Mon, Sep 10, 2012 page14

• INTERVIEW: Wowprime reveals secret to its success

  While Taiwanese exporters struggle to cope with the global slowdown, Wowprime Corp, which owns 11 restaurant brands in Taiwan and China, is still thriving and looking to expand 20 to 30 percent in revenue each year over the next two to three decades. Wowprime chairman Stephen Day shared the company’s development plans and strategies for success during an exclusive interview with ‘Taipei Times’ staff reporter Crystal Hsu last month

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  Taipei Times (TT): Wowprime Corp (王品) is aiming to build 96 outlets to bring its total number to 311 this year [240 in Taiwan and 71 in China]. How is the expansion plan going?

  Stephen Day (戴勝益): The expansion is proceeding smoothly in Taiwan, but going slower in China, where ownership of property is in the hands of several individuals or firms, making the acquisition of leases complicated and time-consuming. As of July, Wowprime has 256 outlets on both sides of the Taiwan Strait, 210 in Taiwan and 46 in China.

  While the number of outlets may not be exactly what we had hoped for, we are on the right track to see our revenue and profit grow by 30 percent this year.

  

  Wowprime chairman Steve Day smiles on July 29.

  Photo: Yang Ya-min, Taipei Times

  [The company saw revenue rise 31.76 percent to NT$1.22 billion (US$41 million) last month from a year earlier, with cumulative revenue jumping 30.83 percent to NT$8.17 billion in the first eight months.]

  TT: Has Wowprime set any financial goals for next year?

  Day: We aim to boost revenue by 20 percent to 30 percent next year and for each successive year, while achieving earnings per share of at least NT$10. Any expansion faster than that would put too much pressure on our training capacity, even though we have plenty of capital and there is no lack of business opportunities.

  It takes much more time and energy for companies in the service industry to train employees, compared with manufacturing firms. In line with the expansion, we aim to increase our staff by 30 percent to 13,000 this year, from 10,000 last year. At the end of July, the number stood at 12,329, about half of whom are part-time employees.

  It is a big challenge to train new employees well enough that they can be efficient at their jobs. The turnover rate (for full-time workers) averages 2.18 percent per month, or 25 percent a year, meaning that for every 100 workers we hire, 25 quit.

  We want to keep the rate low, otherwise the time and money spent on training would be futile. This is why we limit our expansion to 30 percent a year.

  TT: Your company is ranked as the favorite employer among jobseekers and many of your employees are college graduates. Does that suggest a mismatch between the education the workers have and the tasks they must do at work?

  Day: I don’t think so. Currently, 67 percent of our employees have a college degree. We aim to increase that to 90 percent in 10 years to enhance our overall efficiency and quality of service.

  Employees with higher education are promoted more quickly because they demonstrate better reasoning and leadership. They are also better communicators and more resistant to pressure when dealing with customers and colleagues.

  Wowprime cooperates with several colleges to provide training courses for aspiring employees. We encourage those that take the courses to take leave if necessary to prepare for exams or do university assignments. We also encourage them to take trips abroad, engage in sports such as mountain-climbing and dine at Michelin-rated restaurants — such experiences will be help employees progress toward promotions.

  I agree that not all educational courses are useful at work, but any feelings of being mismatched dissipate once people figure out what they really want. This is part of the learning process that most people go through in life.

  TT: How is the economic slowdown affecting Wowprime? Will the company be adding new brands to its current 11?

  Day: No impact at all, judging from the financial results. It is difficult to get a table at any Wowprime restaurant, although waiting times may be shorter these days. Of course if there were any unprofitable venues, we would close them down.

  We intend to launch new brands in the first half of 2014. There are several options under discussion, but nothing is final. We are also in franchise talks with potential foreign partners to expand outside of Taiwan and China.

  For the future, the company aims to focus its resources on expanding the low-priced end of the market, like the hotpot restaurant chain 12 Sabu (石二鍋), which charges NT$198 per person for a meal.

  There is always demand for low-priced restaurants, which account for 80 percent [of the market]. I prefer serving customers who are dining on a modest income rather than serving the rich. It is a shame that people feel the need to spend NT$3,000 on a meal.

  I do not like how the media tout luxurious and extravagant lifestyles, because this serves only to fan discontent among those who cannot afford that type of life and ends up deepening social divisions.

  In my opinion, convenience store operators command more respect from the grassroots public than luxury car dealers. When a luxury carmaker goes bust, people do not feel very sorry. However, many more care when a convenience store shuts down because it affects them.

  However, we will not make a foray into the fast food sector, where US giant McDonald’s has complete dominance worldwide, despite the high turnover.

  TT: What do you think about the government’s efforts to develop the tourism sector? Does Wowprime have any plans to expand into the hotel industry?

  Day: I think it is correct for the government to promote a service-oriented economy. There is little manufacturing activity in Singapore or Hong Kong, but they enjoy higher per capita income than Taiwan.

  Taiwan can catch up in 10 years, because it is blessed with many scenic attractions. In fact, Taipei is ranked as one of the favorite destinations of backpack travelers.

  Wowprime has no plans to expand into the hotel industry or purchase stakes in ventures outside of the restaurant industry. Our business in China alone can sustain a rapid rate of growth for the next 20 to 30 years.

  TT: Would you share some of the secrets to running a successful restaurant?

  Day: We conduct daily opinion surveys and retire dishes that get poor reviews. However, it is our hardworking employees that are the company’s biggest assets. In addition, I am a firm believer in the teachings in Analects of Confucius (論語), a collection of sayings and ideas attributed to the Chinese philosopher Confucius (孔子).

  That is why I forbid stock speculation among my employees and encourage traveling abroad and shun any involvement in politics. Guided by the teachings, I lead a simple and quiet life and give away 80 percent of my wealth to poor children to sponsor their education. The remaining 20 percent is more than enough to maintain a decent living.
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