Bonif Report

20061233 Ahn Jinyeong20061227 Park Jaewoo

20061222 Kim SeongGyu

1. About BONIF (1) Company Overview (2) Economic Performance Analysis2. Strategic Management of Innovation (1) Source of Innovation - Inverse Thinking - Society Change - Global Issue - Change in Perception

(2) Types of Innovation (3) Timing of Entry (4) Core Competencies (5) Collaboration3. Business Analysis (1) SWOT Analysis (2) TOWS Analysis (3) BCG Matrix (4) 5 Forces Model

Contents

PartⅠ. About Bonif

PartⅡ. Strategic Management of Innovation

PartⅢ. Business Analysis

Intro

Company name : BONIFFoundation date : Sep, 2002Company volume : In 2010FYSales - 90 million dollarsAssets – 27.8 million dol-larsEmployees : 178 persons

Launched 1st store

Opened 100th store

Incorporated Bonjuk International Franchise Co., Ltd

Opened 500th store, Received the Annual Korean Franchise Business Award

Received the Best Korean Brand Award

Received the Grand Prize from the Korean Ministry of Industry

Opened store at ICN (Inchon International Airport)

Surpassed the 1,000th store milestone

2002

2003

2004

2005

2006

2007

2008

2009

Intro2010

Bon Dosirak startsWell Being Best AwardPresidential Award

2011

Strategic AlliancesYonsei Hospital JungGwanjang Ginseng

Surpass 100 billon won (100 million dollars) sales

2010

Bonjuk opened the first branch in Dae-hak road of Seoul in 2002, and has opened more than 1,000 branches as of 2009. Bonjuk has not only increasingly rate of opening new branch, but also very low closing rate.

The calligraphy character “bon” (本 ) comes from an image of a tree with firmly planted roots, signifying “principle.” At Bonjuk, ‘principle” means that we make no compromise on nutri-tion, taste, and quality of the food we serve, and observe the high-est standards we set. It also refers to the traditional brand cate-gories, such as the salad on rice (Bibimbap), rice porridge (Juk), and noodle (Guksu), all of which are representative health foods of Ko-rean cuisine.

Opening 5000 stores around the world by 2015 is our goal at Bonjuk. Coincidentally, the Korean gov-ernment is actively promoting Korean culture and food in the global market as its top priority agenda in 2009, perceiving it as the next – and a much larger - source of long-term economic growth to succeed the automobile and IT industry that brought Korea to its current international status.

PartⅠ. About Bonif

PartⅡ. Strategic Management of Innovation

PartⅢ. Business Analysis

(1) Source of Innovation – Inverse Thinking(1/10)

What food is good for people’s health?(In 2002)

It is food people eat when they ill

CEO, Kim Chul ho

Inverse Think-ing

(1) Source of Innovation – Inverse Thinking(2/10)

Past

Juk was used to be only “The diets for patients” in a hos-pital

(1) Source of Innovation – Inverse Thinking(3/10)

NowBonjuk changed juk’s images from “Diets for patients” to“Healtier food prod-ucts”

(1) Source of Innovation – Society Change(4/10)

According to the survey on the people’s awareness of Hanryu, korean wave, foreigners are more interested in korean foods than in the past. This means that korean foods can be exported to other countries

(1) Source of Innovation – Society Change(5/10)

Interest in healthy food is rising along with the expansion of the well-being trend.

Organic farming has been one of the fastest growing segments of U.S. agriculture for over two decades. Organic food sales have been growing at 20% per year since 1990, increasing from $1 bil-lion to $24.6 billions.

Bonjuk catched these trends earlier than other food companies Bonjuk catched these trends earlier than other food companies

(1) Source of Innovation – Global Issue(6/10)

Overweight rates are the highest in the United States and Mexico and the lowest in Japan and Korea, but have been growing virtually everywhere. This means there will be seri-ous healthy problems in worldwide.

(1) Source of Innovation – Global Issue(7/10)

Obesity has risen to the big issue of the public health policy worldwide. Be-fore 1980, the obesity rate was generally below 10%. However, it has in-creased rapidly in many countries, and more than 50% of the people in the half of the OECD countries are overweight. A key risk factor for numerous chronic diseases, obesity is a major public health concern.

