital expenditures this year, 37 percent
higher than what it spent in 2008. It plans to open 186 stores this year.
FRANCHISING OF JOLLIBEE:
• Willing to devote time to oversee the day to day operation of his restaurant;
Million.
- The investment includes the construction of the store, kitchen equipment and facilities, furniture
- The size of the property required for a restaurant is dependent on the store model that will be
- a person can still apply even if there is no location or site, but only applicants with applied sites
will be processed by Jollibee for now. In the meantime, Jollibee will include the interested person
- The restaurant profitability is dependent on several factors such as sales, market potential,
investment and the ability of the franchisee to control his operating expenses. Other questions on
-The franchisee is required to successfully complete a 3-month full time Basic Operations
- Jollibee will assist the franchisee in the recruitment and training of its management team.
However,this team will be employees of the franchisee who is responsible for their salaries and
1. Jollibee use market niche strategies to beat McDonald's. Well, in terms of global market
Jollibee is a mouse among the elephants but in the Philippines Jollibee control over 80%
share of hamburger and 55 % fast food market as a whole. Market niches Jollibee develop
products for their customer must also develop message tailored especially for their target
customer. Observe how they use communication tools as a niche to reach their AUDIENCE.
They target groups customer so that it meets their customer needs better than others. They
segment targeting, values held by company founders and the type of people who are hired
has a big impact as well. Jollibee has the same idea when they introduced a host of
changes to their business beginning in 1994. These changes were mostly focused on
creating more structure and taking advantage of more resources. First, they hired Tony
Kitchner the first outsider vice-president to handle their international operations. They
introduced FSM’s, known as Franchise Service Managers to help keep their franchise
owners abreast of the new changes. These changes were aimed at creating a “world class”
view, and you could see some of the changes visibly through the newly differentiated logo of
the new packaging. They also instituted dress code changes as well as began to recruit from
outside.
3. Many would attribute Jollibee’s success in the Philippines to its mascot, sharing the same
name as the franchise: the Jollibee. As colorful as those colors may seem, they are more
than vibrant enough to catch the eye’s attention. These colors exposed to children who grow
up on Jollibee begin a lifelong association of bright yellow and red with delicious, affordable
and fast food. Reminiscent of the memorable flavors of popular condiments for hamburgers
and hot dogs, the yellow and red bee named Jollibee is dressed in a chef’s hat along with a
shirt and a blazer. Jollibee’s smiling face is friendly enough to be a favorite among the kids
and his face is prevalent in many locations that include playrooms for children. Clearly this
cartoon figure is aimed at the younger generation, but it does not alienate the older
generation especially these days when many of us have grown up eating Jollibee.
4. Kids of all ages always asked for one thing when they are asked where they would want to
eat, and one cry would always echo, “Jollibee!” The Jollibee Foods Corporation has
expanded its reach to every part of the Philippines and is now expanding to countries with
Filipino communities giving them a feel home wherever they are right now. JFC has taken
change as a constant in their business, being able to adapt is the best quality any business
can have and to able to capitalize on the adaptation is the best effect any change can bring
forward. Over the years the Jollibee Foods Corporation changed in so many ways but still
managed to keep and strengthens its identity, the changes they made are those that made
their product and services better and kept true to their values thus giving them unimaginable
success and making them a true Filipino Fast food. Now, overseas Filipino workers (OFWs)
can now send Jollibee treats to their families and beneficiaries at home. Because of the
agreement between I-Remit and JFC OFWs can pay a visit to any I-Remit foreign office,
choose a variety of Jollibee meals and party packages, and have them delivered to their
families in the Philippines. The tie-up would break a barrier of distance by preserving family
tradition. Through this agreement, Jollibee can continue its long tradition of promoting
5. Jollibee’s food is especially designed and created for the Filipino people. No wonder, many
Filipino loves to eat in Jollibee for it suits the taste of majority Filipino and the hospitality of
service is somewhat different also as compared to other fast food chains. This is the reason
why Jollibee is a special place to eat because it makes the meals to the Filipino taste
6. Jollibee is one of the leaders in providing employment for the Filipinos. Is said that 60% of all
college students have had experience in working in this fast foods chains during their
nonprofit organization certified under PCNC (Phil. Council for NGO certification). Annually,
the JFC Family allocates 1% of its net profits to the Foundation to fund its work in all areas:
from community and leadership development, to scholarships and feeding programs even
The strategic corporate social responsibility (CSR) inititatives are mainly in the areas of
-Assisting small farmers develop their capability to grow and become potential
quadrant II “star” because it has a high market share based on its current reports, high
industry growth which is proven by the fast expansion and acquisition all over the world. It
has also the best long run opportunity growth and profitability based on the report that
EXTERNAL ENVIRONMENT
Operating Environment:
Supplier: The Jollibee Commissary System ensures the manufacture and distribution of safe and
high- quality food in the most cost-efficient manner. There are three Commissary System sites:
Santolan, Pasig City; Mandaue City, Cebu; and the central site in Canlubang, Laguna. The
System, which operates 24/7, manages Jollibee’s total supply chain process.
