Jollibee began as an ice pick parlour in 1975 and has evolved into a major fast nutrient corporation in the Philippines and legion other states in Asia. The company still continues to prosecute international enlargement and has been successful with 24 shops brining in over 9 million US $ in Europe. There have been many ups and downs in the procedure of international enlargement both inside Jollibee and from outside forces. Due to ends that were a small excessively judicious set and attempted to be achieved by Tony Kitchner. it is now up to Noil Tinzon to pick up the pieces and find what the best scheme is to be used for international enlargement. The three entry options he has to weigh are enlargement into New Guinea. adding an extra shop in Hong Kong and enlargement into California. His determination will determine the international division at Jollibee. Question 1

Jollibee was able to construct its dominant place in fast nutrient in the Philippines for a figure of grounds. The company had its roots in the nutrient industry in the Philippines early on with the ice pick concern. so the entry barrier into fast nutrient was really low. It was a smooth passage from being ice pick merely to fast nutrient after the oil crisis in 1977. This passage was besides aided by utilizing a formula that was developed in the Philippines and was appealing to the markets that were serviced by Jollibee’s. This would finally be a conducive factor in the competitory advantage Jollibee held over McDonald’s in it’s the Philippins. Jollibee besides built itself around the solid foundation of the “Five F’s” . Friendliness. flavourful nutrient. merriment atmosphere. flexibleness and concentrate on households summed up Jollibee’s doctrine and allowed for Jollibee to go a recognizable trade name throughout the Philippines. The operations and selling schemes employed by the company can be credited with set uping a dominant place through the antecedently mentioned actions. Once the Jollibee trade name was established. growing was necessary to go on the company’s success. The company was able to finance their growing wholly in house. They did non incur any debt or accrue any involvement in the procedure of turning. When we look at the Philippine’s civilization on disbursement. they save so pass and don’t peculiarly like to incur debt or pay involvement. Jollibee reflected the Filipino outlook.

The Tan household continued to be in control of Jollibee’s fate and provided stableness through the growing procedure. This stableness assisted in the company’s go oning success particularly in 1981 when McDonald’s entered the Philippines. When McDonald’s entered the market. Jollibee was faced with its largest menace. It was a David vs Goliath state of affairs in footings of resources and experience. Fortunately for Jollibee. it was better in melody with the local civilization. Jollibee’s place grown formula for its Burger was preferred to McDonald’s Burger in market research conducted in the Philippines. By being established in the Philippines prior to McDonald’s entry into the marker. Jollibee had set the saloon for rivals that were coming into the fast nutrient market in the Philippines. The outlooks of consumers were set by Jollibee and McDonald’s failed to fit the outlooks set by Jollibee. Even though McDonald’s had the cheaper monetary values and more intense international presence. consumers still chose Jollibee based on personal penchant.

They were willing to pay more for a Jollibee Burger that was spicier than wage less for a Burger they viewed as inferior at McDonald’s. Jollibee besides had luck on its side. The political and economic crises in 1983 slowed McDonald’s enlargement in the Philippines. When this happened Jollibee went for it all and expanded its nucleus bill of fare to include offerings seamster made for local consumers. Once the dust had settled from the political and economic crisis. Jollibee had expanded to 31 shops. therefore holding an even more dominant place in the fast nutrient market in the Philippines. When we look at what the best manner is for Jollibee to spread out globally. franchising may be their best option if it is done right. Highlighted by the failure of the franchise in Singapore. Jollibee realized that franchising has major booby traps.

Jollibee besides learned from McDonald’s that they need to pick the right spouses and the right location to be successful. In my sentiment. they struck out excessively many times. which cost them clip and money. with franchises in bigger states such as Singapore and Indonesia for a franchise to be successful in those states. However. with the success in Brunei aided by a soundless spouse who allowed for Jollibee to hold entire control over the operation. my idea is to hold franchises in the smaller states. It shows that it is imperative for Jollibee that they select the right franchisee in the right location for a franchise to be successful. Question 2

The two subjects of Tom Kitchner’s international enlargement schemes as the first caput of Jollibee’s international division are “targeting expats” and “planting the flag” . The first of the enlargement schemes was to aim countries where there were big Filipino populations working. This move finally failed because the markets that were chosen was limited by both upper and lower category penchants of Filipinos in other states. Although. this scheme seems like it would hold been a feasible scheme. Kitchner should hold been more prepared through market research or usage of primary or secondary informations about the demographics populations that were being targeted to recognize this scheme would non be effectual. This scheme had possible to be successful if gone about the right manner. As mentioned before. a small spot of market research or even looking into the companies past failures in bigger states could hold aided in his targeting of countries with high populations of Filipino exiles. The 2nd scheme. “planting the flag” . was based around Jollibee being the first-mover in fast nutrient wherever Jollibee expanded to. This was evidenced by the enlargement into Brunei. which was a success.

