Topic > essay - 873

Jollibee was founded by Tony Tan Caktiong in 1975. At the time it was just an ice cream shop. A year later, Jollibee had evolved into a family business called Jollibee Foods Corporation after owning 5 Jollibee restaurant stores in Metro Manila. Jollibee's success in the Philippines has attracted the attention of foreign businessmen who believe it can succeed against McDonald's. The Tan family was motivated and seized the opportunity to come on board. They began to play as pawns in global chess and compete for global position in the fast food industry. Soon the company enters the international market and two main issues are raised: geographical location and partner trust. Australia represents another opportunity for Jollibee to venture into the fast food sector. Statistics have shown that Australian spending on fast food has increased by 23% over the past four years. According to the Commbank Signals study, the increase in fast food consumption is due to the 2009 financial crisis (Ting, 2013). There are different types of entry modes to use for Jollibee. Franchising is the most suitable way to enter the Australian market. Franchising helps create business opportunities for Australians who want to do business but don't know how to start a business. Franchising is the best option because Jollibee will guide them on how to set up their restaurant and provide training. Griffith University conducted a survey showed that 90% if franchisees had operational profitability (Frazer, Eeaven, & Bodey, 2012) and Australian would prefer to purchase a franchise license with the lower risk to them. Another reason for using franchising is that Jollibee had tried other types of entry modes such as joint ventures and partnerships and had failed in the past due to lack of trust and understanding of where it was located... middle of paper ... .daily operation and management by themselves as business owners in their city. The franchisee is a businessman and has the right to manage people in his own way and they only follow the guidelines of the Jollibee operation manual. However, Jollibee is able to monitor the company's performance and identify areas of poor performance. Jollibee may receive regular updates to ensure that the affiliate is doing things right and adhering to Jollibee's procedure. This could help Jollibee reduce potential failures as they work as an entire network. In conclusion, Tingzon needs to select the new franchisee with more caution and not repeat the mistake made by Jollibee in the early years. Franchising will reduce risks and costs for Jollibee, but it will also have to take care of the brand image in the franchised outlets. There is a great market opportunity to expand further outlets in Australia.