Fast Food Industry
I Source: Food and Agro Business Monitor, October 2001; Company websites; News articles One testament to the windows of opportunity and growth in the industry is the rise of Mango ‘nasal, the country’s fastest growing barbecue fast food chain, which after only eight years, is already 390 stores strong as of July 2011. Despite the presence of industry giants and having been established first in the Visas, Mango ‘nasal has shown that there is enough room for new players given the right product at the right price. As in the past, Jollied sensed an opportunity and acquired a controlling share of Mango ‘nasal.
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On the other hand, Jollied sold its Deliverance business unit and stopped operations of its carrier-inspired food chain Mango Epee stores, which will eventually be converted to its other brands. Owing to the popularity of coffee hops and the Filipinos growing penchant for drinking coffee, Jollied also entered the coffee shop business through a Korean-based restaurant brand, Cafe It-ammo. It was launched in 2010 and has already three branches offering Goleta and coffee in a business as a strategy to gain market share and offer a less expensive but quality coffee experience.
Most of the other major players in the industry have also expanded led by Pizza Hut, McDonald’s, and Shakes. Some Jollied mandolin’s stores in Metro Manila are undergoing renovation to improve store appearance/image and better serve its customers. Chicken many KEF slowed down partially due to the effects of the Asian financial crisis to the Armco Group but it has since recovered. In 2008, Armco acquired Tokyo Tokyo, the country’s leading Japanese fast food chain. Armco also owns the master franchise of Mister Donuts in the country which has over a thousand shops nationwide.
Products, Variety, and Value-addition The major traditional types of fast food chains are still the hamburger chains, chicken houses, pizza/pasta parlors and Chinese food chains. However, other fast food chains are catching up like the donuts chains, coffee shops, barbecue houses, bakeshops and Filipino food chains. While the food offerings in fast food stores are essentially within the type for which the chain was established, the available products are already a mix of food items wherein the banner product may not be the most popular. Jolliness’s Chicken]oh, for instance, may be as popular if not more popular than its Hamburger.
It also has Filipino dishes like beef tap (smoked beef),longhairs (local pork sausage), and crispy Bangui (militias). Chocking, a Chinese fast food, has also Filipino food like benevolentness, kangaroo (water spinach), longhairs, beef tap and halo-halo. McDonald’s, a burger chain, also has longhairs in its menu. Roasted chicken chain Kenny Rogers, for its part, offers other food items for the health conscious like roast chicken, healthy plate, high protein meal, high fiber meal, low calorie meal, grilled chicken/sausage/fish meals, and vegetable salads.
KEF, Pizza Hut,Shakes, and Wend’s also have vegetable salads in their menu. Wend’s was first to offer a salad bar and the first fast food to enter into a memorandum of agreement with the Department of Health in support of its Healthy Lifestyle Campaign. There is also continuous new product development eke Cuff’s Double Down (all-meat, no-bun sandwich), Wend’s shrimp sandwich and abstractor, Showing’s Chinese-style fried chicken, and Jolliness’s crunchy chicken burger, sweet and sour meatballs and chicken nugget crunchers.
Part of product development is seasonal offerings especially during Lent, when people try to fast and abstain from meat. Some products that come out at this time are tuna pie and fish twister. Other than the product mix and variety, fast food chains also offer affordable alternatives for the budget-conscious. The price of the budget items can range from a low of POP. O for a Burger McCoy or apple pie, POP. O for Jolliness’s beef with mushrooms and rice to a high of POP. O for Cuff’s Wow Slit Meal of I-piece chicken, rice, and regular drink (Table 3). Table 3.
Value for Money Food Items, July 2011 | Company I Budget Food Items I Price (PH) I Jollied I Rice Meal errs, Value Meals | 39. 00 – 55. 001 Chocking I Value Kings, combo Kings 1 29. 00-87. 001 Mango ‘nasal I Slit Meals, Built Meals | 49. 00 | McDonald’s I Value Meals, Massacre Meals, Everyday Massacres | 25. 00 – 55. 00 | KEF I wow Burger, wow slit Meals 1 30. 00-89. 001 Wend’s I super value Menu | 37. 0 – 62. 001 Source: Company websites; internet search Over the years, fast food chains have also added a new value to their relationship with loyal customers with the use of patronage cards.
