Jollibee Case Study

1. BUS 475-01 | Team #2

3. Introduction:
● Jollibee Food Corporation
○ Publicly Traded since 1993
● Filipino Multinational Company
○ Pasig, Philippines
● Subsidiaries/Acquisitions
○ Coffee Bean, Red Ribbon, Chowking, etc.
● Successful American Integration
● Penetration of Other Countries/Regions

4. Our
Company

5. ● Jollibee Began As an Ice Cream Parlor in 1975
● Founded 1978 in Manila, Philippines
● The Bee Logo = Hard Work and Sweet Life
● Business Model: B2C
● Jollibee Is Largest Fast-Food Chain In The Philippines
● International Expansion
○ JFC Has 5,800 Stores Across the Globe
○ Operating in 34 Countries
Company
History

6. “To serve great tasting food, bringing the joy of eating to everyone.”
Mission
Vision
“To be one of the Top 5 Restaurant Companies in the World."
Goal
JFC wants to expand Jollibee by 300 locations across
North America by 2024

7. The Coffee Bean & Tea Leaf
2019
Panda Express
2018
Smashburger
2018
Dunkin Donuts
2016
Fun
Integrity
Spirit of Family
Customer Focus
Speed With Excellence
Humility To Listen and Learn
MA&D Company Values

8. Management
● Board of Directors
○ Chairman and Founder - Tony Tan Caktiong
● Leadership Team
○ Officers, Regional Business Heads
Organizational Leadership Skills
● Delivers Results
● Influences Others
● Builds Confidence

9. Brands

10. Context &
Situational
Analysis

11. PESTLE Analysis
Political Labor Cost Increase; U.K. Sugar/Salt Tax; Health Regulations
Economics Inflation; GDP adjustments; increase in price of foods (Chicken)
Social Diets (Plant-based); Shift towards nutrition/heath; Pandemic/Post
Technological International Restrictions, AI/Robots, Apps, Self Ordering Kiosks
Legal U.K. Food Restrictions; Safety Measures increased (U.S., China, etc)
Environmental Animal Welfare, Sustainable Food Packaging

12. Threat of Entry
Level: Moderate
● Low Switching Costs
● Variable Capital Cost
● High Variable Cost -
Branding
Buyer Power
Level: High
● Lower Switching Cost
● Large Competition
● Large # of Substitutions
Threat of Substitutes
Level: High
● Large # Substitutions
● Low Switching Costs
● Competitive
Industry Rivalry
Level: High
● Competitive
● Low Switching Costs
● Copy Infringements
Supplier Power
Level: Low
● Large # of Suppliers
● High Competition
● Lack of Vertical
Integration
Porter’s 5 Forces
+ Technology
Technology
Level: High
● Efficiency
● Apps
● Other Companies

13. S W O T
● Large Market
Presence
● Food Quality
● Product Variety
● Joint Ventures &
Procurements
● 24 hour Customer
Service
● Marketing
● Lack of
Delivery
● Lack of
Automation in
Kitchen
● R & D
● Acquisitions
● Pandemic -
increase in
cravings &
prepared meals
● Consumer
trends
● Food
Regulations
● Shortages
● Increase in
Wages
● Copy Cats

14. Value Chain,
Strategy, &
Innovation

15. Value Chain Analysis
Vertical vs Horizontal Integration
Retail
Companies that sell the
product to the final
customer
Final Product
Companies that create
products with its own brand
Suppliers
Companies that create basic
components
Raw Materials
Companies that handles &
create commodities
Company
New Product
Competitor 1
Similar or
Better Product
Market Player
Dominate Product
Competitor 2
Hot Selling
Product
Domestic Market
Horizontal Integration - Merger, Corporation, Procurement
Backwards
Vertical
Integration
Forward
Vertical
Integration

16. ● Typhoon weather
○ Agriculture Vulnerability in the PI
○ Product price increase
● JFC in 2009
● JFC sourced directly from smallholder farmers
● Invested into partnership building & training
○ organize farmers into functioning cooperatives
● Buying directly from the farmers
○ one area of country producing lower yields
○ JFC can buy from a less affected region
● Product quality
○ assured & prices are more stable
○ negotiation relationship is directly between JFC and the farmers.
● JFC in 2015, Jollibee
○ helped over 900 farming families in 27 cooperatives
○ increase income of 200-500%
○ A quarter of all vegetable produce sourced by JFC now purchased directly
from the farmer cooperatives.
Value Chain:
Vertical Integration

