Jollibee Shortcomings

Jollibee is simply put, a successful food chain based in the Philippines with thousands of food chains and franchises entrenched in its roots. If we scour its bottom line financial status (earnings, store expansion, market penetration, etc.) as a barometer for success, then research done on this paper would inevitably be futile. However, there is more to discover on the pathos side that the brand has accordingly tapped, the core unto which this paper aims to fathom. It is unto this that these questions arise: Numbers aside, how did Jollibee overcome its shortcomings against its much superior competitors during its early growth phase as it became the most successful fast-food chain in the country? And how, specifically, did this company redefine

It soon incorporated within 3 years of inception after opening () stores and as we can say, the rest is history. But before it experienced this phenomenal growth, a rivalry brewed that almost threatened the expansion of Caktiong’s business. McDonald’s in the Philippines was not represented in our shore until George Yang persuaded the American fast-food chain in 1981 to bring the franchise amidst a burgeoning demand for American fast food, incidentally led by Jollibee during that period. After setting up Golden Arches Development Corporation as the master franchisee of future McDonald’s stores, Yang proceeded to opening his 1st store in (). Initially, this chain was slowly catching up to Jollibee, which felt threatened by its presence due to its global popularity and size. Jollibee’s market share was subsequently being captured by McDonald’s, which then took (%) of the whole. This trend continued until the national crises and coup d’état during the late 80’s prevented further expansion, due to the hesitance of McDonald’s international arm to hedge on the country. Once the commotion has settled, Jollibee’s capitalization soon outweighed the whole McDonald’s franchise in terms of sales and store count (Conde 2005). So how did they achieve

However, another paper (Cuervo-Cazurra 2007) highlights the struggles Jollibee must overcome to ensure viability due to a loss of advantage in a rival’s turf and the cost of doing business outside home territory, namely loss of advantage, creation of disadvantage, and the lack of a complementary resource (711). Moreover, Finkelstein added that consistency in the fast food business is a must even though one may be in a different state or a foreign country (96). In Jollibee’s case, its problems stem from location (finding prime space for lease) and talent (finding credible managers who can guide its international expansion; both strong points for Jollibee in the Philippines) (Bartlett & Oćonnell 5). This was the case when Jollibee tried to expand in Taiwan on a 50/50 joint venture with a Taiwanese last 1985. After declining sales and disappointing revenues, conflict arose over day-to-day management issues between the Jollibee operations staff assigned to maintain local oversight and the partner (4). To counteract such problems, Jollibee hired Noli Tingzon to outline its strategy, namely, raising the standard, supporting the settlers, and expanding the base (12-13). This necessitates adding these efforts on top of the problems already associated with expansion. However, this could provide a long-term effect since the strategy revolves around the populous OFW community. It is not a question of demand, but a question of putting up new stores. So despite its