The document summarizes the fast food industry in the Philippines. It discusses that the largest fast food chain is Jollibee Food Corporation, which operates brands like Jollibee, Chowking, and Red Ribbon. It also mentions that while the industry is growing steadily, concerns over unhealthiness and foreign competition are threats. The outlook is that fast food will continue growing due to popularity of dining out, but companies will need to address health concerns to stay competitive.

1. Fast Food Industry Ianne Patrick Santiago Marivic Mariscal Michael Lualhati Jay-ar de Castro Chaofan Zhu

2. Industry Background

3. Prepared and served quickly in a restaurant. Inexpensive foods. Begins on the mid-twentieth In the Philippines, fast-food restaurants specialize fried chicken, french fries, burgers, spaghetti and a beverage. The largest fast-food industry in the Philippines is the Jollibee food corporation. Jollibee Corporation is composed of several fast foods chains like Jollibee, Chowking, Greenwich, Red Ribbon and Mang Pepe's. Quick Service Restaurant or QSR Definition

4. Fast Food Operation

5. Nationwide market coverage Caters to all ages / broad market segment Slow service vs. commitment to quick food preparation Menu is limited to the products the store offers Lack of food stock Space for fast food is small Capacity is 100 sq m at the minimum Cleanliness of the store sometimes is not properly maintained due to underman staff. Scope and Limitations

6. Regulated by the Department of Trade and Industry. RA 7394 or the Consumer Act of the Philippines. Department of Health and Bureau of Food and Drugs According to Omana (2005), the fast-food market is dominated by the Filipino-owned Jollibee Foods Corporation with 52% market share. It is being followed by American food brands like McDonald’s, Wendy’s, Burger King, and KFC. Total Industry

7. Key Player / Brands Jollibee Food Brands

8. Market Structure

9. Population growth rate more than 4% per year. Consumer preference: quick, quality, clean, convenient, and affordable dining experience. Customization products (e.g. rice meals for Filipinos, potato fries for Americans) Domestic: 3-8% annual growth rate in the Philippines Average annual income of Php 62,000 for “poor” families and Php 268,000 for “rich” households. Market Structure - Demand

10. Status – Domestic Fast Food: Entrants of foreign cuisine (e.g. Asian, European, Western) Jollibee as market leader for Philippine Fast Food Export: Jollibee branches in other countries (Middle East, North America, Southeast Asia) Chowking’s expansion abroad Projections: Improving food and service quality over time Expansion by opening more stores Product Development Market Structure – Demand (cont.)

11. Mixture of local and foreign brands: Jollibee (operated by Jollibee Foods) McDonalds (locally controlled by Alliance Group) Domestic: Market Structure – Supply Sources: Annual Reports from JFC and AGI and corporate websites.

12. Imports: Rice importation Other products Projections: Largest index of value among other industries Continuous increase in population Sales growth of leading brands Business expansion Market Structure – Supply (cont.)

13. Cost and Prices: Ala-carte meals at Php 50-150 Combo meals at Php 82 on the average / Premium items at Php and above Factor goods (Source: Bureau of Agricultural Statistics, 3/2011) Market Structure – Cost and Prices Commodities Average Price (in Php) Potatoes 60 / kilo Ground Beef 240 / kilo Well-Milled Rice 35 / kilo Cooking Oil 54 / liter Dressed Chicken 130 / kilo

14. Average of 100 seats for dining customers Number of Consumers: 200 pax / branch / day (at 110 sq. m store size) Number of Transactions: 100 orders (from 11AM-2PM) Number of Meals per Transaction: two (2) meals Market Structure – Capacity Utilization Source: Mang Inasal Baclaran branch

15. Financial Structure

16. Financial Performance Jollibee Foods Corp grew a net profit last year by 16 percent to P3.09 billion Financial Structure

17. Financial Structure

18. Strengths , Weaknesses, Opportunities and Threats

19. SWOT Analysis Strengths: Quickest Serving Time Among Other Food Industry Cost Saving / Systematic Food Preparation Option to Deliver Food to Houses, Offices, and Other Establishments Wide-Range of Food Options/Choices Customization of Meal Servings Tailor-Fit to Consumers’ Appetite Positions in Strategic Location in Populated Areas Flexibility on Preparing Food Time Weaknesses: Product Development for New Offering Takes Too Long / Does Not Change Products Often Known to Serve Unhealthy Meals Limited Menu Offered to Consumers High Employee Turnover (Operation) Opportunities: Growing Philippine’s Economy per Capital Continuous Products and Service Expansion Adaptation on Products and Services to Culture and Tradition Threats: Consumers Look for a Healthier Lifestyle Industrialization High Number of Foreign Companies Entering the Fast Food Market vs. Local Brands Non-Compliance to Sanitary Standards

20. Strategic Trends

21. Current Trend for Fast Food

22. Strategies Strategies Strengths / Weaknesses Addressed Opportunities / Threats Addressed 1. McDonald’s “Made-For-You” Strengths: 1. Quickest Serving Time Among Other Food Industry 2. Flexibility on Preparing Food Time Opportunity: Adaptation on Products and Services to Culture and Tradition Threat: High Number of Foreign Companies Entering the Fast Food Market vs. Local Brands 2. Freebies and Budget Meals (All Brands) Strengths: 1. Customization of Meal Servings Tailor-Fit to Consumers’ Appetite 2. Cost Saving / Systematic Food Preparation Weakness: Limited Menu Offered to Consumers Opportunity: Continuous Products and Service Expansion 3. Healthy Meal Offerings Weakness: Known to Serve Unhealthy Meals Threats: 1. High Number of Foreign Companies Entering the Fast Food Market vs. Local Brands 2. Consumers Look for a Healthier Lifestyle

23. Outlook and Summary

24. Fast food industry will continue to grow Extreme popularity of dining outside more than 18% of total food expenditure went toward food for consumption outside of the home (Agri-Food Past, Present & Future Report 2007) Popularity of food retailers in malls and shopping centers than shops-on-site Filipino consumers are by nature price-sensitive best value for money (value menus) Popularity of items sold for around PHP25 or PHP50 Outlook / Summary

25. Fast food industry has helped to transform not only diet, but also landscape economy, workforce, and popular culture Whole experience of buying fast food has become so habitual Outlook / Summary

26. Conclusion and Recommendation

27. Opportunity for economic growth Rapid increase of opening new food chains Exploring the international market helps advertise our country that we offer good food markets tourism and build awareness increase sales of the company strengthens GNP Conclusion And Recommendation

28. Rising concerns for “health and wellness’’ Offer nutritional items on the menu Possibility of creating a policy that will address the health and wellness concern Positive brand - promote an ambience of being caring to customers Conclusion And Recommendation

29. Thank You