A lauriat of ideas

Twice a month, Ma. Theresa Jolloso reports to the Chowking Foods Corp. headquarters for the meeting of the New Product Board. "This is when we present six new products and 12 improved products to senior management," said Jolloso, who heads research and development.

On the average, two new products and two improved products would be approved for market testing every quarter.

"Chowking’s most successful new product launch in the last 12 months is the lomi. Of the 12% to 14% increase in sales which can be traced to new products, lomi accounted for 5%," said marketing manager Virgilio Ajero.

Lomi, which was launched in January 2002, is part of the Chowking’s noodle line, which has increased its sales this year by 200%.

To Market

The idea to come up with lomi started at the New Product Board, which is informally chaired by president Rufino dela Rosa. "There was agreement that the noodle side of the business needed rejuvenation. Although it has traditionally been the second biggest revenue source, sales has become stale," said Ajero.

Jolloso and her R&D went to work. "We benchmarked the lomi stalls in Batangas and the lomi stores in Taiwan," she said. "In Batangas, we found out that customers wanted generous servings and lots of ingredients to go with the lomi. The Taiwan lomi was spicier because of the many herbs used."

The task of coming up with Chowking’s version of lomi fell on the two full-time Hong Kong chefs who are based in the company’s plant/commissary in Muntinlupa. The first batch of lomi that the New Product Board tasted was deemed too salty and the serving portion was thought too small. Daily servings were sent to dela Rosa and other members of the board until the product received an acceptable rating of 85%.

The product was then market tested to reduce the margin of error. "We randomly asked in-store customers and mall visitors if they liked lomi. If they did, we invited them to try ours," said Ajero.

The market testing continued until the internally-set acceptable rating was reached. The final test–called the backyard test–was done among 50 employees who knew their noodles.

"Just like our other products, the lomi that is served in Manila is the lomi that is served in Cebu," said Ajero. "We, however, understand that some parts of the country like their food a little spicier. That’s why our stores in Bicol and Iloilo automatically include a packet of hot chili oil with each order."

Product Quality

Being 70% mechanized, the Chowking plant hums with the sound of machines. One of its newest machines is a P1-million siopao-maker from Japan. "The pre-production of our ‘chunky siopao’ took longer than usual. Initially, the meat that we cut into cubes would disintegrate and turn into mush after cooking," said Jolloso. "At the other end of the spectrum, ‘crispy noodles’ had the shortest pre-production because all the raw materials were easily available.

To control the quality, Chowking makes all its noodles.

"During our benchmarking period for lomi, we discovered that it is a common practice among small stores and restaurants to get their supply of noodles from the wet market. These noodles are oftentimes smelly because a lot of preservatives are used to increase shelf life. These noodles are also sometimes soggy," she said.

Chowking’s noodles have a shelf life of one and a half months, in part because a preservative called lihia is used in the production process and in part because the finished noodles are stored in the chiller.

In the course of business, however, shelf life is not a major issue since the stores do not overstock. Noodles made and delivered to Metro Manila stores are consumed within a week. For stores in Visayas and Mindanao, the time frame from production to consumption is two weeks.

New Products

Behind the drive to constantly come up with new as well as improved products is the desire to drive more sales. With an average spending per head of P50, Chowking has come up with products like the P85-soy sauce chicken that are positioned as premium and upscale even as it continues to serve its core market of students and employees with its "value delights".

This is the same rationale behind the P29-gulaman which is priced higher than the average spending for drinks of P20 a head.

Last month, the new dimsum line was launched in time for the higher spending pattern of customers in the fourth quarter.

Currently being piloted in a few stores are additions to the breakfast category such as garlic rice, danggit, and brewed coffee. A new seafood product is being market tested for a launch just in time for the Lenten season next year.

"Right now, we own summer. We’re the only food chain with higher sales in summer than during the Christmas season because of our halo-halo. We want to own the rainy season with our congees and noodles," said Ajero.

At the end of the day, Chowking’s success formula is simple: It gives its customers a reason or two to keep on coming back.