Jollibee's Overseas Localization

Jollibee's Overseas Localization

Global Expansion

Jollibee's success in the Philippines promotes its further expansion to overseas. In 1985, Jollibee started to expand internationally, but has experienced a series of failures in the early. Jollibee hired Tony Kitchner until 1994 and the strategy of global expansion was recognized by the directorate, starting a long-term expansion plans.

Problem Statement

Jollibee makes full use of the successful experience in the native and gradually begins the global expansion.

At the beginning，Jollibee chooses these countries, such as Vietnam and Brunei, which the fast-food industry is not well developed and have taste in common with the Philippines to open branches. After gaining success, it begins to fly to more countries, such as USA, Japan and so on. However, apart from the area gathered in the Philippines, it can often rely on the taste of the native to attract diners. Among other districts, Jollibee seems no longer so "happy" like at home. Even in the Middle East where there are a lot of Filipino overseas workers and these workers prefer to save up their money in the future to take home rather than spend it in Jollibee restaurant. Few people know that Jollibee even once in Xiamen opened a branch, because the door is so cold that it has to leave.

In fact, the international expansion of Jollibee McDonalds encountered the same problem - when they are in a certain place to achieve success, they optimistically imagine to do it again elsewhere in the same way. However, virtually local tastes are quite different. Since the implementation of the international, it causes that Jollibee lacks regional adaptability and cannot adjust the way to product timely.

Alternative Solutions

About organization:

a. The more flexible entry mode

b. Marketing investment in building image

c. Mergers and acquisitions of local corporations

About products:

a. The ability to manage the menu and the quality of products

b. First Mover Advantages (FMA)

c. Ability to adapt its product to local market.Local pride and nationalism

Recommendations

1997, Manolo Tingzon joined Jollibee and served as general manager of the International Department. He affirmed the strategy which target the new market segments in the Philippine overseas and worried about whether they will limit their chain of development. Meanwhile, in the face of New Guinea Island, California, three in Hong Kong and overseas expansion options, his choice for the future development of Jollibee is also very important.

In Brunei's success, the most important reason is that investors are willing to accept the Philippine headquarters' orders, thus reducing many of the contradictions between the both. In contrast, other areas, however, want a partner who led the operation of the store rather than accept Headquarters business jurisdiction. Therefore, the expansion mode selection and the mode in the joint venture partner of choice for Jollibee future overseas expansion are particularly important.

For these three options, if we were Manolo Tingzon'team, our views would be as follows:

1. In Island of New Guinea

It has a high risk for Jollibee to expend in the Island of New Guinea, in fact, in spite of the market is currently very small number of competitors. If they properly enter this market, then they can have the full first-mover advantage. The failure of previous experience in fast-food chain is worth learning, because the failure, one hand, is from the previous poor management, on the other hand caused by the relationship with the dealer. This makes Jollibee must be considered in the development of this market after whether there are likely to encounter problems with the dealer relationship, because it is likely to be its own characteristics with the local dealer. Once Jollibee suffered from such a variable, Jollibee in this market is still to fail. In addition, if they want to enter this market, Jollibee also need to improve their service and food quality, which is a huge cost for Jollibee. And if this little market fits 20 branches, then Jollibee probably cannot get much revenue, while Jollibee negotiate with dealers themselves may be paid out of capital market development costs. It is difficult to open immediately with 3 to 4 stores. Even though they made cooperation with the gas station, in the end, how many tourists are there in the gas station next to the hotel, whether tourists meet each store's turnover requirements are unknown. In addition, if their dealer has increased the number of branches borne by the funds required, and that