A Lasting Heritage

In the increasingly competitive foodservice sector, what is the key to brand longevity and success? While some may credit it to the biggest sales or market share, the brand names that resonate with the dining public are those that have put emphasis on strong and loyal relationships with their market, resulting in a stronger business, and growth potential with tangible results.

Max’s Group Inc. (Max’s Group)perfectly embodies this recipe for success, blending flavorful history and tradition with homegrown classics and global loved brands. F&B World was given an inside track on what has made this leading casual dining restaurant group in the country a food force to reckon with.

BIGGER STAKES

At the close of 2013, the F&B industry reverberated with the news that Max’s Group of Companies, renowned for its chain of fried chicken restaurants, had acquired Pancake House Inc. (PHI). The move increased to 14 the number of brands now under its management. This included the existing Max’s brands such as Max’s Restaurant, Max’s Corner Bakery, Krispy Kreme, and Jamba Juice together with the newly acquired brands from PHI consisting of Pancake House, Dencio’s, Kabisera ng Dencio’s, Teriyaki Boy, Sizzlin’ Steak, Le Coeur de France, The Chicken Rice Shop, Singkit, Maple, and Yellow Cab.

“Both companies share a long history of brand recognition and innovation, customer loyalty, and proven track record for expansion,” explained Max’s Group President and CEO Robert Trota. This strategic acquisition established the company's position as the country's leading casual dining restaurant group.

“With this integration, two alltime Filipino iconic restaurant groups and their total 14 brands are combined under one entity.”

RISING TO THE CHALLENGE

Max’s Restaurant, the company’s flagship heritage brand established in 1945, gained fame for its “sarap-to-the-bones” fried chicken. What started out as a café that catered to American soldiers stationed in Manila has now grown to over 150 stores, and is gearing up for its 70th year by 2015.

The company has also undergone a number of transitions since it began. It has evolved from a family-run business, to a professionalized Max's Group of Companies, and most recently as the publicly listed Max's Group Inc. The third generation of Maximo Gimenez’s family is still involved with the current business, but unlike other companies that see it as a detriment to their operations, their involvement actually works to the company’s advantage.

“We were born into this heritage, and we see it as our responsibility to honor that tradition,” statedCristina Garcia, Max’s GroupDirectorandTreasurer.The values that started with Gimenez have been carried through the generations and provide the fire and passion that fuel their business. She reveals outsiders may not be aware that there are actually four branches of the Gimenez-Trota family involved in the business—a formula that has resulted in an enviable work atmosphere at their head office and other areas.

The benefits of the familial training have prepared them to face the numerous challenges ahead and also allowed them to forge new grounds in the evolving food business. One of these transitions involved professionalizing their systems and departing from the traditional mindset and setup of family-run organizations. Their efforts paid off as the globally renowned U.S. brandKrispy Kremeawarded the master franchise for the Philippines to the company in 2006, after lengthy negotiations and seeing firsthand what they were capable of achieving. It was an impressive feat that created positive buzz for quite some time.

TRADITION AND GROWTH

The cult doughnut brand found its perfect partner in Max’s Group that continues until today, with its current store count of 52 branches. Max’s Group has continued with its healthy expansion, the latest of which has resulted in their present roster of 14 brands.

This growth has also required a strong and reliable business partner, who could provide the necessary support to improve operations and address the demands of their increasingly diverse customer base. One such partner who has been able to match the company’s needs is San Miguel PureFoods – Great Food Solutions. GFS' wide product portfolio and nationwide coverage for timely deliveries have been important factors for sustaining the company's growth.

How do they choose which brands to carry though? Undoubtedly, brand heritage and quality would be the main factors. “As our corporate mission states, we build loved brands,” emphasized Max’s GroupDirectorandVice President for Marketing Jim Fuentebella. That vision is echoed strongly in all of the brands in their current portfolio and in future brands that they would carry.

