Fast food industry
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Transcript of Fast food industry
Fast Food IndustryIanne Patrick
SantiagoMarivic MariscalMichael LualhatiJay-ar de Castro
Chaofan Zhu
Industry Background
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
Fast Food Operation
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
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
Key Player / Brands
Jollibee Food Brands
Market Structure
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
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.)
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.
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.)
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
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
Financial Structure
Financial Performance Jollibee Foods Corp grew a net profit last year
by 16 percent to P3.09 billion
Financial Structure
Financial Structure
Strengths , Weaknesses, Opportunities and Threats
SWOT AnalysisStrengths:
Quickest Serving Time Among Other Food IndustryCost Saving / Systematic Food PreparationOption to Deliver Food to Houses, Offices, and Other EstablishmentsWide-Range of Food Options/ChoicesCustomization of Meal Servings Tailor-Fit to Consumers’ AppetitePositions in Strategic Location in Populated AreasFlexibility on Preparing Food Time
Weaknesses:
Product Development for New Offering Takes Too Long / Does Not Change Products OftenKnown to Serve Unhealthy Meals Limited Menu Offered to Consumers High Employee Turnover (Operation)
Opportunities:
Growing Philippine’s Economy per CapitalContinuous Products and Service ExpansionAdaptation on Products and Services to Culture and Tradition
Threats:
Consumers Look for a Healthier LifestyleIndustrializationHigh Number of Foreign Companies Entering the Fast Food Market vs. Local BrandsNon-Compliance to Sanitary Standards
Strategic Trends
Current Trend for Fast Food
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 TraditionThreat: 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’ Appetite2. Cost Saving / Systematic Food PreparationWeakness: 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
Outlook and Summary
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
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
Conclusion and Recommendation
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
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
Thank You