Term Paper on Business Ethics of Jollibee Food Corporation

Submitted by:

Vlademer S. Maglana
 Table of Contents

Introduction 1

Objectives of the Study 2

Brief History of Jollibee Foods Corporation 2

Business Ethics 3

Principles 5

Challenges encountered 7

Strengths 9

Weakness 10

Opportunities 13

Implications 14

Conclusion 15

References 16
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Chapter I

INTRODUCTION

Jollibee is most popular for Chickenjoy, its unique broiled chicken that is gently hand-

breaded to be crispylicious outwardly, with a mystery marinade making it juicylicious

within. Jollibee Foods Corporation's (JFC) center business is the turn of events, activity

and diversifying of its speedy assistance café brands. It offers a wide assortment of

reasonable and flavorful dishes and extraordinary tasting food arranged to fulfill clients

of any age and from varying backgrounds (Garcia, 2022). The very first Jollibee branch

was in Cubao, Quezon City which opened in 1975 as a Magnolia Ice cream parlor.

Whenever Jollibee was consolidated in 1978, there were 7 branches in Metro Manila.

The main diversified outlet of Jollibee opened in Santa Cruz, Manila in 1979.Jollibee

experienced quick development. It had the option to endure the passage of McDonald's

in the Philippines in 1981 by zeroing in on the particular preferences of the Filipino

market, which varied from the American inexpensive food organization (Rios, 2016).

Jollibee has the most uncommon cheap food in the country. The ridiculously well known

Filipino chain has extended to in excess of 800 eateries across 10 nations

(remembering 29 for the US) by blending Filipino solaces, American cheap food

patterns, and a generous portion of animation showcasing.

Additionally, there various foundation has been made in Valencia City Bukidnon through

times. Not all are honored and fortunate to endure and work in longer times since

Valencia City is only a little city. This research project will zero in on the business

morals of Jollibee and what they meant for the local area.
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Objectives of the Study

This study aims to:

1. Identify the Business Ethics of Jollibee Foods Corporation.

2. Determine the challenges encountered by Jollibee Foods Corporation

3. Evaluate its implications in the community of Valencia City, Bukidnon.

Brief History of Jollibee Foods Corporation

Tony Tan Cacktiong and his family opened a Magnolia Ice Cream parlor from the

Bankerohan, Davao City to Cubao in 1975 with Jolibee as the first name. In 1978,

Cacktiong and his family drawn in the administrations of an administration expert,

Manuel C. Lumba. Lumba moved the business center from frozen yogurt to

cheeseburgers, after his examinations showed that a lot bigger market was ready to be

taken advantage of. Lumba, became Cacktiong first business and the board tutor.

Lumba next re-framed the name Jolibe to Jolly Bee and made the two words structure a

solitary name, Jollibee, evolving the "y" to an "I". Presently, Jollibee is a 30 year old

organization.

The Jollibee mascot was roused by neighborhood and unfamiliar youngsters' books.

Lumba next made the item names "Yumburger" and "Chicken Joy". He had the

organization integrated and rented a house on Main St. In Cubao, Quezon City as the

primary head quarters. Lumba planned a drawn out showcasing procedure: posting up

various customer advancements and traffic building plans. Cacktiong focused on that it

was basic to foster inside qualities. The stores were re-planned, the assistance changed
into a full self-administration, cheap food activity with drive-throughs. Not long later,

Cacktiong and Lumba went on a perception visit in the United States, went to food

administration and gear shows. Presently, Cacktiong put Lumba responsible for

establishment improvement.

In 2021 it operates in 34 countries, with over 5,800 stores globally.

Business Ethics of the Jollibee Foods Corporation

The Company's Code of Ethics and Business Conduct is established in serious areas of

strength for its upsides of trustworthiness, respectability, trust and greatness. The

Company attempts to keep up with the best expectations of business morals as well as

full consistence with every applicable regulation, rules and guidelines. Accordingly, it

guarantees that a framework is set up which will empower all partners: representatives,

merchants, franchisees, providers and other outside partners, to submit reports,

objections, or some other data in regards to any fake, unlawful or untrustworthy

movement in an unknown and classified way,

unafraid of response.

