IntroductionTo ManagementStrategicManagement Plan for Jollibee Foods Corporation IntroductionJollibee isthe largest fast food chain in the Philippines, operating a nationwide networkof over 750 stores.
A dominant market leader in the Philippines, Jollibeeenjoys the lion’s share of the local market that is more than all the othermultinational brands combined. The company has also embarked on an aggressiveinternational expansion plan in the USA, Vietnam, Hong Kong, Saudi Arabia,Qatar and Brunei, firmly establishing itself as a growing international QSRplayer.Jollibee wasfounded by Tony Tan and his family with its humble beginnings as an Ice CreamParlor which later grew into an emerging global brand. At the heart of its successis a family-oriented approach to personnel management, making Jollibee one ofthe most admired employers in the region with an Employer of the Year Awardfrom the Personnel Management Association of the Philippines, Best Employer inthe Philippines Award from Hewitt Associated and a Top 20 Employer in Asiacitation from the Asian Wall Street Journal.Aside frompromoting a family oriented work environment, the brand’s values also reflecton their advertising and marketing. Jollibee knows their target audience verywell: the traditional family and all communication materials focus on theimportance of family values, making Jollibee the number one family fast foodchain in the Philippines and a growing international QSR player.
PESTEL Analysis POLITICALThe operations of Jollibee are affected by the governmentpolicies on the regulations of fast food operation. Currently governmentare controlling the marketing of fast food restaurant because of health concernsuch as cardiovascular and cholesterol issue and obesity among the youngand children in the country. Governments also control the license given foropen the fast food restaurant and other business regulation need to followsuch as for a franchise business. Good relationship with government in givingmutual benefits such as employment and tax is a must for the company tosucceed in any foreign market. McDonalds should also protect its workersby ensuring all the hiring, compensation, training or repatriation isaccording to Philippines Labor Law as stipulated ECONOMYAs a business entity, Jollibee need to face a lot of economicvariables outside its company or its macro environment. Dealing withinternational sourcing for its material McDonalds should be aware on the globalsupply and currencies exchange.
Remember, McDonalds import most of its rawmaterial such as beef and potatoes due to local market cannot supply inabundant to meet the demand of its product. Any upside of currencies especiallydollar will be impacting its cost of purchase. Working on the local country,Jollibee must face government regulations on tax of profit where it gains fromthe operation and other tax such as entertainment and restaurant service tax.Each country may have different scale or types of tax available and Jollibeeshould follow the regulation if it wants to continue the operation. As afranchise, Jollibee should also pay certain percentage of the revenue to theparent company in United States. The economic condition and growth of thecountry also is an important indicator to the demand of products that Jollibeeoffered.
As the food priced slightly above normal foods, not many people willhave the income range to consume the products. Moreover if the economy is badand income per capita is affected, the demand of Jollibee product willcertainly going down. On the other hand the good economy also means disposableincome is more and people can spend more on more expensive food at fast foodrestaurant SOCIALWhile more people are able financially to eat at moreexpensive outlet such as fast food restaurant, they have higher expectation.They want to have quality in services and more conveniences that candifferentiate one restaurant from another. Young urban consumers wanttechnology in their life and facilities such as credit card payment, wirelessinternet, cozy and relaxing ambient place, and other attraction for theirhangout and eating. All these needs should also be taken into consideration.There is not much difference between cultural and the purchase of products in asingle country but for different countries cultural sensitivity should beupheld. For example in India people (Hindu) do not take beef, Muslim countriesdo not take pork, German like beers, Finnish like fish type of food menu,Chinese like to associate food with something good (for example prosperity),Asian like rice and Americans eat in big-sized menu.
So far McDonalds has showngood efforts in localization of its menu to suit local taste but it shouldconstantly survey and learn about local culture to better understand and designthe best product for them.TechnologicalTECHNOLOGYFor a fast food restaurant, technology does notgive a very high impact on thecompany and it is not a significantmacro environment variables. However Jollibeeshould be looking to competitorsinnovation and improve itself in term ofintegrating technology in managingits operation. For example in inventorysystem, supply chain managementsystem to manage its supply, easy paymentand ordering systems for itscustomers and wireless internet technology.Implementation of technologycan make the management more effective andcost saving in thelong term.
This will also make customer happy if cost savingsresultsin price reduction or promotional campaign discount which will benefitsthemfrom time to time Porter’s Five Forces · Many alternatives and substitutes available · Price has a role · Differentiated products · Brand loyalty · Convenience SWOTANALYSIS RecommendationsShortTerm RecommendationsThe short termrecommendations for Jollibee revolve around Jollibee developing its fullpotential to become the next global player in the fast food industry. WhileJollibee has had success in emerging economies such as the Philippines,launching its brand in such an established economy, the United Kingdom, raisesconcerns. The reception of Jollibee in the United Kingdom could very welldetermine its fate in the entire international market. Jollibee needs to gaininsight into the culture of the UK through market research. Jollibee FoodsCorporation needs to understand the opportunities that exist in the UK marketsegment as well as learn about how to adapt to this slow diffusion culture. LongTerm RecommendationThe long term recommendations forJollibee concern the market entry strategy into the UK. In the past, Jollibeehas used franchising, acquisition, and joint ventures to expand globally.
Thisis evident through the franchising of Jollibee and Chow King stores throughoutAsia and the Middle East (Jollibee, 2014a). Jollibee acquired Greenwich Pizzaand has continued to grow that brand. Jollibee also has a joint venture withDeli France which has continued success (Jollibee Foods Corporation, 2003).
Therecommended strategy for entry into the UK would be through joint venture. Ajoint venture could be possible with companies such as Burger King. Burger Kingwas hit hard by the recent horse meat scandal and has been struggling to picksales up ever since.