The Jollibee Pasig City commissary has production lines for breads and sauces, and is
the distribution center for North Manila and North Luzon. In 1996, Jollibee opened the Vismin
Foods Corporation (VFC) in Mandaue City, Cebu to service the Visayas and Mindanao areas
VFC has its own bread, pie, sauce, and frozen patty lines.
The Laguna commissary is the biggest and most advanced in the country and among
Asia’s best. Operated by Zenith Foods Corporation (ZFC), a full subsidiary of Jollibee, the newest
mechanized equipment, the production lines are for the marinated Chicken Joy, frozen patties
and pies, breads, sauces, hotdogs and other meat products, and dry blended goods. ZFC can
service over 800 Jollibee and Greenwich stores. The chicken marination line can produce as
many as 150,000 pieces a day while about 480,000 hamburger patties a day is turned out by the
frozen patty line. The breadline is designed to match the volume output of patties, i.e. also about
480,000 pieces a day. The pie line can produce as much as 157,000 pocket pies in a 20-hour
operating day. Currently, pies are exported to Jollibee stores in Hong Kong, Guam, Saipan,
Brunei, and the USA. Various sauce products are processed in the ZFC sauceline including those
for the Jollibee bestsellers, spaghetti and palabok. A professionally staffed Technical Services
Team supports the maintenance of an internationally accepted quality management system that
further ensures the quality and safety of the commissary manufactured food products. High
caliber teams from Engineering, Human Resources, Information Management, Finance and
Accounting likewise provide support to the Manufacturing and Logistics operations of the
Commissary.
Proof of Jollibee’s adherence to high quality standards is the various awards it garnered for the
commissaries: in 1997, the commissary in Pasig earned the Outstanding Industrial Plant in the
National Capital Region from the Laguna Lake Development Authority and the Most Improved
Industry awarded by the Sagip Pasig Movement while Commissary Plant Engineer Romy P.
Fernandez was awarded as one of the Top Ten Most Outstanding Pollution Control Officers of
the Philippines.
In 1998 also, the frozen patty line in the Pasig commissary was awarded an ISO 9002
body. 2004 is a banner year for Vismin Foods Corporation (VFC) who has been assessed and
certified by the National Meat Inspection Commission of the Department of Agriculture, to have
fully met the requirements and standards of Good Manufacturing Practice, reinforcing the
Labor:
There were 1,429 employees hired in Jollibee Foods Corporations. The company
provides scholarship in some of the selected schools for those who cannot afford to go to school.
The employee is given a 10,000 per semester and in return the employee will work the store for 4
hours or more. The store is also accepting or prioritizing students that wants to have a part time
job to earn extra income. They will be compensated based on the hours of work and a free meal
is given in every break. Like the other company, Jollibee is giving a double pay during holidays.
An award called employee of the month is given to the crew who really works hard and an
incentive is also given for the counter crew who achieved the highest sale of a particular product
depending on the manager. Thus, in this way an employee will be motivated to work hard. When
a particular contract ends an employee is given a separation fee based on the total number of
hours worked and a certificate is also given. For the manager, there will be a manager’s discount
Of course, there are also some controversies in some of the stores. One of the most common is
the stealing or eating of company’s products by some of their employees which is highly
consequences.
Customers:
The primary market of Jollibee is the Children. As you have noticed the structure of the
building and the theme is really to attract the kids to dine in the store. When you try to ask some
of the kids if where they would want to eat majority of their answer is Jollibee. Surely, Jollibee is a
store that every Filipino would love and respect. Their foods are made to suit the taste and
preference of every Filipino child. But, a child cannot go to the store without their parents thus,
this is not for the kids only but it includes also for the parents and to all people who loves to eat at
the store. Most of the company’s customers belong to a class A and class B people. These are
the people who have work and usually are professionals. But it doesn’t mean that the other
people who do not belong to this group cannot eat to the store. Jollibee is making some of their
prices of the products affordable so that everybody can eat in their store.
