This article was first published on DollarsAndSense.sg.
Launched in January 2021, MOS Burger at One Fullerton is the latest outlet (48th) opened by the Japanese fast food conglomerate in Singapore.
Ever since the first outlet opening at Isetan Scotts in 1993, MOS Burger has expanded to 48 outlets island-wide. Through expansion, two other outlet store concepts were also introduced in Singapore: MOS Burger Express and MOS CAFÉ. These outlet store concept differs from the regular MOS Burger outlet in their location, price, and menu offerings.
So why did MOS Burger open the One Fullerton outlet and implement varying outlet store concepts?
#1 Reach Out And Diversify To Different Types Of Customers
Being a brand that has been around in Singapore for over 28-years, MOS Burger has to constantly adapt to the ever-changing local food scene. Singapore’s fast food scene is highly competitive with a total of 491 fast food stores as of 2018. The fast food mass-market is highly saturated with other options such as McDonald’s, KFC and Burger King. In order to reach beyond the conventional fast food crowd, MOS Burger implements different outlet concepts to reach out to distinct customer groups.
The launch of MOS Burger at One Fullerton aims to target the tourist crowd with offerings of Tiger Beer and finger food platters at one of Singapore’s most scenic locations. Other MOS concepts include MOS CAFÉ which is closer to a sit-down Japanese restaurant with curry rice on the menu for the shopping mall crowd. On the other hand, MOS Burger Express aims to be a quick and convenient option for the takeaway crowd.
This diversification of customer base has worked well for MOS Burger as in FY2020, year on year global sales has increased by 4.3%.
#2 Leverage on Location Focused Strategy
Apart from targeting different customer bases, MOS Burger’s multi-store-concept strategy also involves tailoring store concepts to capitalise on each location’s unique points.
One Fullerton or Merlion Park is undeniably one of the most iconic locations in Singapore. However, conventional fast food outlets have yet to enter this locale due to the high rental prices of such a prime location. Due to COVID-19, rental prices in prime location fell by -14.7% in Q4 2020 year-on-year retail rental pricing, potentially paving the opportunity for MOS Burger to enter a prime location like One Fullerton.
Regardless, the rental price of One Fullerton would still be substantial, and a regular MOS Burger outlet may not have been a good fit for the location. Instead, MOS Burger launched a completely different outlet concept for their One Fullerton store.
A quick scan against One Fullerton menu against MOS CAFÉ menu would show that One Fullerton’s items are priced at an average of 13% higher than normal menu items.
|Menu Items||One Fullerton||MOS Café||Price Difference|
|Original MOS (w Cheese)||4.20||3.85||+ 9%|
|Spicy MOS (w Cheese)||4.40||3.95||+ 11%|
|Fish Burger||3.80||3.45||+ 10%|
|Teriyaki Chicken Burger||4.35||3.55||+ 23%|
Note: MOS Burger does vary their prices across the various outlets and this price difference may not be true for all outlets.
However, MOS Burger did not just increase pricing for their One Fullerton store, they also provided a whole new dining experience with a complete redesign of the restaurant to reflect the alfresco ambience of the location, new menu offerings and store-exclusives.
While more expensive than some of their other outlets, MOS Burger could arguably be the most affordable dining option at One Fullerton. With a high footfall from tourists and even Singaporeans looking to dine at the Merlion Park area, the overall strategy to open the One Fullerton outlet could pay off for MOS Burger.
The same strategy of capitalising on location’s strengths also applies to MOS Burger Express at Holland Village. Opened in November 2020, the express outlet is conveniently located near the MRT. This strategically places the express outlet within the traffic of commuters who can be potential takeaway customers.
Since the Express outlet only caters to takeaways, it is small and does not provide seating. The compact operating space allows MOS Burger to rent a high traffic location while keeping rental costs low. Additionally, to minimise decision fatigue for hungry customers, MOS Burger has truncated its Express menu to about half its usual offerings. This allows customers to decide swiftly and keep the queue moving especially during peak period, increasing revenue with the high turnover rate.
#3 Steep Competition Pushes MOS Burger To Increase Brand Awareness With Different Outlet Concepts
In January 2021, Singapore year-on-year total fast food sales fell by 6.7% compared to 2020. Over the past 5 years, the arrival of other global fast food brands such as Shake Shack, A&W, Jollibee and Five Guys has challenged the local fast food scene. With decreasing sales and increased competition, MOS Burger has to evolve its menu and outlet styles to compete against the new fast food entrants. The introduction of multi-store-concept strategy allows MOS Burger to retain its original brand position while giving it space to experiment with different menu offerings without impacting its original customer base.
Aside from local strategic branding, MOS Burger has its sights set on regional growth. As of FY 2020, Thailand only has 12 stores, 3 outlets in Indonesia, and 12 in the Philippines. Aiming to enter the Vietnam market this year, MOS has focused on South East Asia for franchising with a target of $430 million in revenue for international franchising. The position of MOS Burger at one of Singapore’s most prominent locations at One Fullerton would help bring awareness to customers or potential franchisees about MOS Burger. Conversely, the express outlet style (such as MOS Burger Express at Holland Village) could be a good litmus test to enter new markets without much capital expenditure.
The food industry in Singapore is everchanging, being adaptable is an essential feature for brands to survive. A tried and tested strategy, used by the likes of McDonald’s (McCafé), KFC (KFC Express) and other fast food brands, branching out to different concept outlets can increase the brand’s awareness and resilience. These new concept offerings also keep customers excited (hint: McGriddles) and engaged which is essential for any consumer-facing business.
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