Max’s, Pancake House to track separate expansion programs

MANILA, Philippines - The Max’s Group of Companies and Pancake House Inc., which together make up the largest casual dining chain in the country, will continue their expansion program as separate entities, banking on several established restaurant brands.

Max’s will add as many as 15 restaurants locally as it charts the growth program of newly-acquired Pancake House, its top executive said yesterday.

“Both brands are positioned for growth. Right now, we are in the process of firming up our numbers in terms of the growth strategy,” Robert Trota, president of Max’s and Pancake House Group, said in a briefing.

“At this point in time, we will keep the two groups separate and run them as they are,” Trota said, quashing market speculation that Max’s will merge with listed entity Pancake House.

In December last year, Pancake House Holdings Inc. sold all its shares to Max’s for P2.98 billion. Max’s then conducted a tender offer, allowing it to secure 89 percent of Pancake House.

It was a strategic acquisition since Max’s had wanted the brands of Pancake House, Trota said.

“We would like to continue to be number one in the casual dining category,” Trota said.

The acquisition allowed Max’s to increase its brands to 14, adding the likes of Pancake House, Teriyaki Boy, Dencio’s, Yellow Cab and Kabisera to its fold. Prior to the deal, the Max’s Group carried Max’s restaurants, Max’s Corner Bakery, Krispy Kreme and Jamba Juice.

“Now that we have increased our brands, it makes us excited to grow on these,” Trota said. Max’s Group has 210 stores here and abroad while Pancake House has 300.

Trota said Max’s Group will continue its program of putting up 10 to 15 branches every year while it is still conducting a strategic planning session for Pancake House.

As of end-September, systemwide sales of Pancake House hit P4.2 billion while Max’s Group’s revenue was at P8.5 billion, which could grow 10 percent this year, Trota said.

Jim Fuentebella, branding director of Max’s Group, said the company’s expansion is also hinged on the creation of new shopping malls of big players such as SM, Ayala Land, Robinsons Land and Megaworld.

Trota said the company will ideally pursue its expansion program through a healthy mix of franchising and organic growth. Max’s restaurants require an investment of P10 to 18 million, followed by Pancake House at P8 to 10 million and Yellow Cab at P5 to 7 million.

To cater to overseas Filipinos, Max’s will put up six stores in the Middle East in the next two years, Trota said. It presently has 10 branches in North America and three in the Middle East.