Jollibee being concerned of their customers, OFWs can now send Jollibee treats to their
families and beneficiaries at home. Thanks to an agreement between I-Remit and Jollibee Foods
Corp., OFWs can pay a visit to any I-Remit foreign office, choose a variety of Jollibee meals and
party packages, and have them delivered to their families in the Philippines. The tie-up “would
break the barrier of distance by preserving family tradition," I-Remit Inc. chairman Bansan C.
Choa said during the agreement signing on Friday. “This project is not solely for great business
proposition but it encourages preserving the values of family ties." Under the “‘Salu-Salo Padala
Treat Mula Sa iRemit,’ sending “great-tasting" Jollibee products to loved ones at home becomes
as easy as sending money whenever and wherever needed," Jollibee president Ernesto
Tanmantiong said during the same event. The partnership will also help OFWs ensure that the
funds they send home will be spent for beneficiaries’ birthdays and anniversaries, he added. I-
Remit is now in 26 countries and territories around the world. It also has 4,000 payout stations to
cater the remittances originating from its foreign offices to their designated beneficiaries in the
Philippines. Based on the information sheet, OFWs can send from any iRemit center in Australia,
Hong Kong, Singapore, Austria, Taiwan, United Kingdom, and Canada. “Through this
partnership, we can continue Jollibee's long tradition of promoting special bonding moments even
for our hardworking Filipinos overseas," Tanmantiong added. “By treating their loved ones in the
Philippines with their favorite meals whether during special occasions or simple family gatherings,
our OFWs can still contribute and be part of these family moments, even when they are miles
away from home." Filipinos working abroad can choose from five Langhap Sarap Family blowout
packages good for at least five persons, with prices ranging from P800 to P1,000. These five
treats are the Spaghetti + yum with Cheese Treat, the Chickenjoy + Yum with Cheese Treat, the
Chickenjoy Treat, the Burgersteak Treat, and the Chickenjoy + Spaghetti treat. The partnership
between the largest Filipino-owned non-bank remittance company and the Philippines’ biggest
fastfood operator is “very strategic," Harris E. D. Jacildo, iRemit president and chief operating
officer, said. However, the two companies declined to the partnership’s contribution will their
respective sales. I-Remit has also signed agreements with the Home Shopping Network to
Therefore, majority of its customers were satisfied and delighted of the food they served
and the quality o services they performed. In fact, one commented in some of the websites that
he always eats to the Jollibee because of its friendly atmosphere and the foods being served are
of great quality. The company also gives a discount of 20% for the senior citizens.
Creditors:
Jollibee foods corporations borrowed money from different financial institutions. Last
September 2008 the Company has just entered into an agreement to borrow money from several
financial institutions to fund its investments in the People’s Republic of China. The agreement
covers a loan denominated in Renminbi amounting to China Yuan seven hundred million (CNY
700 million, equivalent to about USD 100 million) to be paid in three years at a fixed interest rate
for Jollibee Foods Corporation and at a floating rate for the lenders at Libor plus 2.25%
Financial institutions include the Metropolitan Bank and Trust Company, Banco De Oro
Unibank, Inc., Rizal Commercial Banking Corporation and the Bank of Tokyo-Mitsubishi UFJ,
Ltd., Manila Branch as lenders; Metropolitan Bank and Trust Company as facility agent; and UNS
AG, Singapore Branch as the swap bank. The facility has been arranged by UBS AG, Hongkong
Branch.
Other sources of funds are the Investors and shareholders of the company like the Hyper
Jollibee Foods Corp. Fundamental Company Report provides a complete overview of the
company’s affairs. All available data is presented in a comprehensive and easily accessed
format. The report includes financial and SWOT information, industry analysis, opinions,
estimates, plus annual and quarterly forecasts made by stock market experts. The report also
enables direct comparison to be made between Jollibee Foods Corp. and its competitors. This
provides our Clients with a clear understanding of Jollibee Foods Corp. position in
theRestaurants and Leisure Industry.
Jollibee – Analysis
The case gives an idea about how the competition influenced Jollibee's strategy, both domestic
and international. Jollibee ,which was a Filipino chain of restaurants, was forced to change their
strategy with the entry of McDonalds in Philippines, which later transformed the company into a
global company .The company faced serious challenges with their international exposure. The
challenges included the conflicts with franchisees/Joint venture and conflicts between divisions.
Another issue that the company faced was the entry into Papa New Guinea, United States of
America and expansion plans in Hong Kong. The company has to consider the financial instability
it faces while considering their plans. In the analysis we have tried to cover the effectiveness of
strategies adopted by Mr Tony Kitchner (Former International Division head).