, Indonesia
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Hendy Setiyono, Founder and CEO of Baba Rafi Enterprise.

Baba Rafi's ‘attack’ strategy in multi-brand F&B transformation

The company now houses various F&B brands in 1,500 outlets.

When the COVID-19 pandemic hit, Indonesian operator Baba Rafi staged a two-pronged ‘attack’ strategy to survive the difficult times. As of today, that strategy has played to their advantage, with the company having various F&B brands in 1,500 outlets.

The name Baba Rafi was originally associated with a franchise brand, namely Kebab Turki Baba Rafi. Starting with only two outlets in 2003, now the brand is able to spread not only in Indonesia but in countries such as Malaysia, Singapore, Philippines, India, China and the Netherlands. Even under Baba Rafi Enterprise, the company also operates various F&B brands by collaborating with other SMEs to scale up.

"Our vision is to grow together, recover together, win together, similar to the G20 slogan. There are our businesses that were launched as a result of collaborations such as Menantea which is my business collaboration, Foresthree Coffee with the owner of Kopi Soe who is a fellow player in the coffee sector," said Founder and CEO of Baba Rafi Enterprise, Hendy Setiyono to QSR Media.

The F&B brands under Baba Rafi Enterprise include Menantea which is a fusion tea brand and currently has 208 outlets after one year of opening, then there is Ngikan which sells various fish creation menus, Nyapii which serves culinary beef, and Kumaw Ramen which sells ramen noodle.

Hendy revealed that he continued to use an attack strategy to survive even in difficult times such as when the COVID-19 pandemic hit when restaurant operations were limited. The attack strategy is carried out by continuing to innovate both from the menu side and from the partnership side.

Innovation of menu and partnerships

From the menu side, Baba Rafi Enterprise updates by issuing a new menu every two months or a maximum of once every three months. In 2022, Kebab Turki Baba Rafi launched the Kebab Sei Sapi menu with a gold prize of 0.01 grams in each package to celebrate the 19th anniversary of the establishment of the kebab franchise chain. Menantea issued a Korean Tea Series menu to capture the love of generation Z and Indonesian millennials for K-pop. Then,  Nyapii also issued a Korean Spicy menu.

However, these intensely emerging innovations are not without challenges. Hendy does not deny that not all new products will be well received by the market. "But if we don't launch new product innovations, the brand will sink further. So we have to keep reminding consumers of new products through social media, which is currently still the key to spreading awareness," he said.

Continuing to remind consumers of new products, said Hendy, can still have a positive impact on the brand. Because, even though consumers don't directly buy new products, they can buy old products that they like with this reminder.

Meanwhile, from a partnership perspective, Baba Rafi Enterprise offers an autopilot franchise concept. This concept allows franchises to be managed centrally so that they are more standardized and partners do not need to be involved in their business activities. "This is an innovation for partners who have an interest in becoming entrepreneurs but are still busy with their other activities," said Hendy.

Through this concept, the partner franchise business will be managed directly by the principal with better standardization. "Partners can receive dividends or profit sharing every month," he added.

This autopilot franchise concept is implemented in three brands under the Baba Rafi Enterprise, namely Kebab Turki Baba Rafi, Menantea, and Kumaw Ramen. "We provide these three brands with an autopilot franchise option as a solution so that partners who do not yet have a prospective location, we can help them by finding the right location until the operational business is prepared and until it opens or runs," he said. Partners are asked to prepare capital starting from $4.968k to $16.562k (IDR75m to IDR250m).

Improve consumer experience

One of Baba Rafi Enterprise's strategies to improve consumer experience is to partner with influencers as Brand Ambassadors and business partners. "So apart from being Brand Ambassadors, they (influencers) are also active in providing advice in matters related to business because they are the owners or shareholders of the brand," said Hendy.

In Menantea, the company partners with YouTuber and social media star Jerome Polin. “So consumers who are also fans of Jerome can indirectly meet their idol through Menantea products. When they buy Menantea products, they post and mention Jerome. There is a certain pride for consumers when their posts are reposted and noticed by their idols," he explained.

Baba Rafi Enterprise also continues to strive to maintain the quality and taste of the products presented so that they don't become a one-time purchase. This maintained quality is carried out by establishing Management Control, a simple system, as well as ongoing training so that operations at each outlet can run according to standards.

The company also tries to present promos in facing market challenges that are still price-oriented. "Especially because our target market is generation Z and millennials, whose tastes change quite quickly and loyalties shift easily," he said.

The promos given follow the promos available at merchants such as Go Food, Grab Food and Shopee Food food delivery services. Then the promo was held by Baba Rafi Enterprise with the concept of cross-subsidies. “So we do this concept seasonally and offline. By providing promos for products with thin margins, the hope is that when consumers come to the store to buy, these consumers will also see other products, namely old and favourite products that provide high margins," he said.

With these strategies, Baba Rafi Enterprise is optimistic that it will have a bigger expansion in the future. The company plans to conduct an IPO on the stock exchange this year. "Hopefully after our IPO plan, our number of outlets can double from the current achievement of 1,500 outlets and we can become one of Indonesia's proud F&B brands," he concluded.

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