Following the acquisition of PHI, the opportunity to streamline operations for more efficiency was greater. "The integration leveraged the operational synergies of both groups, creating a bigger, more integrated, and efficient organization. With more brands in our portfolio, we have greater flexibility to satisfy diverse customer preferences," Trota affirmed. He also emphasized that their current roles involve strengthening their winning brands, revitalizing others, and retraining staff to improve service levels. However, Garcia noted that while there are key areas where streamlining and synergy are possible, each brand is distinct and unique, with their own store setups, and brand identity.

THE CORE TRUTH

Max’s Group is in the midst of refreshing their winning brands. They revealed that each brand—from Pancake House, Teriyaki Boy, and Dencio’s— had a unique heritage and authenticity that made them successful. It was this value for authenticity that had them seek out and consult each brand’s original owners and founders, from Dencio’sDennis Nakpilto Teriyaki Boy’sBryan Tiu. The purpose was to go back to the brand’s roots and rediscover the core values that they wanted to offer to their diners.

“It is getting back to the core of the brand and making sure that core comes out,” Fuentebella clarified. “It is what gave life to the brand in the first place.” For Pancake House, the archetype of the new store and logo was recently unveiled in Lipa, Batangas. The warm and cozy interiors are reminiscent of a shack, an inviting ambiance for its target market. The new logo still carries the trademark orange, but with a new glow accompanying it. Teriyaki Boy and Dencio’s will follow suit, each one refreshing the brand’s look and strengthening its positioning without veering away from the core dining experience.

REBUILDING THE HOUSE THAT FRIED CHICKEN BUILT

It is not a surprise that Max’s Group showcases their expertise in revitalizing brands, recalling a similar refresh for Max’s in 2009. “We needed to refresh the brand image of Max's, not just with our commercials and print campaigns but also with tangible aspects of the brand like the architecture. We had to make it more relevant and contemporary but not trendy. We re-evaluated our use-ofspace and decided on ways to be more efficient, both dining side and kitchen.”

Rebuilding the house that fried chicken built required a partner that could best reflect the spirit of Max’s. Budji Layug+Royal Pineda Design Architects spearheaded the transformation, which evoked warmth and nostalgia of the past but enabled the next generation to grasp that same nostalgia without any barriers. “Since we are a Filipino brand, it was only natural for us to choose a local architectural and design firm that also excelled in their field. They could stamp an identity that was both contemporary Filipino and Max's,” Fuentebella ended.

THE CHALLENGE OF NEW MARKET

For an almost 70-year-old brand, how does Max’s Group make it relevant for the younger market? Garcia notes that their team includes millennials in the work force, who contribute their own insights and ideas for reaching out to the next generation. “We are able to cater to the different markets through the diversity of our brands,” she noted.

Promotions and marketing campaigns are also key, adapting traditional marketing to reach out to both its loyal customers and engaging the new market segment. Their wildly successfulChicken- All-You-Canpromo was created to acknowledge their loyal patrons for its 65th anniversary. The result was an unqualified success in expanding their market base with new customers who are still awaiting its next launch. Its more recent campaign,Puso to the Max,sought to ignite the spirit of nationalism and solidarity for the Gilas Pilipinas team’s stint in the FIBA World Cup last August. It was another display of the passionate spirit that runs within the company’s walls, and guides management’s decisions towards a stronger and brighter future.

PAVING THE WAY

A year after Max’s Group Inc. made its strategic acquisition, the management team has already prepared for the next phase. This includes an aggressive expansion plan—68 new stores in the Philippines and 12 overseas—under its different brands.

Max’s Group Inc. will continue to be at the forefront of innovations, with its continuous growth spurred by the passion to reinvent itself but balanced by a sense of tradition. The Philippines and the international market can expect more from this group that aims to be the leading Filipino company with the most loved brands by 2025. A daunting feat for others, but certainly within their grasp if they continue to pursue it with the same decisive and clear vision that has guided them all these years.