Philippines’ Jollibee ends Dunkin’ coffee venture in China
Published on: Wednesday, November 09, 2022
By:
FMT, Nikkei
Jollibee had planned to open more than 1,400 outlets across China, including in Beijing, Hong Kong and Macao.
MANILA: Philippine fast-food group Jollibee Foods on Wednesday said it is ending its Dunkin’ coffee venture in China after struggling to expand the chain.
Jollibee said its partner Jasmine Asset Holdings and US-based Dunkin’ Donuts Franchising have terminated a franchise deal that began in 2015. They had planned to open more than 1,400 outlets over 20 years across China, including in Beijing, Hong Kong and Macao.
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Seven years later, the venture has so far opened only seven shops in Beijing, which will also be wound up.
Jollibee CEO Ernesto Tanmantiong told Nikkei Asia last month that the company was “reviewing” the Dunkin’ venture, which had faced “challenges”.
Richard Shin, Jollibee’s chief financial officer, said Dunkin’ was not a core business in China, a market that is more accustomed to tea than coffee.
“It’s probably the right decision for us to reallocate our resources,” Shin said last month.
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Along with the Philippines and North America, China is one of the three main markets in Jollibee’s ambitious bid to become one of the five largest quick-service restaurant groups in the world by market capitalisation. The Philippine company, which operates over a dozen brands in over 30 countries, placed 11th in a ranking led by McDonald’s, based on FactSet data in October.
This is not the first time that a Jollibee venture in China has failed. The company previously shut down hot pot and beef noodle chains.
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After the Dunkin’ closure, Jollibee said it will focus on building its bigger business in China, namely Yonghe King, a Taiwanese food-inspired restaurant known for its freshly prepared soy milk, and Hong Zhuang Yuan, which serves congee and other hot dishes. Yonghe King and Hong Zhuang Yuan have 418 and 55 branches, respectively.
Jollibee is also planning to open 100 Tim Ho Wan dim sum outlets in five years in China.
Despite abandoning the Dunkin’ franchise, Jollibee still has a sizable asset in the coffee business. The company has an 80% stake in Los Angeles-based Coffee Bean & Tea Leaf, which competes with Starbucks in the global coffee market.
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