Local food outlets taking more profits as to their foreign counterparts
Interview with Mr Naim Anwar — President & CEO, Crescent Star Foods Ltd
Mr Naim Anwar has been in business for over last thirty years in various trades out of which major part of 22 years has been in insurance working in various roles from an agent to the current CEO level with an accounting background with vast corporate experience spread over all areas of finance to underwriting to reinsurance to sales and operations. CSIL (Crescent Star Insurance Ltd), the parent company is in 60th year of insurance business and I am here as Managing Director & CEO. The CSG (Crescent Star Group of Companies) while having interest in technologies, luxury retail outlets for fashion/beauty and luxury has interest in steel business, also owns and manages its subsidiary Crescent Star Foods (Pvt) Ltd which has master franchise rights of various brands including the flagship brand of Golden Chick Texas-based chicken franchise. Golden Chick is celebrating its 50th year and into its Golden Jubilee Year (2017). Golden Chick is a strong brand with vast variety of chicken fried/roasted and grilled and the specialty is its tenders. The plan is to have thirty stores in Pakistan over a period of time. Currently, two stores are up and running while in 2017 another two stores will start operations.
PAGE: YOUR VIEWS ON THE COMPETITION BETWEEN LOCAL AND FOREIGN FOOD CHAINS:
NAIM ANWAR: Local food outlets are doing well as far as profitability is concerned and have a big market share also, however, it will not be fair to compare the foreign brands with local as this will not be like to like. Foreign brands maintain a very high level of standardization and quality control process with strict audit and check and balance. The royalty and franchise cost paid to brands fully justify the additional cost. Having said this, the local food outlets do contribute a lot to the vast market, which is still developing and has a high potential.
PAGE: YOUR COMMENTS ON THE FOOD FRANCHISE BUSINESS IN PAKISTAN?
NAIM ANWAR: In a country of 225 million, we only have currently around 300 fast food international outlets spread over various brands. There is a huge market waiting to develop with the fast changing trends of both gender working and moving to middle class population with two thirds of Pakistan population being between ages of 19-30 and the trend of both genders working. This will become a need of the day to go for fast food instead of eating out being only luxury.
PAGE: YOUR VIEWS ON THE ADVERTISEMENT BY FAST FOOD SECTOR OF PAKISTAN:
NAIM ANWAR: Advertisement in the food sector is important from branding position and awareness of new products, which every brand keeps introducing, and the deals, which are updated very frequently. Food sector plays a very important role in advertising industry.
PAGE: HOW WOULD YOU COMMENT ON THE FUTURE PROSPECTS FOR THE FOREIGN CHAINS OPERATING IN PAKISTAN?
NAIM ANWAR: The scope is vast for foreign chains operating in Pakistan, however, the local entrepreneurs will have to respond in the same coin as it involves losses in the first few years before reaching the stage of breakeven leading to profitability. This needs a lot of patience and game of nerves while understanding the long term gains. To reach the level, the journey needs a long term strategy.
PAGE: COULD YOU KINDLY TELL US ABOUT THE JOURNEY OF FAST FOOD SECTOR OF PAKISTAN?
NAIM ANWAR: The journey has been very slow and has been badly affected due to the security reasons and the political instability in the country has gone through. Foreign brands have been very reluctant with accepting Pakistan while they fully appreciate and are aware of the vast potential the country has and growth of the large population has always been on their radar but the confidence has been lacking.