(1) Source of Innovation – Change in Perception(8/10)

Slow food is an alternative to fast food, it strives to preserve traditional and regional cuisine and encourages farming of plants, seeds and livestock characteristic of the local ecosystem.

Fast food such as hamburg-ers and fries is very popular all over the world. It is popu-lar for customer to spend less costs and time

(1) Source of Innovation(9/10)

Inverse Thinking11

Society Change22

•The sales of organic food is increasing

•Korean food is interesting to foreigners

“These Sources lead innovation to Bonjuk”

Global Issue33

•Overweight rate is increasing

•Obesity has risen to the top issue of the public health policy agenda

(1) Source of Innovation(10/10)

Change in Perception44

“These Sources lead innovation to Bonjuk”

(2) Types of Innovation(1/2)

PRODUCT

BONIF rediscovered juk which could bring outstand-ing taste to the customers

PROCESS

BONIF introduced CK and de-livery system

(2) Types of Innovation(2/2)

RADICAL

Bonjuk is the first franchise to rediscover juk as the

healthful and delicious food

COMPETENCE-ENHANCING

New product such as ‘Ginseng Juk’ and ‘Abalone Juk’ uses Bon-

juk’s existing knowledge

(3) Timing of Entry(First Mover)

Brand Loyalty

• Launch first store in 2002 (‘ 죽이야기’ opened in 2003)• Achieve 75% market share

Reaping increasing returns

• Increase in sales about 30% annually

• Launch new franchise stores rapidlly

Market share

Bonjuk

죽이야기맛깔참죽현죽

(4) Core Competencies(1/2)

CK system

- Provide a variety of side dishes

- Prevent being sick of eating same side dish

- Limit in each franchise store to offer new and various side dishes

Introduce Central KitchenIntroduce Central Kitchen

(4) Core Competencies(2/2)

Convenient lunch box

- Provide delivery service instead of take-out system

- Focus on customers’ needs and make diverse lunch box

Increase revenue more than 3 timesIncrease revenue more than 3 times

More than 30% of the can-cer is related with nutrition

Distribution channel

• Develop recipe, preprocessing & cooking method and processed food

• Distribute the food using 1200 stores all over the country

Medical advice

• Participate in the process of choosing material and menu according to the result of clinical trials

• Provide advice in respect of nutrition

MOU

(5) Collaboration Strategy(1/2)

Distribution channel

• Develop recipe, preprocessing & cooking method and processed food

• Distribute the food using 1200 stores all over the country

• Advertise the ginseng juk

Diversification

• Diversify ginseng product

• Provide ginseng and advice about the manufacturing

MOU

Diversify their product

(5) Collaboration Strategy(2/2)

PartⅠ. About Bonif

PartⅡ. Strategic Management of Innovation

PartⅢ. Business Analysis

(1) SWOT Analysis

SWOT

Strength Weakness

ThreatsOpportunities

• Brand power of market no.1

• Well-being and healthful korean food

• Distribution and data processing system

• Dependency on parent brand ‘Bon-juk’

• Low recognition of Bonif

• Government’s interest in globaliza-tion of traditional food

• Trend in growth of well-being mar-ket

• Low entry barriers

• Difficulty in managing franchise stores because of increase of stores

• Possibility of health control scandal

(2) TOWS Analysis

TOWS

S-O (Offensive) (Risk Aversion) S-T

(Turn-around) W-TW-O (Defensive)

• Enter the global market using ko-rean food

• Marketing enforcing well-being im-age

• Expand range of business (‘Bibim-bab’, ‘Guksu’)

• Make star menu and brand image as no.1

• Optimize data processing and dis-tribution system

• Move the store to the core business area

• Reinforcing the competitiveness of bibimbab and launching the dosirak brand successfully

• Branding the Bonif company

• Complete franchise system

• Diversify the company to grow bibimbab, guksu and dosirak busi-ness

• Construct the best health control system

Star Question Mark

Cash Cow Dog

High

Low

Mark

et

Gro

wth

High Middle Low

Market Share

It has largest market share and its market has great potential to grow

(3) BCG Matrix

Position of Bon on BCG Matrix : StarPosition of Bon on BCG Matrix : Star

34

New entrant

Suppliers

Buyers

Substitutes

(4) 5 Forces Model

• BonIF has not only offline stores but also online shopping mall.

Instant food

IndustryCompetitors