The Company observes honesty and integrity in its dealings with all of its stakeholders:

government, clients, colleagues, representatives and the overall population. The

Company leads its business and plays out its obligations with solid respectability and

amazing skill. The Company considers its franchisees, lessors, providers, administration

suppliers and other external gatherings as its esteemed accomplices in the Company's

development. The Company similarly approaches every one of its clients with deference

and kindness.
The Company’s Code of Business Ethics and Code of Discipline have been

disseminated to all directors, senior management and employees and all levels in the

Company are responsible for and required to administer the Code of Business Ethics,

including investigating alleged violations and determining corrective actions.

The Code of Business Ethics is addressed to the members of the Board of Directors

and employees of JFC and its subsidiaries (“covered persons”). For purposes of this

CoBE, subsidiaries are entities more than 50% of the equity of which are owned and

controlled by JFC. With respect to entities in which JFC has an interest but does not

have control, we encourage them to adopt and follow this CoBE as appropriate. This

CoBE is not addressed to the persons with whom we do business, though they are also

strongly encouraged to report any actual or perceived violations of the CoBE to

Corporate Ethics. Moreover, from time to time, JFC (or the relevant subsidiaries) may

choose to issue separate documents setting out our expectations from the parties with

whom we do business.

As a covered person, you have the following duties:

• to comply with this CoBE by applying it in your day-to-day actions and decisions and

exercising good judgment consistent with this Code, in the performance of your duties.

• to seek clarification in accordance with this Code from the persons authorized under

this CoBE to give such clarification, in case of doubt as to the proper application of its

provisions.

• to report non-compliance with this Code to the persons authorized under this Code to

receive such reports.

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If you are a manager, you have the following additional duties:

• to model and champion ethical conduct in your team;

• to provide guidance to your team members (and as appropriate, seek proper guidance

yourself in order to be able to provide such guidance) should you be requested to clarify

provisions of this CoBE. Noncompliance with this CoBE – including the duty to report

any non compliance with its provisions -may result in disciplinary action, including

termination of employment.

• to be vigilant about your team’s compliance with this CoBE and take the necessary

steps to immediately address any discovered noncompliance

• to encourage your team to raise concerns about non compliance with this CoBE

• to support any team member’s participation in any investigation regarding

noncompliance with this CoBE

Jollibee Foods Corporation Principles

We Conduct Our Business With INTEGRITY. We earn and maintain the trust of those

we deal with, both internally and externally, by conducting ourselves with integrity at all

times.

• We act in good faith, and are upright and fair in our dealings. Whether verbally or in

writing, whether to external or internal parties, we communicate honestly and

accurately.

• We honor our commitments and make only commitments that we can deliver. We

stand by our commitments and make only those commitments that are within our
authority to make and that the company can deliver. In carrying out our commitments,

we act fairly and responsibly.

• We do business, build relationships, and make decisions based on merit. We do not

seek to influence others or obtain any advantage, or allow ourselves to be influenced or

give to others any advantage, on the basis of gifts or favors. For a better understanding

of the applicable gifts and business entertainment policy applicable in your territory,

please refer to the Policy on Gifts

We Treat Everyone With RESPECT. We recognize the value of each person that we

deal with, whether internally or externally.

• We respect the dignity of all persons. We accord respect to all individuals and do not

tolerate any disrespect, discrimination, harassment, violence or intimidation.

• We strive to be inclusive. We do not discriminate, and embrace diversity. We make

decisions based on merit. We recognize and respect differences in cultures and beliefs.

• We respect the rights of all persons. We respect the rights of all persons, as may be

provided by law or contract.

We Are Committed to LAWFUL Business Practices. We have the responsibility to know

and comply with the laws in the territories where we operate.

• We comply with laws and regulations in the territories where we operate. The various

aspects of our business are governed by multiple laws and regulations, some spanning

multiple territories. We ensure that our business practices are in accordance with such

law and regulations as they apply to us. Legal issues can be complex; in case of doubt
as to the laws applicable to a particular course of action, please consult your territory’s

Legal department.

