Question

Mo’men, the sandwich company, launched its first branch in 1988 as a family-run business for sandwich takeaway and delivery. Today, Mo’men is the third biggest player in Egypt’s fast-food market and has the third biggest market share, serving over 9.5 million customers a year. This transformation from a small family business to one of Egypt’s leading fast-food players did not happen overnight; it is a result of a combination of ingredients, which, when put together, created the perfect recipe for success.

When the three Mo’men brothers first launched Mo’men, their main focus was to define its brand identity and product offering. They succeeded in building a brand with a local family feel. They also succeeded at differentiating Mo’men’s product offering across three levels: product composition, product packaging , and product variety. Once brand identity and product offering were defined, the next challenge was to expand Mo’men’s operations across Egypt without compromising the quality of its products or services. In order to do so, clearly defined operating standards had to be established and implemented. Accordingly, the Mo’men brothers developed the Mo’men standard review to audit the company operations and ensure consistency across all branches.

The idea behind Mo’men was to offer innovative sandwiches for quick pick-up or delivery to customers. The first branch opened in Heliopolis and did not have a sit-in area for dining. The business started with a capital of EGP 12,000 (US $2000) and no brand recognition. When the company launched, the main objective of the three brothers was to turn the store into a profitable, revenue-generating business; they successfully did so.

The first ingredient in Mo’men’s success was finding a catchy, easy to remember name that set it apart from international and local brands that would enter the Egyptian market. The name Mo’men was initially chosen in reference to the last name of the three founding brothers. This name has built the foundation for Mo’men’s brand image: it is catchy, easy to remember name with a local ring to it. “Mo’men” translating into ‘faithful” or “believer”, has a differentiated proposition from international competitors. It is seen as a home-grown champion in the Egyptian market which offers a blend between local taste and culture with international branding and quality.

Building a brand based on a family name instilled the second ingredient in Mo’men’s branding success: a strong sense of family culture. From the start of its operations in 1988 till today, Mo’men continues to value and emphasize the sense of family in its working culture. For instance, when Mo’men opened its second branch in Agamy, a popular summer destination in Egypt, its staff wore shorts and t-shirts to mirror the culture of its clients. The Agamy branch became an instant hit, and further expanded recognition of the Mo’men brand.

The second ingredient to Mo’men’s success is differentiation of its products. Mo’men was able to differentiate its products on three levels: product composition, product variety and product packaging.

Its key competitive advantage was to offer innovative sandwiches that were not already present in the market. The ingredients used were available and well-known in the market. However, the Mo’men brothers succeeded in combine these ingredients to create sandwiches that had anextra twist to them. For instance, when M’men first started , it was renowned for its shawarma sandwiches. The success of the shawarma sandwiches was due to the addition of extra spices that other shawarma sellers did no add. There was no R&D department. Instead the three Mo’men brothers would just try adding or removing ingredients until they found the perfect combination for the company’s signature sandwiches, such as the Chicken Keuive, were developed.

Mo’men also provided its customers with a large variety of sandwiches, making it one of the few players in Egypt fast-food market to offer such a wide range of choices. For instance, Mo’men offers customers six categories of food: chicken, seafood, salads, snacks and deserts. This categorization is similar to ther players in the market. However, what is different is the large number of different products offered under each category. Mo’men offers 12 beef sandwiches, 12 chicken sandwiches, 6 seafood sandwiches, 6 types of salads, and five different deserts; thereby ensuring every customer’s taste is met.

The Mo’men brothers then took an extra further step in differentiating their products. Not only did their sandwiches taste different , they were also packed differently. All sandwiches are packed in a colorful , high-quality carton, which is color-coded according to type of sandwich. Beef sandwiches are packed in red cartons, chicken sandwiches are packed in warm yellow cartons, and seafood sandwiches are packed in golden yellow cartons.

As production of Mo’men sandwiches began to grow, the Mo’men brothers wanted to ensure that all Mo’men sandwiches looked and tasted the same, regardless of who assembled them and where they were served. In order to fdo so the Mo’men brothers began to define operating standards. Operating standards included the exact amount of ingredients to be used in each sandwich, the amount of time each sandwich should be served in store, the exact way of communicating an order between staff, and so on. The Mo’men brothers recall the starting point for defining operating standards began with defining the exact amount of condiments to be used in each sandwich. Condiment jars were weighed before and after each sandwich was made. The net weight became the set target for condiment use per sandwich. Today, each Mo’men store has identical menus and identical sandwiches. Clearly defined operating standards and operating processes have enabled Mo’men to grow without compromising the quality of its products or service.

