It takes a rare man to have success in food retailing, without having the sort of background that normally would be required to run an international fast-food chain. Born into a family who for generations has dealt with fine gemstones, Fred Mouawad (Ma-wahd) with his unerring eye for beauty and value, is the exception. Just over a decade ago, after being told by consulting firm that pizza would never be a staple food in South India , Mouawad “ literally tossed the report in the bin.” In India today, pizza is synonymous to the home-grown Pizza Corner, and in Thailand, the café environment of Coffee World preceded the entry of bigger coffee chains.
Mouawad is CEO and chairman of Bangkok-based GFA Factory, New York Deli, The Donut Baker, and Golden Pretzel. GFA (Global Franchise Architects) has 171 stores worldwide, and more stores are planned in Indonesia and Hainan, China, over the next three years. FPMJ spoke to this multifaceted man who admits being totally involved in every detail of running his operation (staff call him “Diamond Eye”)
FPMJ : As an unknown 10 years ago in Channel, how did Pizza Corner pitch itself to consumers? What are some of the marketing tactics that you may have evolved that are now being followed by your competitors?
Fred Mouawad : At the time we were the first international pizza chain to enter Chennai, and our focus from day one was to provide a great customer experience. In the initial days pizza was a very innovative product, so we focused on offering the original American pizza. A few years later we started experimenting successfully with localizing the product, and later we were copied by others. Over the years we have continued to innovate and our competitors have not been able to directly emulate our efforts. Zzapi the super hero figure representing Pizza Corner is an example of how we differentiated ourselves by appealing to children and families in particular. Our latest innovation with Conizza (pizza in a cone) and its nation wide TV campaign have been a great success. I am confident over the years we will keep on differentiation ourselves through innovation. That goal is actually reflected in our newly launched slogan which is “Better Pizza through Quality and Innovation” in
FPMJ: Why Bangkok for the first Coffee World, and not New Delhi?
Mouawad : Coffee World started in Thailand one year after launching Pizza Corner in 1996. It was just an opportunity that presented itself. At the time I started my venture capital business, and I had on colleague at the office that was very passionate about coffee. She had done her undergraduate studies at UC Berkeley, and her MBA at UCLA. She was very fond of the memories she had spending time with other students at local coffee shops, and we both know that the coffee category would emerge in Thailand so we wanted to gain first mover advantages as we did in India by launching Pizza Corner.
FPMJ: Are there more similarities or more differences among consumers where GFA operates?
Mouamad: I would say there are far more similarities than differences, but the differences cannot be ignored. They have to be identified, and catered to in order to offer a great customer experience. They key here is satisfying customers by offering a great product, store environment, and service at good value. Customers worldwide always appreciate and recognize a quality experience, and they look for the same parameters and that is the biggest similarity. The adaptation to differences is mostly around the product. Whenever appropriate we localize the product in order to appeal to local consumers.
FPMJ: What marketing policy would work in Thailand but not in India?
Mouawad: That is a difficult question because we look at marketing from a local point of view, so when we conceive a promotion we focus on local customer preferences and the historical performance in the market. Having said that, some marketing initiatives do respond better in some markets compared to others. In India for example consumers are more price sensitive, and respond better to low price promotions. Comparatively in Thailand consumers are less price-sensitive and they value promotions providing more for the same price. As a specific example in Thailand, Coffee World does very well selling its 22oz cold beverages, the largest of three sizes on offer, and when we offer an upsize on a new beverage introduction it works well. In India the highest seller is the 12oz drink, and we have sold very few 22oz. drinks. Indian consumers are not used to up-sizing yet, as they are not willing to spend more to get a larger quantity.
FPMJ: You have great looking stores, with an almost fine-dining environment for fast-food and quick service restaurants. How are the store premises and interiors developed, and how big a hand do you have in them? How about your logos?
