FRIDAY, March 29, 2024
nationthailand

Max’s Group budgets for expansion inside, outside RP

Max’s Group budgets for expansion inside, outside RP

MAX’S GROUP INC (MGI), a major Philippine casual dining chain operator, is upbeat on growth from the roll-out of more stores at home and abroad alongside rising interest in franchising and the “phenomenal” expansion of its food-delivery business.

This year, MGI has earmarked 800 million pesos (Bt556 million) to fund its store pipeline and commissary upgrades as well as boost warehousing and distribution facilities and other support infrastructure, MGI chairwoman Sharon Fuentebella said in a written report to stockholders. 
The capital spending budget this year is higher than the 700-million-peso outlay in 2016.
MGI believes it is on track with its five-year growth plan to expand its store network to 1,000 by 2020, of which 200 will be in overseas locations. 
“Definitely, I think we will get to that point, and we have a lot of interest in our franchisees at the moment,” Robert Trota, MGI president and chief executive officer, told reporters after the company’s stockholders’ meeting yesterday. The group ended last year with 623 stores across 14 different brands under its restaurant portfolio.
Trota said cross-franchising – referring to old franchisees such as of flagship Max’s getting franchises of other brands within the group like Yellow Cab, Pancake House, Krispy Kreme and Teriyaki Boy – was accelerating the growth of MGI’s business, as this was allowing new stores to be put up even within the same territory.
Last year, MGI’s revenues from franchise, royalty and continuing licence fees surged by 54 per cent to 766.7 million pesos. Overall restaurant sales were up by 10 per cent last year to 9.4 billion pesos, while system-wide sales increased by 12 per cent to 15.3 billion pesos. All these contributed to 12-per-cent growth in net profit last year to 561.7 million pesos.
“The results [in 2016] underpin our bold transition from a period of integration and turnaround to an active phase of growth,” Trota said.
MGI expects to continue growing its food-delivery business – seen as an attractive proposition especially in urban centres where consumers are becoming more affluent while traffic gridlock making food delivery an alternative to dining out.
This year, Trota said, the delivery business was likely to grow by 20-30 per cent. Last year, MGI’s delivery sales grew by 24 per cent to 1.08 billion pesos, accounting for 9 per cent of total revenues. “It’s a phenomenal phase,” he said. MGI has set up a call-centre network with 150 agents to facilitate transactions as well as a multi-brand logistics system.
 

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