Thu, Oct 18, 2001 page24

• Asian fast-food outlets find brisk market

  TASTY TREATS Retail chains from the Pacific Rim are finding a niche market in the US while competing with the big American restaurants

  • NY TIMES NEWS SERVICE
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  You want fries with that? How about a palabok fiesta? A banana langka pie? Or a buko pandan tapioca ball tea?

  Jollibee -- a fast-food giant from Manila -- recently opened its first store in downtown San Francisco, where it features these items and fried treats tweaked to Filipino tastes.

  The grinning, tuxedo-clad bee already presides over eight stores in California and plans to double the number of outlets in more states under a franchising plan.

  American brands have long conquered many a land by exporting US fast-food culture and tastes.

  But in the San Francisco Bay Area, foreign chains are finding success by borrowing from American methods and from their own traditions. Examples include Sheng Kee, a Taiwanese bakery opening its ninth store this fall; Goldilocks, a Filipino restaurant and bakery; Yoshinoya Beef Bowl, a Japanese noodle house; and Maria's Bakery from Hong Kong.

  Such purveyors have overcome challenges such as setting up a distribution system, identifying where to open, creating brand recognition and adapting to local tastes. They cater to the Bay Area's growing Asian American population, Asian tourists and adventurous eaters.

  The newest Jollibee, across the street from Moscone Center in San Francisco, serves one of the chain's most diverse crowds. About half the customers are Filipino.

  Jollibee, which dominates in the Philippines with a 60 percent market share, has beaten the Golden Arches juggernaut there for the past two decades.

  But in the US, "We will be facing the big boys on every corner," acknowledges Manolo Tingzon, Jollibee's vice president of US operations, who began his career as a McDonald's manager in 1981. "We recognize we are the latecomer."

  So Jollibee plays to its strengths by identifying locations that have concentrations of Filipinos. Likewise, other Asian food chains open up in growing Asian enclaves.

  "They know us and know the brand," Tingzon said. "There will be instant business we will generate."

  The chain's Daly City store, the first to open in the Bay Area, has experienced double-digit growth every year since it opened in 1998. On a recent weekday, Rino Millares, 25, a software developer, paid his second visit in two days to San Francisco's Jollibee.

  "It's tasty," said Millares, who moved from the Philippines to the Bay Area in February. He grew up snacking at Jollibee.

  The downtown restaurant -- which has lines spilling out the door and tables crowded with families, teenagers and business professionals -- entices curious passers-by.

  "It has cheeseburgers, so we're good to go," said Roger Erickson, 40, of Wisconsin, as he looked up at the menu. Erickson, and friend Dale Blank, 46, were in town attending an electrician's convention.

  The international march of chains such as McDonald's, Burger King and Kentucky Fried Chicken had its heyday in the 1970s and 1980s, as these brands flourished overseas, restaurant experts say.

  "Now we're seeing it's a two-way street," said Michael O' Sullivan, partner at consulting firm Bain & Co and a retail expert.

  Indeed, foreign chains that ape American restaurants often do not fare as well as those that serve a niche market. Foster's Hollywood, a Spanish restaurant chain with a movie-star theme, shuttered its Florida stores in 1996.

  Getting a share of the American belly and bite can be tough for foreign upstarts competing against established US food chains, said Alan Higbee, a restaurant attorney at law firm Fowler White.

  "They either have to change or let the American consumer develop a taste for their authentic food product," Higbee said.

  However, several factors have fostered the development of Asia-based food chains: telecommunications that enable companies to manage business from overseas, growing ethnic populations, and marketing channels aimed at specific audiences in ethnic publications and Internet portals.

  "We are just learning by doing, giving it our best shot and seeing how far we can go," said Mark Kao, 48, who opened the first US branch of Taiwan's Sheng Kee in San Francisco's Sunset District two decades ago. As the tech boom attracted large numbers of Asian engineers, the bakery opened more stores in Silicon Valley and on the Peninsula.

  "I think most immigrants, have a certain cultural shock. So we try to appeal to those people who miss food from their hometown," Kao said. That means cakes less sweet and bread less crunchy than in Western bakeries.

  Goldilocks, a tiny bakery and cafe founded by two sisters in a Manila suburb in 1966, now has 12 stores in California and 142 in the Philippines.

  With the founders' grown children now at the helm, the chain is planning more California stores in Concord, Mountain View, San Jose and San Diego. Though still family-run, Goldilocks hired a number of professionals to expand its business.

  Costco, a membership warehouse chain, sells Goldilocks spring rolls, sausages and breads. Goldilocks also ships goods from its Hayward manufacturing plant to retailers across the country.

  Balancing American tastes with traditional recipes is tricky, said Mary-Ann Ortiz-Luis, daughter of one of the Goldilocks founders.

  But she wants to popularize Filipino food as a matter of national pride. Spanish, French and Chinese tastes have influenced the island nation's cooking. The Goldilocks menu includes ensaymada, akin to a Spanish brioche; mamon, which is like a French sponge cake; and noodles with Chinese origins.
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