Clear definition of operating standards and processes enable Mo’men to deliver the same level of quality across its branches. However, in order to sustain this level of quality over time, a special ingredient needed to be present: the auditing of operating standards and processes. Auditing occurs in a cycle. It refers to the examination of each operating standard to ensure it is fully followed as well as continuous identification of ways to improve each operating standard. For example, when it comes to auditing operating standards for Mo’men sandwich delivery, an auditor examines each step involved in delivering the Mo’men sandwich , sets a target for the time this process should take, and continuously looks for ways to exceed the target delivery time. These new ways become the basis for anew action plan to improve delivery time, which is then audited again. Accordingly, the company has developed the Mo’men standard review (MSR), which is a scoring system for each restaurant, designed specifically to audit Mo’men’s level of service, quality and cleanliness. Each branch has a quality team which is responsible for filling out the MSR and communicating it to the branch staff. The MSR pinpoints critical areas of operational improvement. On reviewing the score, the branch’s staff can identify operational strengths as well as development areas. These development areas form the basis of a new action plan to further improve operations.

This combination of ingredients has created the perfect recipe for Mo’men’s local success. Mo’men restaurants are serving more than double the number of customers and achieving double the sales per restaurant compared to any of the international brands operating in Egypt. Today, Mo’men restaurants are in the process of rapid expansion to open more restaurants, serving Mo’men sandwich lovers all over Egypt and Overseas.

Mo’men’s next challenge is global expansion of its brand and products. It has set out on this path via a series of joint ventures and acquisitions. In October 2005, Mo’men opened its first branch in Sudan, which became an instant success, generating revenues four times those forescasted before its opening. Since then, Mo’men has opened up branches across the Arab world and beyond, with eight branches in Bahrain, three in Lybia, two in Sudan, one in Malaysia, and one in the UAE. The UAE expansion began in 2007 as a joint venture between Mo’men and AL Islami food, with a 15 year span and a total investment of US$22 million. In Malaysia, Mo’men is looking at acquiring a chain of about 20 restaurants for approximately US$5 million. According to Mo’mem’s chairman, the company is looking to acquire various local firms working in food production outside the meat and dairy sector, and has up to US$12.5 million to exapanf ist market presence globally. Saudi Arabia, Kuwait and the Emirates are among the markets in which the group is eyeing acquisitions.

Mo’men has gone from a small local takeaway and delivery business to Egypt’s third largest fast-food player after MC Donald’s and KFC. The Mo’men brothers leveraged Mo’men’s success in Egypt and aspired for global growth. Through a series of acquisitions and joint ventures, they were able to expand gradually throughout the Arab world. Mo’men’s plans dp not stop at global expansion. Mo’men group is planning to sell a 40 per cent stake in itself in an initial public offering (IPO)in late 2012. The IPO’s value would not be less than US$70 million. If Mo’men moves in this direction its main challenge would be to maintain a favorable environment for effective corporate governance, where each employee’s role is clearly defined and communicated, starting from the chairman all the way to the cleaner. Corporate governance is a key ingredient in maintaining transparency to investors.

the Q is :what expansion strategies did momen pursue? and what is his branding strategy ?

Answer 1

Branding Strategy of Momen -

In local market ->

The first branch opened in Heliopolis.

Mo’men opened its second branch in Agamy, a popular summer destination in Egypt.

In global market ->

It has set out on this path via a series of joint ventures and acquisitions for global market. In October 2005, Mo’men opened its first branch in Sudan, which became an instant success.

Mo’men has opened up branches across the Arab world and beyond, with eight branches in Bahrain, three in Lybia, two in Sudan, one in Malaysia, and one in the UAE. The UAE expansion began in 2007 as a joint venture between Mo’men and AL Islami food, with a 15 year span and a total investment of US$22 million.

Branding -

They always believed in quality and variety.

Their main focus was to define its brand identity and product offering. They succeeded in building a brand with a local family feel. They also succeeded at differentiating Mo’men’s product offering across three levels: product composition, product packaging , and product variety.

Mo’men brothers developed the Mo’men standard review to audit the company operations and ensure consistency across all branches.

The idea behind Mo’men was to offer innovative sandwiches for quick pick-up or delivery to customers.

The first ingredient in Mo’men’s success was finding a catchy, easy to remember name that set it apart from international and local brands that would enter the Egyptian market.

The Mo’men brothers then took an extra further step in differentiating their products. Not only did their sandwiches taste different , they were also packed differently.