17. Business Strategy
● Differentiation in product with flavors
○ Special red sauce
● “Mcdonald’s of the Philippines”
○ Positioning strategy in high traffic areas for
families
● Psychological Pricing
● General strategy in the U.S. is
○ Open in areas with denser Filipino-
American populations
○ Give them a “familiar feeling of home”
■ “Nostalgic filipino taste”

18. Chickenjoy Fried Chicken

19. Innovation/Industry Life Cycle Position
Revenue By Geographical Segment - in billion Philippine pesos
Jollibee is targeting a 30-30-30 division is sales between the Philippines, the United States and China, suggesting it has
big growth and acquisition plans in the world’s top two economies, beyond the 5,800 outlets of its 16 various chains

20. Mergers,
Acquisitions &
Deals
+
International
Strategy

21. Locations:

22. 1994
$7.3 million
USD
80% of shares
2000
$16 million
USD
2005
$34.2 million
USD
2010
$68.8 million
USD
70% of shares
2012
$69 million
USD
54% of shares
2021
50/50
Joint-Venture
2018
50/50
Joint-Venture
In the Philippines…

23. 2004
$22.5 million
USD
2006
70% of shares
2007
$50.5 million
USD
2010
$4.5 million
USD
55% of shares
2016
50/50
Joint-Venture
2018
$34.2 million
USD
In Mainland China & Taiwan…

24. 2015
$335 million
USD
40% of
shares
In the United States…
2018
$12.4 million
USD
47% of
shares
2019
$350 million
USD

25. International Strategy
● Jollibee has a strong hold in several markets around the world, including the US, Canada, the
UK, Saudi Arabia, and Vietnam.
● They have a 3 part internationalization strategy
○ Become popular in the Philippines
○ Become the largest fast food restaurant in Asia
○ Strive to become one of the top 5 restaurant companies in the world
● Efforts integrated with a 2 plan expansion strategy:
○ Brand acquisition
○ Brand expansion
● Loyal Filipino customers who live overseas help their success in international markets

26. Variations of Products and Services
● The core product remains the same across
markets
○ Offer region-specific additions to its
menu to better cater to local tastes, such
as the Saigon Chili Chicken offering in
Vietnam, and Chicken Burgers in the US.
○ In addition, portions change depending
on the market
○ The Jollibee stores in the US have a lot of
small $1 value meals like sliders in order
to compete with other fast food
restaurants.
● The services provided by the company include
Jollibee express delivery service, Jollibee drive
thru, Jollibee kids party and open 24 hours
Hong Kong Breakfast Philippines Breakfast

27. Organizational Design,
Corporate Governance,
& Black Swan Events

28. Organizational Structure
● Jollibee has a flat organizational structure
○ Helps the company make decisions effectively and gives more trust to its employees

29. Power Distance
Low
● Low power distance
● Flat organizational structure
● Balance between
individualism and collectivism
● Promotes optimal
performance
Individualism vs Collectivism
Organizational
Culture
Hofstede Model
of
Cultural Dimensions
Masculinity vs Femininity
● Low masculinity score
● Job responsibilities in the
organization overlap
frequently between men and
women
Uncertainty Avoidance
Long vs Short Term Orientation
● Long term orientation in strategy
focus and development
● Short term orientation with
execution
Indulgence vs Restraint
● High indulgence score
● Culture focused on people’s
gratification and needs
● Low uncertainty avoidance
● Relaxed environment

30. Board of Directors
Tony Tan Caktiong
(Chairman)
Ernesto Tanmantiong William Tan Untiong Don Alexander C. Lim
Ang Cho Sit
Antonio Chua Poe Eng
Ret. Chief Justice Artemio
Panganiban
Cesar V. Purisima Ee Rong Chong Kevin Goh

31. Corporate Officers
Ernesto Tanmantiong Joseph C. Tanbuntiong William Tan Untiong Ysmael V. Baysa
President & Chief Executive Officer Treasurer Corporate Secretary Chief Financial Officer
Chief Marketing Officer Chief Human Resources Officer
Daniel Rafael Ramon Z. Gomez IIII Arsenio M. Sabado

