GRETAI Securities Market senior executive vice president Daniel Chu (朱竹元) says that his daughter regularly visited a branch of MOS Burger near the Taipei Railway Station for a quick meal while she was attending cram school to prepare for her college entrance exam last year.
“She liked the ambience of MOS Burger and stayed there for hours studying,” Chu said, adding that his daughter, currently a university freshman, even thought about applying for a part-time job at Japanese fast-food chain.
“I would have been okay with her working at MOS Burger. It is good training because the service is good. The staff prepare the burgers fresh and bring the meal to customers’ tables,” he said.
If you think that MOS Burger is only one of the smaller players in the fast-food business in Taiwan, think again.
The Japanese brand, which was brought to Taiwan by Teco Group (東元集團) in 1991, has been quietly extending its reach across the country and had 210 outlets at the end of last month.
That makes MOS Burger the -second-largest fast-food chain in Taiwan in terms of outlet numbers.
There are currently, 353 McDonald’s outlets, 210 MOS Burger outlets and 133 Kentucky Fried Chicken (KFC) restaurants in Taiwan.
Teco owns a 30 percent stake in An-Shin Food Services Co (安心食品), the local MOS Burger operator, which licenses technology from its Japanese partner, MOS Food Services Inc.
The chain continues to win new fans because, as opposed to competitors who pre-cook their burgers, staff at MOS Burger only start preparing food after a customer makes an order, company executives say.
“This means customers have to wait longer in line, but that is what makes our service unique,” An-Shin president Amin Yuan (袁世民) said at a conference on Nov. 28 to brief investors on the company’s plans for an initial public offering.
“Despite MOS Burger being a Japanese brand, we have imbued it with a lot of local character and most importantly, we want consumers to eat with peace of mind, knowing that what they are eating is good for them,” added Theodore Huang (黃茂雄), a well-known local entrepreneur who heads Teco.
Taiwanese are growing more aware of the need for balanced, nutritious meals with organic ingredients, and MOS Burger prides itself on its offerings in that area. For example, the company introduced measures to track the origin of food ingredients like tomatoes and cabbages.
The company also works closely with local farmers and gives priority to local produce as a way of ensuring quality control, Huang said.
An-Shin has invested in a quality inspection lab, which examines pesticide residue on food ingredients and conducts routine spot checks on the cleanliness of drinking water and cooking oil, among other things, in its various outlets.
With the business gaining momentum, An-Shin plans to list on Taiwan’s No. 2 bourse, the GRETAI, in the middle of this month, to fund its expansion plans and beef up the brandname as it makes forays into international markets.
The company is scheduled to issue 5.2 million shares at a price of between NT$165 and NT$170 per share.
The food operator reported earnings of NT$150.61 million (US$5 million), or NT$6.22 per share, for the first three quarters of this year, up from NT$146.17 million, or NT$6.04 per share, during the same period last year.
In addition to its home market, An-Shin has also made tentative moves overseas, opening its first stores in China and Australia beginning last year.
The company currently has eight outlets in Fujian Province, a number that should increase to 19 by the end of this month, according to Yuan.
An-Shin is also looking to expand into other Chinese provinces and to have as many as 100 stores in that country by the end of next year, he said.
MOS Food from Japan retreated from China in the 1990s after making an unsuccessful effort to establish itself in Shanghai, Huang said.
It made a comeback last year — this time making use of An-Shin’s experience in Taiwan.
An-Shin selected Xiamen City in Fujian Province as a target for expansion, Huang said.
“The city is closer to Taiwan in terms of geography and culture, and consumers there share similar tastes,” he said
However, the firm’s Chinese outlets still have to work to “localize” their offerings and thereby cater to local demand. That includes larger burgers and a larger selection of beverages than are available in Taiwan.
In April, An-Shin officially opened its first MOS Burger outlet in Brisbane, Australia, a number that had expanded to three by the end of last month. The target is a total of 14 stores by the end of next year.
The saturation of the Taiwanese market makes overseas expansion an absolute necessity for the operator.
“MOS Burger was the first outlet in Taiwan to introduce rice burgers [a patty of meat between two rice cakes] which quickly became popular, and the first to offer sinks for customers to wash their hands in the dining area. It has also focused on made-to-order freshly prepared meals,” said Capital Securities Corp (群益投顧) in a report dated Nov. 24.
“These strategies successfully set it apart from McDonald’s and KFC,” the report added.
According to Capital Securities, robust domestic demand and the increasing number of consumers opting to eat out in China means that it is likely to be the future growth engine for An-Shin.
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