Business

Saturday August 29, 2009

Franchisees undeterred by downturn


THE recent economic downturn saw a drop in customers, says Peter Chiu from Sarawak, the first McDonald’s franchisee in Malaysia.

However, his belief in the McDonald’s proven system has held him steadfast.

Like all eight franchisees, McDonald’s meets up with them at least six times a year and shares its business strategies.

Henry Tan, a recent franchisee from Batu Pahat, says that the company has had proven success since its beginnings.

“The many store owners the world over can’t be wrong. What’s important is to believe in the system and work passionately,” he says.

“Amid the recent downturn when prices shot up, we met with the franchisees to see what could be done. In a discussion with our company, the franchisees and the suppliers, we introduced the new McValue menu”.

“It was a proven success in South Korea and by adopting the idea, it has worked well here,” says Sarah Casanova, managing director of McDonald’s Malaysia. McDonald’s Malaysia hopes to see its franchisees outlet base grow from the present 17 to an additional 33 by 2012.

“What has really changed for me is the cost averaging system. Even though I own two restaurants in Sarawak, the cost is averaged out. I am not treated differently from the stores in the peninsular,” says Chiu.

Another franchisee, Azmi Jusoh from Kuala Terengganu, says his store has given steady jobs to the youths in his state.

Both he and franchisee Muhammad Aiman Ezanee of Kota Baru see a change in eating habits in the east coast.

People are more receptive to the food even though the Malay culture is strong there. “We do see a great opportunity for expansion and of reaching out to the community,” says Azmi.

The costs of securing a McDonald’s franchise vary from RM1.5mil to RM3.5mil depending on the type of restaurant. As a general guide, no less than 30% of the cost must be funded from non-borrowed personal resources.

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