32. Jollibee & COVID-19
● Aimed to expand stores during pandemic through
expansion strategy utilizing low-cost properties
● Tried to open cloud kitchens and emphasize delivery
options to move away from dine-in options
○ Partnership with DoorDash
● Net loss of P11.51 billion ($217.7 million) in 2020
○ Deemed one of biggest losers in pandemic
○ Saved by aggressive expansions in North America
● Closed 255 company-owned stores and changed 95 to
franchised outlets to minimize losses

33. Repositioning
● Skyrocketed in 2021 to a profit of P6.3 billion ($123
million), surpassing Bloomberg Market Consensus
○ Attributed to success of fourth quarter
○ Opened 398 new locations in 2021
● Plans to open 500 new stores in 2022 attributing P17.8
billion ($339.3 million) to capital expenditures
“We look forward to continuing strong recovery of the business in 2022
particularly if the restrictions in the Philippines are fully lifted”

34. Financial
Analysis

35. Financial
Overview

36. Segment Information

37. Net Income, Gross Profit, & Free Cash Flows
Jollibee Net Income
2018 7,411.70
2019 7,368.10
2020 (10,307.40)
2021 5,586.20
Jollibee Gross Profits
2018 28,742.20
2019 29,368.30
2020 13,586.70
2021 26,078.90
Jollibee Free Cash Flows
2018 3,275.90
2019 8,682.30
2020 (7,803.60)
2021 9,813.40

38. EBITDA and Total Debt
Jollibee Total Debt
2018 66,895.10
2019 92,083.40
2020 102,846.40
2021 96,480.00
Jollibee EBITDA
2018 20,782.10
2019 20,066.10
2020 4,679.40
2021 19,426.60

39. Competitors
Yum Brands
● Pizza Hut, KFC, Taco Bell,
The Habit
Restaurant Brands International
● Burger King, Tim Hortons,
Popeyes, Firehouse subs

40. Jollibee Revenue & Comparables
Jollibee Yum Restaurant Brands
2019 179,626,188 5,597,000,000 5,603,000,000
2020 129,313,002 5,652,000,000 4,968,000,000
2021 153,575,590 6,584,000,000 5,739,000,000

41. Total Sales & Sales Growth

42. Key Financial Ratios
Jollibee Yum
Restaurant
Brands
2019 7.48 64.9 9.19
2020 -6.21 39.54 6.92
2021 5.4 55.59 9.51
Jollibee Yum Restaurant Brands
2019 3.57 72.63 9.08
2020 -7.58 32.26 7.53
2021 3.34 38.18 9.5
Jollibee Yum
Restaurant
Brands
2019 4.07 23.12 11.48
2020 -8.9 15.99 9.78
2021 3.89 23.92 14.6

43. Key Financial Ratios
Jollibee Yum
Restaurant
Brands
2019 4.32 27.65 3.03
2020 -5.78 16.31 2.15
2021 2.84 26.65 3.64
JolliBee Yum
Restaurant
Brands
2019 0.68 0.99 1.29
2020 1.36 1.01 1.41
2021 1.43 0.97 0.97

44. Margin Ratios
Jollibee Yum Restaurant Brands
2019 16.35 77.93 58
2020 10.51 73.35 56.96
2021 16.98 73.8 58.55
Jollibee Yum Restaurant Brands
2019 3.61 34.48 35.62
2020 -9.91 26.59 29.41
2021 4.09 32.49 32.81

45. Conclusion
● Continuing their International Expansion
● Great stance with branding
● Keep an eye on customer trends, regulations, & other giants
(e.g. McDonalds)
● Keep creating loyal customers during expansion
● Retain success through M&A and their loyal corporate board
● Vertically integrated with their suppliers
● Targeting families in filipino dense areas, nostalgic base,
international growth phase
● Steady recovery from Covid-19, continue to improve sales,
revenue, and margins

46. Thank You!

47. Sources:
https://www.sensu.co.uk/the-sugar-tax/
https://www.swotandpestle.com/jollibee-foods/
https://casemire.com/porters-analysis/jollibee-foods-corporation.php
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https://www.crunchbase.com/organization/jollibee-food-corporation/technology
https://pubmed.ncbi.nlm.nih.gov/33362340/
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