Europe, next target for Jollibee expansion

Local fastfood giant Jollibee Foods Corp. (JFC) plans expand into new territories in Europe next year, as it embarks on an aggressive expansion both locally and internationally in a bid to increase sales from the overseas business over the next seven years.

“There are some markets (abroad that there are) OFWs (overseas Filipino workers) so we are also looking into that. We are thinking of getting into Italy probably not this year. It can be next year,” JFC chairman and chief executive officer Tony Tan Caktiong told reporters.

JFC operates the largest food service network in the Philippines, with 2,493 outlets under the Jollibee, Chowking, Chowking, Greenwich, Red Ribbon, Mang Inasal and Burger King brands. It operates another 650 stores overseas.

Tan Caktiong said Japan and Canada are other potential markets for overseas expansion, apart from the company’s core markets –Philippines, China and United States.

“The other new markets will still be the OFWs markets. It will be the US, but there will be new cities, for example, we are going to Chicago this July. We are now going to enter Manhattan in New York and even in Florida,” he added.

In 2016, Tan Caktiong said the company will open 80 to 100 stores overseas, and 200 stores in the Philippines.

He targets a revenue mix of 50-50 percent in operations locally and overseas in seven years.

JFC chief finance officer Ysmael Baysa said the current revenue mix is at 80-20 percent in favour of Philippine operations.

“It will change so far a little because the Philippines is growing so fast and so foreign countries are also growing so fast. That is why, the ratios are hardly change,” he said.
The company is more than doubling its capital expenditure (capex) to P10.4 billion in 2016 from P4.7 billion last year. The bulk of the planned capex or P7 billion has been earmarked for new stores and renovation.

JFC Chief Executive Officer Ernesto Tanmantiong said 70 percent of 200 new stores planned for this year will be located mostly in the Visayas and in the provinces.

“As we grow to the provinces, we started opening more stores and we think the opportunity is still big, there is less competition. It is more of the growth opportunity; we have not yet saturated the market so the growth potential is still very huge in the provinces,” he added.