Capturing Filipinos’ Taste Buds

In the Philippines, people love to eat and are used to
doing so up to ve times daily, enjoying snacks in between
meals and a comfortable place to chat with friends
and loved ones. As a result, the nation had become an
attractive market for global players such as McDonald’s,
KFC, Wendy’s, Burger King, and Pizza Hut. Yet, despite
growing competition, Jollibee had managed to maintain
its dominant position as the leading fast food chain in
the Philippines, with a menu tailored specically to the
Filipinos’ preferences.
Jollibee’s keen insight and understanding of the Filipino
psyche had brought to everyone’s lips the promise of
langhap-sarap (freely translated, this means “smells good
so it must taste good”). In addition to meals with fries,
Jollibee oered rice or spaghetti with its entrees. Its moist
burger patties and spicy sauces were so distinctly Filipino
that Jollibee’s burgers were oen likened to what a Filipino
mother would cook at home. is strong understanding
of Filipino’s taste and preferences set Jollibee apart from
its competitors.
Capturing Filipinos’ Taste Buds
In the Philippines, people love to eat and are used to
doing so up to ve times daily, enjoying snacks in between
meals and a comfortable place to chat with friends
and loved ones. As a result, the nation had become an
attractive market for global players such as McDonald’s,
KFC, Wendy’s, Burger King, and Pizza Hut. Yet, despite
growing competition, Jollibee had managed to maintain
its dominant position as the leading fast food chain in
the Philippines, with a menu tailored specically to the
Filipinos’ preferences.
Jollibee’s keen insight and understanding of the Filipino
psyche had brought to everyone’s lips the promise of
langhap-sarap (freely translated, this means “smells good
so it must taste good”). In addition to meals with fries,
Jollibee oered rice or spaghetti with its entrees. Its moist
burger patties and spicy sauces were so distinctly Filipino
that Jollibee’s burgers were oen likened to what a Filipino
mother would cook at home. is strong understanding
of Filipino’s taste and preferences set Jollibee apart from
its competitors.
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Challenges encountered by the company

Threat of new entrants

As we know that new entrants are those companies that are not currently competing in

an industry but have the capability to do so if they choose. The degree of threat posed

by these new entrants depends on the entry barriers.

In order to put up a fast food restaurant there are a lot of things to consider and the

most significant would be the capital requirements to put up the business. A new entrant

would need a large amount of capital to enter the industry like the acquisition of

specialized equipments, establish brand awareness especially to the customers of the

existing firms in the industry, that's why it would be difficult for a new entrant to enter the

industry.

Jollibee which is a large firm definitely enjoys economies of scale because of their

commissaries, they are able to increase their production therefore reducing their fixed

cost which in turn reduces the per unit cost of their production, this cost advantage

discourages new entrants.

New entrants must be able to persuade the customers of existing companies to switch

to their product, if switching cost is low then it would be easy for them to convince the

customers. In the case of Jollibee there is medium switching cost because other

companies offer the same products at almost with the same prices, with also nearly the

same number of branches as Jollibee's but there is still the preferences of most

consumers to eat Jollibee products.

Rivalry among existing companies

There are a lot of companies competing in the fast food restaurant business and

through the years, Jollibee has been taking the lead. In the industry there is intensive

competition, accompanied by high demand from consumers, since it is a food business

there will always be a demand. Jollibee has always been identified with its rival

McDonalds, these two companies offer almost same products for breakfast, lunch,

snack, and dinner. They are so "in love" with each other, they stay as close as they can

get, with only a walking distance from each other.

If some competitors decide to leave the industry then the rivalry among existing

competitors decline. But companies cannot easily leave an industry, there is this so

called exit barriers, which impedes their decision to leave. One exit barrier would be the

specialized equipments that Jollibee use in their operation, these equipments has

already depreciated, it would be hard to dispose of them and they will be of little value to

other firms. There is high fixed cost of exit, Jollibee is a company with a lot of branches

not only in the Philippines but also overseas, to leave the industry would be to let go of

their employees, and Jollibee would have to pay them. For a company whose been in

the industry for more than 30 years, surely, it already established relationships within

the company, there is this emotional attachment, of stakeholders in the business, these

barriers would discourage exit.

