For Manuel V. Pangilinan, one of the top business executives in the country, eradicating poverty should be Job No. 1 for every Filipino. But to be successful, more people should help not just in civic projects but also in government programs that invite partnerships with private businesses. READ FULL STORY

By Cecil Morella

MANILA – Armed with a fast-growing fleet of planes and enough junk food snacks to feed entire armies, Philippine tycoon Lance Gokongwei is striding out confidently in the world’s most populous region.

Best known as the boss of budget carrier Cebu Pacific, the 43-year-old also leads a vast conglomerate that is involved in an array of ventures, with one claiming the title of the biggest consumer food business in Southeast Asia.

Thrust by his rags-to-riches father to lead the family-owned businesses in 2002, the US-educated Gokongwei said the group had worked feverishly to diversify and become a big player across a range of markets throughout Asia.

“I think any family business has to adapt because things are so much more competitive now,” the reserved, soft-spoken father-of-two told AFP in a recent interview at his office in a Manila high-rise tower owned by the family.

“Our job, really, is to push our international business.”

The airline and its trans-Southeast Asian branded food manufacturing business, Universal Robina Corp., are the two biggest moneymakers of the listed family conglomerate JG Summit Inc., capitalized at about $3 billion.

But it also has interests in real estate and hotels, retailing, telecommunications, petrochemicals and banking in the Philippines.

On the food side, the company each year sells $1.15 billion worth of wafers, potato chips, tea, cereals and chocolates in Hong Kong, Indonesia, Malaysia, the Philippines, Singapore, Thailand, Vietnam and China.

The food business, which calls itself the Philippines’ first multinational, has struggled in China but succeeded elsewhere and has little debt, said April Tan, research chief with stock brokers Citisecurities Inc.

With nearly half of its profits coming from outside of the Philippines, the company’s efforts to broaden its base are paying handsome dividends, according to Tan.

“If you’re catering to a bigger market, the earnings potential is much higher,” Tan told AFP.

Cebu Pacific, the no-frills carrier with dancing flight attendants, has similarly started to spread its wings across Asia after success at home.

When Cebu Pacific began flying in 1996 with the motto, “It’s time everyone flies,” few Filipinos could afford to traverse the archipelago by air and hundreds were dying every year in alarmingly frequent ferry disasters.

It has since become the country’s biggest airline in terms of the number of domestic passengers — eclipsing national carrier Philippine Airlines.

“With Cebu Pacific, it’s quite clear that they’re capturing the bulk of the market and obviously, they are the fastest-growing carrier in the country,” Tan said.

The airline boasts a young fleet of 32 planes and serves 50 domestic and 23 regional routes. Profits are surging and it is set to bulk up with 24 new planes due for delivery over the next 14 months.

Gokongwei said the entry of other low-cost carriers in the Philippines since the Cebu Pacific success showed the huge potential pent-up demand in a country of 95 million people, 10 percent of whom work on short-term jobs abroad.

Gokongwei company shares surged last year ahead of the airline’s listing, turning the family into the country’s third richest and putting it on Forbes magazine’s billionaires’ list, its worth estimated at $1.5 billion.

A fitness nut who ran the New York Marathon last year, Gokongwei said that at times he and his father, John, a Chinese immigrant who remains the group’s largest shareholder, disagree on which countries or businesses to invest in.

In the end though, the old man, who made his name as a risk-taker, gets his way.

“I’m a working man. I’m working for him,” said the son, who went to business school at the University of Pennsylvania.

However the son proved his management mettle by reviving the young airline after one of its planes flew into a Philippine mountain killing all 104 people aboard in early 1998, according to Manila businessman Antonio Ramon Ongsiako.

“Lance is well regarded and has a reputation of being a better, more refined version of his father,” Ongsiako, a former director of the Financial Executives of the Philippines, told AFP.

“Lance will take JG Summit to a bigger and better future.” (Agence-France Presse)

Jollibee Foods Corp. (JFC), the country’s largest fast food chain, has taken over control of Mang Inasal, a highly successful Visayas-based restaurant chain specializing in grilled chicken, in a deal worth P3 billion.

In its disclosure to the Philippine Stock Exchange on Oct. 18, JFC said it has submitted an unsolicited offer to acquire 70 percent of Mang Inasal Philippines Inc. (MIPI), which was unconditionally and irrevocably accepted by its parent company, Injap Investments Inc. MIPI remains a significant minority holder with 30 percent equity.

Mang Inasal, a homegrown business, started as a single proprietorship in December 2003 by its founder, Edgar “Injap” Sia II, in Iloilo City, the first barbecue fast food chain anchored by its flagship chicken inasal product.

MIPI, which has grown its branches to 306 stores nationwide, is in a positive net cash position, racking up total revenues of P2.6 billion and system-wide sales of P3.8 billion. It is targeting 500 stores nationwide before 2012.

Observers say Jollibee’s buyout of controlling interest in Mang Inasal was meant to eliminate a fast-growing competition and maintain its market dominance over the local fast food industry.

The Jollibee Group already operates the most extensive fast food network in the Philippines with a total of 1,578 stores: Jollibee (703), Chowking (404), Greenwich (218), Red Ribbon (215), Delifrance (23) and Manong Pepe’s (15).

On Oct. 12,  Sia,  chairman and CEO of Mang Inasal Philippines, Inc., was presented the Small Business Entrepreneur award for 2010 by the Ernst & Young Entrepreneur of the Year (Philippines) for best demonstrating management excellence in a business with assets of less than P100 million.