Mouawad: I am personally involved in every single component of our store designs and promotional materials. Every design and promotion has so far been reviewed by me internally. I do this to set a standard that can then later be replicated with consistency. We are fortunate to have a great tem of 12-in-house designers, and I work closely with them to set the tone for each brand. Internally we work very systematically following detailed processes based on our quality management system which is 9001-2000 certified. For the design of each brand we first define the standard store specifications for each format of the brand (Kiosk to large dine-ins) such as the material boards, the furniture, the counters, the equipment, the menu, the branded look and feel components such as the wall paper and any decorative items. Once we define all the specifications we build a prototype in our corporate building, and then review the details of the prototype until we literally no longer can identify any flaws. As my background is in high-end jewelry and very fine gemstones, I tend to pay a lot of importance to the esthetic environment of any retail store.
Each brand is first conceived with me trying to find a name. In the process of finding a name I make sure the URL is available. Once I feel right about the name, I usually have a feel for how the logo should look, so I provide a brief to our very talented team of graphic designers. I review several variations of the logo until I feel we have it right, and can no longer improve upon it. The name and the logo are essential foundations to start the cycle of creating a brand. It is the embryo that sets the tone for the development of all the rest. The logo allows all of us to see the brand alive. It provides a tangible vision to a process that is still to be created.
FPMJ: You’ve said that it’s become hander and harder to find a good location at a fair rental price in Thailand. Is the same true in India? How this influenced your decision to expand your operations in other countries?
Mouawad: In India it is also difficult to find good locations, but the market is growing and there are over 500 shopping malls being constructed around the country. The market is still in its growth stages, and we expect that growth to be I the double digits over the next 10 years. In the last two years Thailand has reached a point of saturation in the food and beverage sector with a far bigger supply of outlets on the market compared to the growth in consumer demand, and that is primarily because too many shopping malls have recently opened. Having said that, we do recognize that every market is in different stages of its maturity cycle. In Bangladesh for example there is a very limited supply of international food and beverage operators, and a heavy pent-up consumer demand. Our franchise partner in Dhaka has opened six outlets in the first year with Coffee World and Pizza Corner and the result have been very positive. The brands have been received very strongly in the market.
FOMJ: Do you think there will be any differentiation from the GFA norm in the way you franchisee will operate in China?
Mouawad: Absolutely not! Our norms are all about continuously improving the customer experience at any of our stores no matter where the stores are located. The basic operating standard does not change for any country. Our systems are devised in order to consider local preferences and requirements by keeping our operating standards at the same level. We in essence use one operating system to manage multiple brands in multiple countries.
FPMJ: You have a presence in the new Thai airport (above), which is really a great hub for travelers. How do you think this will contribute to building awareness about your brands?
Mouawad: We are very excited about our presence at the Suvarnabhumi Airport in Bangkok. We have two prime locations on both ends of the departure area, and both are combination stores featuring Coffee World, New York Deli, and The Cream and Fudge Factory. Our combination stores have been very well received by customers as they provide a mini food court experience offering more choices throughout the day. In the example of the airport we offer coffee, fresh made to order sandwiches, and super premium ice-cream all in the same store with each expert brand offering the product. The stores cater to a truly worldwide audience, providing further evidence our brands have a universal appeal. (They) also expose our brands to consumers and potential franchise partners worldwide positioning our brands for their continued global expansion.
FPMJ: What factors are considered when opening a new food concept? How long does it take from conception to actual fruition?
Mouawad: We have built incredible capabilities in-house including out own interior design team, a construction company, research and development team, graphics team, quality management system, and our own academy to write all the training materials. Depending on the complexity of the concept we want to develop and on internal priorities it can take us anywhere from 3 to 8 months to develop a new concept. The brands we have so far built are all in the QSR ( Quick Service Restaurant ) category. We like to build brands in categories that are either proven in other markets or have the potential to weather short term fads, concepts that have the potential for multiple sites in an area, and brands that have a broad appeal offering value to consumers.
FPMJ: Pizza, coffee, deli, ice cream novelties, and now doughnuts and pretzels, Is there another GFA food concept in the works?
Mouawad: Building brands besides operating and franchising them is a very important part of what we do at GFA. Until we launch the brands we, however, do not provide any specifics. This year we are looking at launching one concept in the casual dine-in. This would be the first time we venture outside the QSR segment. We would like to build a complete portfolio in the food service industry covering several segments.
