Do Your Homework!

The man responsible for T.G.I. Friday’s global growth is Jean Baudrand, vice president of international business development. FAD contributor and food industry consultant Tesla Martinez recently spoke to Baudrand about how his company approaches global markets.

Baudrand’s main bit of advice: “You must do a lot of homework before you can expand your brand internationally!” Here are some of his ideas about how to tackle that homework.

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Food & Drink: How did you get into the business?

Jean Baudrand: My career started with Burger King (BK) in asset management, where I was promoted to director. In the late 1980s, Grand Metropolitan, a UK company, acquired Pillsbury, which at the time owned Burger King. Grand Metropolitan assigned me as director of property development in the U.S. and then asked me to go to Europe to lead BK’s expansion into Europe, Middle East, Africa and parts of Asia. Since Yum! Brands intended to get their European business to grow again, they recruited me from BK.

I had to stop due to a tragedy in my life in 2006. The international travel certainly did not fit the requirement of my household at that point. But T.G.I. Friday’s approached me in 2009 to become their VP for international development. I really like the Friday’s brand – always have. It is a brand with a lot of roots in international and it performs very well. So, I accepted their offer.

FAD: How do you stay in tune with market needs?

JB: It is essential that I monitor the economic, social, demographic and political evolution of the countries in which we do business or the countries in which we would want to do business. To that end, we have secured support from various consultant groups that advise us on international strategy, particularly economic and political evolution as well as our industry. A large part of my information comes from those consulting groups and their publications and companies specializing in food and beverage data.

Another important element of keeping up with local markets is through conversations with our franchisees. No one is more attuned to the local business and evolution of the local country than our local franchisee. All this provides me a good idea on the best opportunity we have in the international markets.

FAD: What is the biggest challenge you face?

JB: Finding the right partner. Over 50 percent of the success of a venture into a foreign market is based on the quality of the partner you find. Quality partners are few and far in between; however, when you find them, and the organizations get along, it very often results in long-term success. In my opinion, this is what really has created the success of T.G.I. Friday’s in the international market.

The quality of our franchisee, their support of our business model and their belief in our brand has made all the difference in how successful T.G.I. Friday’s has been in the international market.

FAD: What is the most exciting development in foodservice and where do you see it evolving?

JB: In my opinion, successful developments in the last 10 years have been in the Middle East. There has been a desire on the part of the different franchise groups in the Middle East in the restaurant industry to develop quality establishments and to translate, as closely as possible, the essence of each brand they represent. The result has been some of the best and most beautiful portfolios of brand developments that I have witnessed coming from countries in the Middle East.

There have also been other great evolutions in the international market. One of the most promising markets in the world are Brazil, Russia, India and China, known as the “BRIC” countries. There is no doubt that what is happening in China has been absolutely monumental. The way the market has grown, the resources they have and the growth of middle class are all contributing to a fantastic opportunity. The business model in China, however, is very challenging, but the opportunity is certainly very large.

India is another country that experienced a similar trend in growth. However, the business model in India is a little more challenging since its infrastructure and ability to sustain development is still questionable. Furthermore, the growth of India’s middle-class has not been as impressive as in China.

Then Brazil, I think, has been just phenomenal. The way they have reversed the conditions they experienced 10 years ago has been impressive and so has been their growth. The business model in Brazil is probably much more palatable to those Western companies looking to go international because it’s a very similar environment and climate. So I believe this is probably the third most important and compelling opportunity in the international market.

FAD: What advice do you have for companies considering taking their brands into China?

JB:

    1. Take the time to study and understand the market.
    2. Build a local organization. It needs to be a Chinese business doing business in China.
    3. Take the time to localize your business. I don’t think any business should go into China with their Western perspective. If you do, do not expect to be successful.
    4. And, as you build a local organization, try to ensure you have plenty of local support. Gain the proper understanding of what the local business is all about by having the proper PR, commercials, the appropriate explanations of your business for presentation and print material, know how your business is going to work, and the local objective of your business. All this is critical to becoming successful in China.

Tesla Martinez is head of insights and strategy at Terra Nova Insights LLC, a boutique international development consultancy firm. She also blogs for FAD. For more information, email tmartinez@terranovainsights.com.

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