Bargaining power of buyers

The buyers of an industry can sometimes exert pressures on existing companies.

Buyers or the customers of Jollibee are not concentrated; they offer their products to
different segments, so here the power of buyers is low. Moreover, consumers purchase

in small volume, so they would have less power but there is few switching cost so

Jollibee must be able to maintain and gain customers.

Bargaining power of suppliers

Jollibee, as the leading fast food chain in the industry, purchasing large volumes of raw

materials, makes the company as an important customer of its suppliers. There is low

supplier concentration, Jollibee can have other suppliers for its products however the

raw materials offered by the suppliers is an important input for Jollibee's operation, all in

all the power of suppliers is low.

Threat of substitute products

There are a lot of products that serve the same functions as that of the products Jollibee

offers, any kind of food would lead to the same function, some with even lower prices,

these substitutes have the capability to threaten the profitability of Jollibee, furthermore

there is only low switching cost involved. Even though this is the case, Jollibee has still

shown development in their business, customers still patronize Jollibee products.

Strengths

• Jollibee as one of the leading fast-food chain in the country

Jollibee Foods Corporation if undeniably profitable because it has a spot on the

top choices of an average Filipino diner that made them to be one of the leading fast-

food chain in the country. Aside from other fast-food chains here in Naga City like

McDonald's, KFC (Kentucky Fried Chicken) or Mang !nasal, Jollibee is one of the many
fast-food chains that can be considered as a true Filipino-made restaurant. Jollibee's

strengths also lie in having a dominant position in domestic market and achieving high

brand loyalty in Philippines. Jollibee also has experienced managers who assist the

franchisees to their success during the start up stages. They value quality over

anything, so they can sustain the loyalty of their customers.

• Adaptability to change and technological advancements

Jollibee is always adaptable to change and preference of their market. Since their main

target market are kids, Jollibee produces toys of every latest cartoon character and

bundle it with their meals. On the technological side the HappyPlus Card is the

Jollibee's way to adopt the "Near Field Communication" or NFC. NFC is a sensor device

where you will just point your card within four centimeters; the point will be credited to

you. The point that you will accumulate from the frequent purchase can actually be used

in other fast-food chains owned by Jollibee Corporation.

Weaknesses

• Delicious yet unhealthy meals

Jollibee is known for its great tasting foods especially when it come to burger and fried

chicken. Though the foods offered are undeniably delicious the nutrient content is very

poor. Since it is fast food we shouldn't expect that it is very nutritious and can be a

substitute for a home made meals. Many researches was conducted and proved that

eating frequently fast foods will result to obesity that could lead to many diseases and

complication in human's health.

• Too long approval on operations development

Some managers of Jollibee suggest new strategies and alternatives in terms of

operation of the chain. Some tried to make a proposal and submitted to the

headquarters in Manila but the problem is that the approving committee is very strict

and they scrutinize first every detail of the proposal. Sometimes quick decisions should

be made in order to respond with the sudden change in the environment to maximize

the profitability of the season.

• Limited menu offered to the customer

There are many tourists that visit Naga City all year round. Limited menu is one of the

weaknesses of Jollibee because the tourists are commonly Americans and included in

an American meal is beer or wine. The tendency of the tourists is to find another

restaurants that offer their preferred beverage.

• Growing numbers of competitors

There are many fast-food restaurants present in the Philippines today. Some of the

most popular names are McDonalds, Angels Burger, Chowking, Greenwich Pizza,

Albertos, Local Food Chains. If the number of competitors would continuously increase

then, there will be tendencies that customers will shift to another food chain and the

people now is divided.

