Just Falafel CEO and founder discuss developing a global food franchise in the Middle East

by  — 28 October 2012

TheEDGE spoke exclusively with Mohamed Bitar, founder and managing director, and Fadi Malas CEO of Arab fast food chain Just Falafel about the global success of a brand that started in the Middle East.

Fadi Malas, CEO of Just Falafel

When Mohamed Bitar, founder and managing director for Just Falafel first moved to Abu Dhabi from Lebanon more than a decade ago, he says the first thing he went looking for was a falafel sandwich, something he had been eating for years growing up. What Bitar found at local Lebanese restaurants was not the great experience he was used to. According to Bitar the falafel has been around for more than a 1000 years, essentially a fried ball made from either ground chickpeas or fava beans depending where in the Arab world you grew up. The origins of the falafel are contentious with varying stories, according to ‘Gastronomica: The Journal of Food and Culture’ its origins trace back to the Copts in Egypt who ate it as a replacement for meat during Lent. He says, “because it was a poor man’s food, nobody has given it the attention it deserves” and that is where the idea for Just Falafel originated. Bitar and his wife and co-founder Reema Shetty opened their first outlet in 2007 at a location in Abu Dhabi, and today they run a franchise with more than 450 locations.

Fadi Malas, chief executive officer says the success of Just Falafel has been its uniqueness in being the first of its food category to appear in malls as opposed to the traditional way it was offered. From the outset Bitar was interested in developing the falafel concept beyond its humble origins. “The tahini and pickle that usually come with the falafel sandwich is a somewhat acquired taste. That’s why we started the Indian and Greek sandwiches, to have a different take and attract different nationalities,” says Bitar. From there on the aim, according to Malas was to develop a well-made menu to satisfy the palate of a 21st century lifestyle.

The challenges inherent in their concept are numerous claims Malas, “They come from everything we touch. Our ability to convince people to buy our franchise, to our ability to convince mall operators and developers to give us locations to have people buy our food in such a diverse and competitive meal proposition continue to challenge us every day.” In a highly competitive food industry, their unique product helps them stand out, he adds. “We are continuously competing on meals, if you go to the food court, you can’t have your favourite meal three times in a row,” says Malas. “As a customer one wants to be able to know that there is an option to try different things, and Just Falafel is one of the unique options available across food courts today.”

With two outlets already opened in Doha, Malas says the expansion into Qatar was a natural one. As a nation that has made its mark on the global level when it comes to retail Malas feels, “the dynamic economy and its high tolerance for new products” has been reflected in the overwhelming response to their outlets.
Just Falafel works solely on a franchise model; they have completely divested themselves of managing any stores including selling off their first store to a franchisee. When asked why they decided to take this route, Malas explains, “At the rate we are growing we couldn’t do it ourselves without partnering up with people who will co-invest on the retail front while we invest on infrastructure in the back end.” Since taking over the daily operations of business in March, Malas has set a blistering pace with plans to open a Just Falafel outlet at an average of one a week this year.

Malas feels that the most important thing to look for when filtering out potential franchisees is to find “someone who believes in the concept as much as we do. Somebody who believes our edge is that we are at the forefront of this food category, and I mean globally.” As a company quite driven by their culture, believing in their story is what matters most to them when hiring. “Our belief is that Just Falafel will be able to do to this food category what Starbucks has done to coffee,” stresses Malas. When asked about the ambitious plans for opening a store every week this year Malas admits that it has been 15 months in the making since they first started franchising, as a large backlog of stores plan to come online this year.

After having secured their first location in the United Kingdom, Just Falafel is working with Wolff Olins, the agency behind all the brand design for the recent London 2012 Olympics to develop their global image. “We are a global brand and we like to work with global advertisers that understand the complexity of cross-border propositions, and we try as much as possible to secure such partners,” explains Malas.

When it comes to marketing, in a highly competitive and saturated market Just Falafel has managed to spread their brand extremely successfully through social media. “This was the only chance we had of exposing our brand at the local market and global market level,” says Malas. He explains that it would have been prohibitive for them to compete with the huge budgets of other established food operators.

Their ability to market effectively is a result of a well-communicated brand image that connected with people using targeted ads on Facebook. The social media strategy which Malas tells TheEDGE was developed in-house, helped them secure numerous franchise opportunities, and as Bitar explains aided them in “covering their five year business plan, in one year.”

Malas seems like a man extremely confident of his product, this is nowhere more evident that when he speaks about expanding to new markets. “For as long as I can remember, growing up they talked about globalisation. Today I think you can comfortably say that we eat food from all over the world wherever we travel, and I think there is quite a high tolerance for trying food in different categories.”
He mentions that in certain markets there is a definite gap for new food types, and that falafel has long been forgotten. “We are offering it in a fashion that would please today’s standards of living, if sushi can be popular then why not falafel?” points out Malas.

Bitar says the success of Just Falafel can be attributed to a variety of different reasons and not just their marketing. “If you look today at the fast food sector, it’s all junk food and preservatives, we have chosen a niche that is extremely health conscious. “All the falafel shops will buy the cheapest ingredients so they call sell for cheap, we did it the other way around,” adds Bitar. “We bought the best ingredients and were gutsy enough to try and sell it at AED7 (QR7) while everyone else sold falafel at AED3 (QR3).” Just Falafel’s meal proposition is also one that appeals to vegetarians, with expansion plans for India, a nation with a significant vegetarian population this should play well in their favour.

Their timing of when they started the franchising drive was also great, points out Bitar, due to the downturn in the economy “People didn’t want to keep money in the bank or buy real estate or put their money in the stock market.” Their shops, which are not capital intensive to set up at US$ 100,000 to 150,000 (QR 364,000 to 550,000), allow for great returns and a proven concept in other outlets make for a fairly attractive investment. Bitar takes pride in the fact that in a region with so many entrepreneurs, they are today the largest falafel franchise in the world.

Bitar says they will not rest until they hit 15,000, maybe 20,000 locations. “If you look at the biggest franchise in terms of locations, Subway has some 37,500. With 450 stores we still have a long way to go, but we will get there.”

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