Global Report

Philippines’ largest burger chain looks to expand into Canada

Following Filipino populations abroad

Jollibee mascot

Jollibee’s jolly bee mascot at one of the chain’s Philippine locations (Joshua Bousel/Flickr/Creative Commons)

When its first location opens here next year, Canadians will finally be able to enjoy the distinctive pineapple-topped Aloha burger that has helped make Jollibee the Philippines’ largest fast-food chain. But the restaurant took its time expanding globally, having opened in the U.S. 15 years before considering coming north of the border.

Founded in 1975 as a single ice cream parlour just outside downtown Manila, Jollibee is today the flagship brand of a family-run empire, spanning 2,700 stores and nine brands around the world.

Jose Miñana, who heads U.S. operations for the company, says Jollibee initially limited its expansion to just those areas with large Filipino populations. But the company later decided to aggressively pursue “mainstream” clientele, opening branches in further-flung locations and tweaking recipes to cater to North American tastes.

The company is wildly successful in the Philippines, where there are now two Jollibees for every McDonald’s. But in the U.S., where Jollibee was a virtual unknown, the company struggled after opening its first location in 1998.

“That’s when we realized and learned our lesson that, hold on, we’re a totally unknown brand here, no matter how good we are back home,” Miñana says.

So over the past few years, the company has pulled back: reverting to original recipes, closing underperforming stores and retrenching in areas with large Filipino communities. Last fall, the company announced it would open its first Canadian store in Toronto in 2015.

“We should have entered Canada way before, but we had to try and find our way in getting our brand well in the U.S.”

Lovell Sarreal, an analyst for Maybank covering Jollibee in the Philippines, says the company’s return to conservative but steady expansion is good for investors. U.S. operations are now profitable, accounting for about 5% of Jollibee’s total sales.

“Eventually growth in the Philippines will slow down, and to sustain the high growth of the company, you have to expand overseas,” he says.

After opening its doors in Toronto, Jollibee hopes to expand to other cities in Canada—like Vancouver and Winnipeg—with high Filipino populations.

Unlike in the Philippines, where Jollibee is a franchise, all of its North American stores are company-owned. Although franchises would allow Jollibee to expand faster, Miñana says that’s not the point: “We want to enter there with the Jollibee brand the way we want it done—really right.”