• Weakening customer demand

Most of the consumers nowadays are becoming health conscious. When people begin

to choose the food that they will eat considering the health benefits, food served by

Jollibee will be last on the list including the other fast-food chains. This is very much

possible because of the diseases that are being discovered and most of these newly
discovered diseases are because of the unhealthy lifestyle and eating habits of the

people. Page | 13

• Bad economy

A bad economy can hurt Jollibee's operation that will result to missed growth target and

decreasing number of potential customers. With the current status of our economy in

this time of pandemic, this is possible if it doesn't change from slow-moving type to

average or fast moving one.

Opportunities

• Adaptation on products and services to culture and tradition

The opportunity in the fast food industry lies in the globalization of the countries. People

around the world are beginning to accept other cultures as their own and thus the

entrance into these markets are getting easier. Another opportunity is that, as time

pressure builds up for people, they want to look for food that is served fast and provides

good value to them. Thus people accept fast food as a substitute for a meal.

• First-mover advantage

Jollibee Foods Corporation should continue the search for countries that has not been

entered by the fast food industry or countries that has a few competitors. It is a big

opportunity for them because surely it will become profitable. As the pioneer in that

certain country in the fast food industry they can set the pace and standard based on

their advantage.

• Expanding abroad will be a great opportunity of Jollibee

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Currently, Jollibee has a lot of business venture abroad. They have many existing

stores overseas and they are continuously expanding. Expansion of their empire and

putting up more stores around the world will create a brand recognition and popularity

for their company.

Implications of Jollibee Foods Corporation on the Community

In response to the COVID-19 pandemic, the Jollibee Group has given Php220 million

worth of suppers for frontliners and families out of luck. From March to May 2020, we

have proactively given 3.8 million dinners to wellbeing laborers, designated spot faculty,

and impacted families in various areas across the country.

Jollibee is more advantageous than different eateries, furthermore, the cost of food is

less expensive and more reasonable and the thirdly they offer individuals exceptionally

quick assistance, as well as, scrumptious food.

The Jollibee stays faithful in its obligation to give pleasure to our clients, and that implies

doing our part in rationing our normal assets and protecting our current circumstance,

clean, and wonderful.

Jollibee Foods Corporation declared the timetable of the ninth version of the JFVA

where Filipino families who show demonstrations of liberality, sympathy,

innovativeness, and love for local area and climate will be feted with exceptionally

planned prizes and monetary rewards.

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Conclusion

Tony Tan Caktiong gave satisfaction to the Filipino people group through the food

sources presented by his organization. Jollibee Foods Corporation should keep on

understanding Filipino people group and the unfamiliar clients to answer with the

changing requirements of the market. Innovative work gathering of JFC ought to grow

from the general market climate down to the particular region of the business.

Rebuilding the hierarchical diagram into provincial based construction ought to likewise

be thought of. Having a provincial based design can give them one more upper hand

regarding the quick activity on issues and proposition that required an out ideal choice

in light of unanticipated circumstances. With these sorts of systems, JFC will keep on

addressing the requirements of their clients and will actually want to deliver item that will

suit the flavor of a Filipino tongue.

As an end, through the organization faces and is confronting quantities of hardships in

keeping their spot in the business, still it is entirely productive locally and globally. The

organization had the option to support their upper hand for quite a while and to keep up

with it up to this point is a difficult situation.

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References

https://reports.weforum.org/social-innovation/jollibee-foods-corporation/
https://bucketeer-db71ed0b-178e-4a82-bfd6
-d68a68e0de55.s3.amazonaws.com/public/uploads/COBE-Booklet-March-2017.pdf
http://www.quickmba.com/strategy/porter.shtml
http://www.investopedia.com/terms/b/barrierstoentry.asp
http://www.oecdbetterlifeindex.org/countries/brazil/
https://www.researchgate.net/publication/
353953889_Case_Study_Jollibee_Foods_Corporation
https://www.jollibeefoundation.org/#:~:text=In%20response%20to%20the
%20COVID,families%20in%20different%20regions%20nationwide.
https://www.ipl.org/essay/Advantages-Of-Jollibee-FJVZVHNSG
History of Jollibee Foods Corporation. (2016, Nov 27). Retrieved from
https://studymoose.com/history-of-jollibee-foods-corporation-essay