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Pizza Hut pushes rivals to up game: UFG CEO

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Heng Sengly, the group CEO of United Food Group Co Ltd (UFG), the operator of the US-based Pizza Hut franchise in Cambodia. Photo supplied

Pizza Hut pushes rivals to up game: UFG CEO

The prevalence of daily fast food consumption and incremental demand for the convenient meals has emerged as a major incontrovertible trend in the modernisation of living conditions in the Kingdom.

The Cambodian pizza market has seen explosive growth in recent years, generating no less than $100 million in revenue in 2019 and forecast to grow 15-20 per cent each year, according to projections made by local food chain corporation United Food Group Co Ltd (UFG), the operator of the US-based Pizza Hut franchise in Cambodia.

All the while, new franchises are entering the market as existing chains roll out expansions. The first branch of Pizza Hut opened in August to much fanfare in the capital’s Tuol Tompoung I commune.

UFG has its work cut out for it to contend with the increasing strength of profitable competitors, notably the Bangkok-based The Pizza Company, a major player whose founding company Minor Group had been Thailand’s Pizza Hut franchisee from 1980-2000.

The Post business editor May Kunmakara sat down with UFG group CEO Heng Sengly, to discuss the journey of bringing the brand to the Kingdom, and the company’s strategies to acquire a bigger slice of the Cambodian pizza market.

How did the ball get rolling in the first place for Pizza Hut’s foray into the Kingdom?

The story began in 2020 when an advisory firm in Cambodia approached us, showing intent to bring Pizza Hut into the Kingdom. At the time, Yum! Brands Inc, Pizza Hut’s parent company, was looking to expand the brand in the Asia-Pacific and the advisory firm had been in charge of finding a potential partner for the venture.

We joined in the bidding with several other candidates, most of which were subsidiary firms of Cambodian conglomerates – one was a company from a nearby country. After a lengthy process, we were honoured and proud to be chosen as the operator of the world-class Pizza Hut in Cambodia.

And why was UFG chosen over competing bids?

We were chosen because we’d clearly know how to make the brand successful in Cambodia. We have two decadesof experience in food and beverages and this is proof that we have the credentials to ensure the smooth operation of Pizza Hut in the Kingdom.

UFG is the owner of the leading Cambodian restaurant chain Park Cafe – which runs 20 stores in the Kingdom – and is majority owned by V-Trust Group with Singapore-based EMIA Investments Cambodia.

That being said, with enough capital, resources, expertise and a clear vision, we were a trusted candidate, and we commit to making Pizza Hut the pizza brand of choice among the Cambodian youth who prefer a modern lifestyle.

Where do you see Pizza Hut Cambodia in the next few years?

Although pizza is Western food, eating it in Cambodia is very common, especially among young people. UFG’s projections in 2019 suggested that the pizza market would generate at least $100 million in revenue in the Kingdom that year, with an annual growth rate of between 15 and 20 per cent.

We believe that Pizza Hut will be able to obtain a larger slice of the Cambodian pizza market, and we plan to open as many stores over the next three years as existing chains have in 15.

We aim to promote modern pizza eating culture in Cambodia, with the good quality of the original pizza brand.

How does Pizza Hut stack up against its industry peers?

Pizza is neither Cambodian nor ASEAN food, but a western meal. Pizza Hut is originally from the US, although there are many existing pizza brands from the ASEAN bloc.

Unlike its peers, Pizza Hut Cambodia has the superior advantage of best-practice sharing across the globe which enables us to innovate new products, deliver world-class food safety, and apply the best concept-store designs.

Pizza Hut has 18,703 restaurants in over 110 countries worldwide. You can imagine that if one new product were to be developed annually in each country, we’d have at least 110 new services and products that could enhance customers’ satisfaction.

We were the first brand to roll out “cheese bites” and “pan pizza”, and we’ll keep introducing new products, new tastes, new looks so our customers will experience world-class quality products that they’d never be able to taste at other chains.

In term of food safety, we source vegetables with Good Agricultural Practices (GAP) certificates, and only use water that is filtered and has been tested by the Institut Pasteur du Cambodge.

What does the brand’s debut mean for the market landscape?

For many pizza lovers, the arrival of Pizza Hut to Cambodia will provide a better choice, but it will also be a wake-up call for the competition to beware the legacy of the new brand.

Want it or not, our rivals will have to improve their services and quality to hold on to their slices of the market, because they wouldn’t want to be forced to accept thinner portions.
Hence the benefits will go to end-users.

Again, the original taste of world-class pizza has arrived, and it may very well be a nightmare for existing players.

This interview has been edited for length and clarity.

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