Some of these cards include Shakes Pizzicato Supercargo, Pizza Hut’s Palm card, Angel Pizza’s Privilege card, mandolin’s Midnight card. For the pizza chains, the card allows the customer to buy one box of pizza and take one box for free. On the other hand, the Midnight card allows customers to get free items on orders from 12:01 am to 3:59 am. The promotions are valid only within a prescribed period. A Still Growing Industry A number of factors and strategies, both external and internal to the fast food industry, are contributing to its continuing growth.
Boos The growth of the business process outsourcing (BOO) industry has enhanced the eating out habits in the country as Episcopalian have a 2417 work schedule. Major fast food chains have adapted to this changing lifestyle with a 2417 restaurant business hours in strategic locations close to the Boos. McDonald’s and Wend’s were one of the pioneers in the 2417 delivery service. Given the company websites, there is also the facility of ordering on line and allowing fast foods in Backbone and Twitter.
Locations expansion of malls and supermarkets around the country is another plus factor for the fast food industry. The on-going and planned Allay, Purebred, Robinsons, Shoppers and SMS establishments will be providing the space and foot traffic for the fast food chains’ expansion. Pricing Value pricing or value meals will continue to be a strategy for fast food chains, as surveys still indicate low prices as a reason for choosing a fast food restaurant. Another price proposition is the unlimited rice promotion of some stores like Mango nasal, Tokyo Tokyo, and recently, Tropical Hut.
Movie tie-ins Another strategy to stimulate frequent store visits is the fast food tie-in promotion of hit movies with the offering of limited edition gadgets, collectibles, and food items like Captain America in Jollied and Dunking’ Donuts and Transformers in KEF. McDonald’s is also offering Coca Cola can glass collectibles. Branding Fast foods also use a sort of “multiple-branding” to draw more customers by offering a large number of items whereby several fast food chains are located side by side. This is the case of Jollied beside Chocking, Greenwich, and Red Ribbon.
Chains like the Armco group have also started co-branding where a Mister Donuts kiosk is in a KEF store. Bank tie-ups As a meaner to increase patronage of credit cards, companies like the Bank of the Philippine Islands, Banc De ROR, and Metronome have tied-up with some fast food stores where customers can redeem promotional freebies based on amount charged to their credit card. The fast food stores include Jollied, Chocking, Mango ‘nasal, Backlog ‘nasal, Goldbricks, Greenwich, and Pizza Hut. This win-win scheme is expected to enhance repeat usage for credit card companies as well as increased sat food store visits.
Value propositions some fast food stores provide newspapers and free Wi-If internet connection. Many chains are also remodeling their facilities; expanding their selection of desserts, beverages, snacks and breakfast items; adding grilled items; reducing fat and sodium; and catering to customers with diabetes or gluten intolerance. Some chains, particularly in developed countries, are also catering to a broader range of customers with hall-only or kosher food in their menu. Major companies have also set up foundations which implement their corporate social responsibility initiatives.
Prospects There is a lot of optimism and positive outlook as expressed by major players. Jollied Foods Corporation has revised its target upwards in 2011, and plans to open 160 stores in the country across all its brands. The company is looking at a 12-15 percent growth for the year with expected brisk sales and lower raw materials cost, and provided there will be no major spikes in inflation and petroleum prices. Mango ‘nasal for its part is targeting to hit 500 stores by 2012. McDonald’s is planning to build 20-30 stores every year in the next five years.
For instance, artificial strawberry flavor food The regular consumption of Junk food is the leading factor in obesity and excess weight. Obesity is second only to smoking as a cause of death in America. 46 percent of Canadian adults are either overweight or obese, with obesity in children increasing threefold over the past two decades. Consumption of soft drinks containing sugar has been linked to weight gain and an increased risk for development of Type 2 diabetes. Studies have revealed that obese people have wick the rate of chronic health problems as people of normal weight.
This includes 100-percent greater chance of developing Type 2 diabetes, 50-percent increased likelihood of developing heart disease. Obese men are nearly 90 percent more likely to get colon cancer. Junk food diet is a major cause of heart diseases. High cholesterol resulting from Junk food puts undue strain on the liver, causing long-term damage to this essential organ. Research has suggested that diets high in fat may also impair essential brain functions, like concentration and memory. The nun food facts about soft drinks alone are alarming.