Jollibee was able to acquire into Brunei. set up itself and go successful prior to the infiltration of McDonald’s and KFC. They had a similar built in competitory advantage. similar to the advantages held in the Philippines as referenced in inquiry 1. in Brunei and were able to fend off challenges from the bigger fast nutrient companies. This would hold been my preferable attack because it had worked in the yesteryear and it led to sustained success. It’s non surprise that this led Jollibee to take the “plant the flag” motion. As mentioned in the instance. there are ruins to this attack. The trade name had to make a certain degree of gross revenues in order to truly advance and publicize the trade name. This would be troublesome if gross revenues were low or if the figure of shops necessary to do money was non possible. Jollibee would besides necessitate to number on a franchisee to set up the money to construct trade name consciousness. which would non ever be the instance.

This would necessitate happening a franchisee that could be trusted. which as evidenced by the failure in Singapore. and that could be debatable. In the terminal. I don’t believe his scheme was focused plenty to accomplish success. He strayed off from what had made Jollibee a success and that hurt the corporation. It’s really possible that his clip with Pizza Hut had corrupted his thought when it came to Jollibee. Pizza Hut was an international trade name that was really different from Jollibee in about all facets. He expanded excessively fast from November 1994 to December 1996 without a focussed scheme. He wanted excessively much excessively shortly for Jollibee and that ended up aching him and Jollibee in the terminal. He should hold adopted a quality over measure attack when spread outing Jollibee. This means that he should hold chosen to set up success in a few countries and non worry about how many shops were opened. Question 3

When Noil Tingzon took over as General Manager of the International Division of Jollibee. he instantly faced three options that would determine the hereafter of Jollibee. His three picks were to spread out to Papua New Guinea. spread out its current base in Hong Kong and spread outing to California. where there are a high figure of Filipinos. The enlargement into Papua New Guinea would follow a way that has been successful in the yesteryear. This would represent the “plant the flag” scheme. The country offers an untapped market that is mature for a new fast nutrient entity. There are simply three fast nutrient shops that are ill managed and had late severed ties with an Australian poulet franchise. The phase is set to hold another Brunei type success. if the right spouses are selected. In order to cover the costs in the new market. three or four shops would necessitate to be opened. With a possible franchisee willing to open 5 shops. the state of affairs seems mature. In New Guinea. Jollibee would acquire first movers advantage and the franchisee would set up the money to fund the undertaking. By traveling back to its roots by non put on the lining any debt or involvement. avoiding direct competition while constructing the base and acquiring consumers to put outlooks for rivals. Jollibee would return to patterns that contributed to the early success of the company.

The booby traps of the New Guinea investing program are the hazard that the consumers will non wish the merchandise. a rival may travel in that entreaties more to clients before the trade name consciousness can be built by the franchise and the cultural differences may be excessively different to get the better of. In order to win in this enterprise. the franchisee will necessitate to understand what is expected so there are no dissensions and the locations will necessitate to be chosen with about no mistakes. Of the three options. in my sentiment. this would be the safest based on past experiences of the company being successful as the first mover in an country where there are limited rivals. That is what the trade name individuality for Jollibee should be. it’s what they have a path record at being good at. The 2nd option of opening a 4th shop in Hong Kong is non every bit appealing as the New Guinea option. The current inability of the current shops to plunge themselves into the civilization in Hong Kong along with the operating issues need to be resolved in the current shops before opening a new one. It makes no sense to spread out in a market where you are already holding issues.

It would be wise to rectify the current issues and so reevaluate the scenario and see if a 4th shop is necessary if the current three are booming. However. opening a 4th shop in the suggested country would better the consciousness of Jollibee in Hong Kong. leting locals to go more familiar with the trade name something that may hike the gross of all the shops in Hong Kong. This would non be the pick for me if I were playing the function of Noil Tingzon. The 3rd option of spread outing to the United States is really appealing. By tossing the book on McDonald’s and spread outing in their backyard. Jollibee would be puting itself in the biggest market for fast nutrient. the United States. Although the logical thinking may be off. believing success in Guam would take to success in the United States. I like the move. With a big Asiatic contingent. including Filipinos. in California the base may be at that place.

We have antecedently seen this thought antecedently fail in Saudi Arabia and other topographic points. but market research may demo Jollibee is wanted or needed in California. If the research shows informations that supports favourable outlooks of a California enlargement. it could be done. Tonss of analysis of shop locations. the figure of shops needed to do the enlargement profitable. cultural jobs and franchisee options would necessitate to be done every bit good. Jollibee would besides be confronting utmost competition it had ne’er faced before. Americans may non prefer their Burgers or bill of fare and trusting merely on Filipinos for concern would non back up a long stay in America. For Jollibee this would be a entire civilization daze for their company. They would now hold to pull off shops that were 8 time-zones off. This is why a thorough analysis of all options in California would necessitate to be necessary. This is the riskiest of the moves. This move has the most upside. if successful could open up more of the United States for Jollibee to spread out to. In the terminal. my picks rank as New Guinea. California and so Hong Kong.