Boost juice competitive advantage strategy

ASIAN CASE RESEARCH JOURNAL, VOL. 18, ISSUE 1, 175–197 (2014)

© 2014 by World Scientific Publishing Co. DOI: 10.1142/S0218927514500072

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This case was prepared by Dr. Jane L. Menzies and Professor Stuart C. Orr of Deakin University, Australia, as a basis for classroom dis- cussion rather than to il- lustrate either effective or ineffective handling of an administrative situation.

Please address all correspon- dence to Dr. Jane L. Menzies, Deakin Graduate School of Business, Deakin University, 221 Burwood Hwy, Burwood, VIC 3125, Australia. E-mail: jane.menzies@deakin.edu.au

Internationalization of Boost juice to Malaysia

IntroductIon

Janine Allis, the founder and managing director of Boost Juice, sat in her Melbourne-based head office, at Chadstone “The Fashion Capital”1, and pondered the achievements made by Boost Juice in Malaysia. Since 2009, Boost Juice has opened 11 stores, with exciting plans for two more stores in the not too distant future.2 By 2014, a total of 30 stores are planned for opening. She wondered, would the economic fall-out from the European debt crisis have an effect on her Malaysian plans? Was the choice of Master Franchisees the right deci- sion for Boost Juice in Malaysia, and has the process of inter- nationalization for Boost Juice in Malaysia been successful thus far?

Background

Walk into a Boost Juice outlet and you will hear the music pumping, see the staff bopping to the rhythm of making you a fruit juice and you will understand what is meant by the “customer experience” at Boost Juice3; it’s fun, loud and designed to develop a unique relationship with customers.

The Boost Juice Company commenced operations in Adelaide, South Australia, in 2000; established and run by the entrepreneur, Janine Allis, who wanted to bring healthy fruit juices to Australia.4 Allis was aware of the popularity of juice bars across the globe. She had visited many juice bars in

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the United States where the industry was much more devel- oped than in most other countries.5 Allis built the organi- sation up from its modest beginnings in the Melbourne suburbs where she started mixing up some “wicked juice and smoothie blends” in her own garage, she then opened her first retail outlet in Adelaide in 2000.6 In 2004, Janine Allis was awarded Telstra’s Businesswoman of the Year award for her entrepreneurialism.7 Since then, Boost Juice has become an incredible franchising success story and, accordingly, has been awarded a multitude of awards in the Australian business community.8

By 2005, Boost Juice had expanded to 180 retail juice outlets across Australia and its brand awareness had risen to 94%.9 Allis’s success in the Australian market (see Exhibit 1) provided her with much of the motivation to internationalize to other countries and Malaysia. Since 2004, Boost Juice has embarked on an international expansion program and, in 2012, now operates over 240 retail outlets in 15 countries, plus Australia.10 Boost Juice’s turnover was approximately A$135m in 2011.11 In 2007, Boost Juice acquired a majority holding in the Australian Mexican Food chain, Salsa.12 Then, in 2010, Boost Juice sold a majority stake to a US private equity company, The Riverside Company, for A$65m.13 The purpose of this was to raise the much-needed capital to finance Boost Juice’s further international expansion plans. See Figure 1 for Boost Juice’s development timeline.

Boost Juice entered Malaysia in 2009, with its first retail outlet in Suria, Kuala Lumpur (see Exhibit 2). By 2012, it had expanded to 11 retail outlets (mainly located in the Klang Valley, with one in Penang at Gurney Plaza)14. Locational decisions made by Boost Juice are usually based on sound research, foot-traffic, and demographic analysis.15 All Boost Juice outlets in Malaysia have been established in high-end shopping centres. These locations were selected because the

Fig. 1. Boost Juice Company Development Timeline.

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