Filipino restaurant operator Jollibee Foods is set to open 171 stores globally and renovate 96 outlets this year, aiming to capture prime locations made available in a weak economic climate brought on by the coronavirus pandemic.
While that number of planned new stores is less than it predicted prior to the advent of Covid-19, the company still sees an opportunity to expand despite an extremely challenging start to the year globally.
The firm will also spend US$137.9 million on a restructure of its international business, which will include attention to non-performing stores, store network, supply chain facilities, and management and support group structure.
Jollibee Foods will devote some resources to the establishment of new delivery and take-out services – including unmarked delivery outlets without dine-in facilities – in anticipation of a slow return to business-as-usual following the resolution of the pandemic.
“2020 is an extremely challenging year for JFC as for most other businesses, but out of this transformation, we aim to emerge in 2021 as an even stronger business and organisation,” said Jollibee chairman Tony Tan Caktiong.
CFO Ysmael Baysa said the company expects its profit for 2020 will “not be good at all due to the overall economic environment. But like Caktiong, he put a positive spin on the crisis: “We are taking this opportunity to implement truly major changes in 2020 so that JFC will start 2021 in a much stronger position in terms of business model, operating efficiency, profitability and organisation strength.
“We will then resume strong and consistent profitable growth for the years ahead.”
In January, Jollibee Foods reported a 14.4-per-cent drop in earnings after operating income fell by 25.1 per cent.
However a strong fourth quarter prevented a worse annual result, with operating income up 11.6 per cent on a 23.2-per-cent boost on systemwide sales.
“Practically all brands in the Philippines improved their same-store sales growth quarter on quarter, led by Jollibee, Red Ribbon, Greenwich and Burger King,” said a spokesperson then.
Besides regional expansion across Vietnam, China and other Asian markets, the company is trying to restructure the troubled Coffee Bean business it bought last year and Smashburger, a year earlier. It is also looking to expand the Tim Ho Wan business in China and wants to open new restaurants under various banners in North America.