Jollibee vs Lotteria

Fast food like burgers and fries are quick yet tasty to grab like McDonald's; the world's No. 1 famous fast-food that everyone knows. But are you familiar with other fast-food like Lotteria in Korea, Hokahoka Bento from Indonesia, and Jollibee from the Philippines? I think not. Moreover, I am going to only talk about the Philippines and Korea's fast-food. Growing up in both countries, which means I am familiar with them, so I want to share my experience.

Jollibee is a famous fast-food brand that originated in the Philippines, initially started as ice cream and hot dog shop. From the mid-1980s, seeking overseas expansion and opening a store in Taiwan in 1986, it has now expanded to the United States, Europe, China, and now it operates over 3,000 stores worldwide. This fast-food is treated as a high-end restaurant because the average wage in the Philippines is low, so it is more expensive than eating in a stand. Therefore, on special days like birthdays, quite a few families are eating out in Jollibee.

these are my favorites from Jollibee

1. Jollibee spaghetti (Filipino-style spaghetti)

This spaghetti is a completely different one from the Italian one. Unlike other spaghettis , this Jollibee spaghetti contains sugar (yes it's sweet, so I think it will be either you like it or hate it) And the sauce is made from banana instead of tomato. Back in the old days, there weren't many tomatoes in the Philippines. However, they could produce bananas because of their tropical weather and they mixed it with tomato to make the ketchup. They call this "Banana ketchup" which you can find in any local store in there. The spaghetti has also mixed with sausage and cheese on top. You can often find this during a birthday party or any special occasion, which is served and eaten by many people. + it's sweet so I like it!

2. Jollibee Chickenjoy (Highly recommended)

The Fried Chicken in Jollibee is served with rice and gravy. Some people enjoy it because of its perfect combination with its gravy. The reason why I like this chicken is because of its crispy skin and juicy tenders. There is also a spicy flavor with a cute flag pinned on its top!

3. Peach Mango Pie

(Honestly, I haven't tried this one, but I saw many people recommend this pie so I thought it would be better if I include this) If you like sweets, mangoes or peaches, then you should definitely try the Jollibee's Peach Mango Pie. It is crispy on the outside and sweet like honey on the inside. The best part is, it only costs 30 pesos ($0.599)! I think this goes well with the taste of children.

And these are my favorites in Lotteria

1. Tornado Chocolate Cookies Shake

My favorite ice cream is cookies and cream, so there's no doubt why I love this one. You can buy it at an affordable price of 1500 won($1.24), which I highly recommend for a quick go-to snack.

2. T-Rex Burger

Just like the name itself, this burger has a large chicken tender inside that looks like dinosaur feet! If you can't choose between chicken and burger, you might as well try this one.

However, Jollibee is widely-known worldwide, so what is the difference between these two?

Jollibee's initial menu, which started as a small ice cream shop in 1975, was nothing special. Hamburgers, simple noodles, rice, chicken, and ice cream that is enjoyed by locals were all there. It was a concept similar to Korea's Lotteria.

So how did Jollibee find its success?

Just as Lotteria fought a fierce market battle with McDonald's in the 1990s and 2000s, Jollibee had to cross the McDonald's wall to seize the market. Before the 90s, he used a strategy of choosing a store attached to McDonald's and opening a new store.

This strategy was later adopted by the Korean coffee franchise “Ediya,” which faced Starbucks, but after a thorough investigation, they were able to benefit from McDonald's and Starbucks, which carefully decided on their store location.

Of course, some believe that Jollibee's growth was fueled by the growing youth population, a strong domestic market, and marketing strategies that appealed to the Filipino emotions and nationalism. But that is not enough. In the Philippines, McDonald's has also grown steadily in the last 10 years, and that cannot be ignored when Jollibee was only raised into a global company.

Recently, there is an analysis that finds the secret of Jollibee's success in the global market itself. It is an effective use of the so-called “two-track” strategy. It is effective to establish a Jollibee store in overseas regions with a large population of Filipinos. In other regions, they target the global market by aggressively acquiring promising new businesses or local companies that are gaining popularity. This can be done as simple may it sounds, but can also be powerful when it's funded. Also, there is no need to focus on complicated and time-consuming localization or expensive marketing.

So what is the situation in the fast-food industry in Lotteria?

The prospect of Lotteria is not so bright. Lotteria recorded sales of 99.1 billion won last year. Operating profit was KRW 3.2 billion, but the net loss was KRW 31.2 billion with a loss of KRW 41.1 billion in non-operating income. The number of stores was 1338 as of the end of July this year, which is down from 1350 in 2017. So is McDonald's. McDonald's Korea has pulled out 20 stores this year, including its core business district. In addition to the core commercial areas of Seoul, Sinchon, Gwanhun, as well as Jeongdong, Seoul National University, Sadang, Yongin Dandae, Amsa Station, Aeogae, Cheonho Emart, and Busan Seomyeon.

Since several years ago, profitability has also plummeted. According to the Fair Trade Commission, McDonald's operating profit plunged from 11.7 billion won in 2013 to 2 billion won in 2015. Net profit also shifted to a loss of KRW 17.1 billion from KRW 33.8 billion in the same period. The operating margin has barely exceeded 2-4% over the past four years. McDonald's Korea does not disclose its results as a limited liability company, but the industry estimates that this year exchanges will decrease by 20 ~ 30% compared to the previous year.

Unlike the Philippines, the Korean fast-food domestic market has already reached its limit. McDonald's is a global company, so it may have less impact. For Lotteria, where most sales are generated from domestic demand, it's different. An official at Lotteria said, “I failed to read the trend because I focused on the policy to increase the number of affiliates.” In 2017, the so-called “hamburger disease” controversy may have been attributed to the sluggish industry, but it is argued that a health craze in Korea and the existing image of Lotteria did not appeal to the market trend. Lotteria has also made many attempts to advance overseas. However, it was not very successful.

A typical example is Lotteria's acquisition of the Japanese Burger King, which is surprisingly unknown. Burger King, a global fast-food company, passed the business to Lotteria in 2007 in the Japanese market. However, Japan's Lotteria also abandoned its business in three years and passed the baton to Korea's Lotteria (which is now Lotte GRS) in 2010. Lotte GRS acquired the Japanese Burger King at a symbolic price of 100 yen (currency exchange rate was 1,400 won at the time) under the condition that it took about 20 billion won of debt held by Burger King Japan holdings at the time. However, Lotte GRS could not revive the Japanese Burger King. Even after 7 years of effort, the company is losing 10 billion won every year, and the cumulative loss during the period reaches 1 billion won.

After all, I still prefer Jollibee over Mcdonald's. Lotteria feels like a parody franchise of Mcdonald's and Jollibee feels unique because of their Filipino styled dish (which is my favorite). Though trying Lotteria isn't bad as long as you only try the Tornado shake. If you are visiting Korea and planning on eating burgers, I wouldn't recommend you going to Lotteria, since there are many high-end burger restaurants that you can find which I assure you'll gonna love them!

Truly Tree