Doughnuts and more

For Anthony and Jennalyn Mendoza, bagging a CountryStyle franchise made a lot of sense. As a couple, they wanted to get into a business together. They also liked eating CountryStyle’s core product, doughnuts.

"The majority of our franchisees are walk-in or phone inquiries, whose sole reason for wanting to become a franchisee is they love the product so much," said Megalicious Foods Corp. marketing manager Genaline Austero. "We have more than 100 varieties of doughnuts, although we don’t make all of these varieties at the same time. We are best known for our square doughnuts, which we introduced into the local market. We are also the first to use chocolate yeast."

The Mendoza’s store in Cybermall, Libis, Quezon City, is the third within the 50-store chain to operate 24 hours. It is also the chain’s 49th store and the newest franchised outlet. The 50th store is a company-owned outlet operated inside the canteen of Ateneo de Manila University.

Business Models

Megalicious is the Philippine franchise holder of CountryStyle Bakery, Deli & Café, which started out in Toronto, Canada, in 1963. Today, CountryStyle operates more than 400 stores in Canada alone.

"When we started out in Alabang in 1996, we positioned ourselves principally as a not-too-sweet doughnuts company that just happened to serve good Canadian coffee on the side. Today, we serve a wide array of products, depending on the business model," said Austero.

A cart measuring three to five square meters, for example, carries only doughnuts and requires an investment of P200,000. A kiosk, which also sells sandwiches, needs an investment of P400,000. The full-line business model carries the complete line of bakery items, pasta, soups, and salads as well as coffee and juice. Total investment ranges from P500,000 to P1.8 million, depending on whether it is a take-out counter located in a food court of a mall or a dine-in store with tables and chairs.

"We are rather conservative in implementing our franchising package. We don’t set a quota of new stores that must be opened within a particular year. We would rather be slow but stick to our commitments with the mother franchiser in Canada to give only the highest levels of quality, service, cleanliness, and value. For example, none of our doughnuts are old stock. What is not sold during the day are either disposed of, given away, or brought home by the franchisee," said Austero.

Franchising

The company also looks at two crucial factors in a franchising offer. One, the proposed location must have a real market, not just one to be wooed. Two, the rent to be paid should not exceed 10% of the expected sales in the area to enable a would-be franchisee to earn.

Right now, the company is currently looking for area franchisees outside Metro Manila, who will commit to develop several outlets and to build a central commissary for the province. It is also looking for dealers or outright franchising among school canteen concessionaires.

"Our target is to be in the top 500 firms in the Philippines in 10 years and to have the competitive edge in the food industry by then," said Austero.

The Mendoza couple are buying into the dream. They are now looking for new sites for their second store. –RGdelaCruz