I guess it's time to talk about some of my all-time favorite fast-food outlets, Jollibee. I remembered writing about how Jollibee is proof that the Philippines is more than ready for an inflow of foreign direct investments (FDI) (read here). I was able to hear the news a few days ago. However, I decided to just write a new blog entry now after I had my thoughts together.
Here are some details from The Philippine Star to which one can read the following:
MANILA, Philippines — After four rounds of competing in four categories that included 16 fried chicken brands, Jollibee's Chickenjoy managed to win the hearts of the staff of a popular American food website as the "Best Fast-Food Fried Chicken" in the United States.
Admittedly a subjective taste test that had "no criteria" of judging other than to "follow their hearts," the staff of the American food website Eater adjudged the Chickenjoy as the best among all the different types of fried chickens they had tasted.
The final round saw a Philippines vs. South Korea match-up in a round of 16 that quickly progressed into the knockout stages, leading to the last two "dark horses."
Interestingly, the competition saw the two non-American finalists being pitted with classic American brands that have also set up shops in the Philippines such as McDonald's, KFC, Popeyes, Burger King, Wendy's, Wingstop, Shake Shack and Panda Express.
The categories were Bones, No Bones, Sandwiched and Sauced. The challenge strictly observed no repetition of brands in each category. The Chickenjoy was categorized in the Bones category, while Bonchon was lumped into the Sauced category.
Jollibee has had a long history of facing foreign competition. Its best-known competition back then was McDonald's though there were also KFC, Burger King, and Wendy's as other competitors. Some person I ran across on Facebook said Jollibee grew because of protectionism. However, that person was proven wrong with the news of Jollibee's expansion and its history.
CNBC tells us the story of how the two Tan brothers created their Jollibee empire from scratch:
Indeed, friends told the pair as much, and advised them to retreat from the challenge, Tanmantiong revealed in a recent episode of CNBC’s “Managing Asia.”
“When we learned that McDonald’s was coming into the country, friends were telling us to shy away from the competition — do (like) other businesses and to not try confronting the global giant,” Tanmantiong, Jollibee’s president and CEO, told CNBC’s Christine Tan.
But Tan Caktiong refused to hear it, Tanmantiong explained. Instead, the then-28-year-old founder called the business together to form a plan of attack.
“What we did was to have a strategic planning internally,” said Tanmantiong.
“We did a SWOT analysis on our strengths, our weaknesses and what the gaps were,” he continued, referring to a common analysis technique which aims to assess a business’ strengths, weaknesses, opportunities and threats.
While McDonald’s benefited from economies of scale and decades’ more experience, Tanmantiong said they identified one major area in which the U.S. giant could not compete: Taste. Filipinos tend to favor sweeter and spicier flavors, he said, and it would be difficult for McDonald’s to adapt to that without hurting the iconic American taste for which they had become famed.
This reminds me of one of the lessons of the late John L. Gokongwei Jr. One of his recollections is with his maternal grandfather. Gokongwei Jr. feared the buildings. However, his maternal grandfather told them that they were once little. Jollibee just started out as an ice cream parlor before it expanded to meet the giant, McDonald's. Again, even McDonald's was just a small company before it expanded. Some time ago this year, Jollibee opened its 150th store in Communist Vietnam. Jollibee is now a worldwide company.
This always reminds me of the excuses about why the Philippines should remain protectionist. Excuses like those are given by "think tanks" like Anakbayan, Bayan Muna, IBON Foundation, Kabataan Partylist, and League of Filipino Students. One of the most infamous statements that I heard was, Why will you let them invest here? Only they will get rich!" I decided to write a rebuttal against that idea (read here). The idea that FDIs are "foreign invaders" is dumbfounding (read here). Neri Colmenares and Teodoro Casino of Bayan Muna even stress it that businesses will be crushed. Some people believe that the Overseas Filipino Program (OFW) is a form of "conquest) which is but another blatant lie (read here). Some even believe that FDIs won't provide jobs for locals (a lie, read rebuttal here), Worse, some people can't even tell the difference between FDI and foreign debt (read here).
The Tan brothers stressed out about having healthy competition. They faced against McDonald's then decided they'd be different. After so long, Jollibee ended up becoming an international product. From what I heard, Jollibee adjusts to where they invest. McDonald's pretty much did that. I remembered eating a different type of McDonald's when I went to China for vacation last 2007. I remembered eating a different type of McDonald's in Singapore last 1998. I think Jollibee has been doing the same to survive the international market. FDIs such as Wendy's and many more became Jollibee's competitors. Jollibee learned, Jollibee conquered, and how Jollibee is conquering taste buds as much as its competitors.
Singaporean-Indian former UN diplomat, Kishore Mahbubani, stressed how FDI truly works. Mahbubani, the founder of the Lee Kuan Yew School of Public Policy at the National University of Singapore (NUS) said they'd be different. Mahbubani's thoughts were very from another former UN diplomat grandpa, Hilario Davide Jr. (read here). Davide Jr. said that FDIs will turn the Philippines into a colony of investors. However, Mahbubani decided to say his famous statement that FDIs will provide jobs, capital, and labor, and teach new skills. Singapore is a testament to that. Singapore was once a third-world country. The late Lee Kuan Yew's excellent parliamentary leadership and economic programs brought Singapore from the slumps into the first world.
This is why Jollibee's stocks are of good value. The Philippine Stock Exchange index (PSEi) tends to list Jollibee among the Top 30 players. Any index fund or equity fund linked to the PSEi will put Jollibee into the funds. The AXA Chinese Tycoon Fund also includes Jollibee among its list of blue-chipped stocks. If Jollibee can do it then I don't see any reason why Filipino businesses will all collapse. Yes, there will be Filipino businesses that will collapse but only those that refuse to evolve. Those that will evolve, like Jollibee, will be the ones that will survive with more FDI flowing into the country.
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https://www.philstar.com/lifestyle/food-and-leisure/2022/08/16/2203057/supremely-moist-jollibees-chickenjoy-reigns-best-fast-food-fried-chicken-us
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