In the following article, Entrepreneur of the Year Philippines 2010 chronicles how the young probinsiyano entrepreneur defied the odds and steered Mang Inasal to its phenomenal success.

Young probinsiyano entrepreneur shows the way

The Philippines is the 12th most populous country in the world with over 90 million mouths to feed. Without a doubt, getting into the food business remains a very viable opportunity for entrepreneurs. But with so many players, how does one stand out to be noticed? More importantly, how can another food business make it big time?

Edgar “Injap” J. Sia II answered these questions by conducting his research in a very methodical manner. He looked at the 16 different regions in the Philippines and recognized that each has a unique set of culinary traditions and eating habits. He then analyzed and identified what type of food would have the most potential and mass appeal. This was the ubiquitous barbecue (inasal in Ilonggo).

With much perseverance, innovative thinking and a deep understanding of business, Sia created Mang Inasal in Iloilo City in 2003. Today it has emerged as the country’s sixth largest fast food chain and its growth seems to be unstoppable.

That the boyish Sia would venture into business comes as no surprise. Born into a family of Chinese-Filipino entrepreneurs, he was exposed to business from a very young age.

He recounts how, at the age of 10, he would spend his after-school hours stacking merchandise or manning the counter in his parents’ grocery store in Roxas City. “While many of my friends were playing or riding their bikes, I would be moving inventory and counting soap,” he recalls.

The family store became the training ground that cultivated Mr. Sia’s drive for success. Learning from the example of his industrious parents, Sia developed what he refers to as an almost “sixth sense” for business. At 20, he was already running multiple businesses — a photo developing franchise, a 58-room three-star hotel and a laundry shop in Iloilo City.

Sia seized another opportunity that came knocking in December 2003 when he was offered a 250-square meter space behind Robinson’s Place Iloilo. The space, in an unused car park, was being offered at a very attractive price. Listening to his well-honed business instincts, he jumped at the chance to acquire it. In retrospect, Mr. Sia admits that he acted on a hunch.

“The price was so attractive that I couldn’t forego it, even if I had no business plan in mind. I bought the space not knowing what to do with it! You can say that the space came ahead of the concept.”

While mulling over ideas, Sia was sure of one thing — whatever he came up with had to have the potential to expand on a nationwide scale. After much consideration, he eventually decided to go for the time-tested appeal of the Ilonggo’s comfort food, chicken barbecue or inasal, served fast-food style. Mang Inasal fuses Filipino cuisine with the fast food dine-in concept.

Mang Inasal was Sia’s first venture into the food industry and the challenges he encountered were daunting. When he started, the concept of a fast food restaurant serving traditional Filipino dishes was a novelty and Sia knew he was up against the top players in the Philippine fast food industry. Without a real system in place during his first year of operation and no commissary to supply their raw materials, he had to learn the hard way.

Sia in fact had to do most of the work, from managing the business to preparing and serving the food to cleaning up afterwards. This complete lack of hesitation to do backbreaking work, however, enabled Sia to achieve in seven years what others have taken twice as long to achieve.

Barely a year after Mang Inasal opened, Sia was able to set up another branch, this time in his native Roxas City. Their second year of operation saw six more branch openings and, in their third year, over 20 more. This phenomenal growth brought a flood of franchise offers but Sia held back until 2005 when he was completely confident of the stability and brand recall of the business. Only after a year of sustaining market demand and developing his customer base was he convinced that Mang Inasal was en route to expansion.

When Sia finally opened Mang Inasal for franchising, he concentrated his efforts on his own backyard — Visayas and Mindanao — where inasal is most popular. Not long afterwards, potential franchises from Luzon showed much interest, paving the way for Mang Inasal to penetrate Metro Manila. Mang Inasal now counts 306 branches nationwide of which 28 are company-owned.

As Mang Inasal gained popularity, there was a need to maintain top quality. To safeguard consistency in all aspects of the business, such as product quality and cleanliness, Sia established several monitoring systems and procedures. A highly skilled research and development team was tasked to handle product development and guarantee a consistent inasal taste. To facilitate smooth transactions with their commissaries and ensure consistent supplies, Sia implemented an advanced online supply ordering system for his branches.

The 32-year-old Sia considers sheer hard work and innovation as the primary reasons of Mang Inasal’s success. He also cites the uniqueness that allowed him to beat the odds as a new player in the fast food industry.

He says, “Mang Inasal is a truly Filipino-style fast food chain. Our concept, ambiance and even the way our food is served on banana leaves is authentically Filipino.”

This, according to Sia, differentiates them from the other fast food giants in the country. In addition, Mang Inasal was one of the first quick-service restaurants to offer unlimited rice, which strongly appealed to diners.

Despite the success of Mang Inasal, Sia recognizes there’s still a lot that can be done to even make it bigger. He is constantly thinking up new ideas to maintain Mang Inasal’s competitive edge, such as their recently launched delivery service.

Variations in the breakfast menu are being developed and he is also looking at giving fast food dining a whole new feel with patented combo cups. The company is preparing to go public by the end of 2010 to solidify its stronghold in the Philippine fast food industry.

While he listens to his instinct, Sia is very calculated and strategic in his approach to business. He firmly believes in hard work and perseverance, and encourages aspiring entrepreneurs to do the same.

He also urges them to believe in their capacity to make their dreams come true, saying “Nothing is impossible with the right attitude. Do not be intimidated by problems. Instead, look at them as opportunities for growth. I was lucky to acquire the right entrepreneurial attitude as a young boy. You could say I developed the right asal (behavior) for inasal,” he quips.