By Bernie Cahiles-Magkilat
Gone are the days when entrepreneurship was like the confines of the older, wiser and more seasoned people. This time, young and old alike are venturing into business may it be backyard, digital or just a simple garage-based endeavors.
With technology, the younger ones are getting more aggressive and smarter in the way they do business. They are also very creative and innovative in their thinking and in their approach to business.
Incorporated in 2016, Citrus Zone Group, Inc. (CZGI) was created to respond to the concept of healthy living. With the onset of fast food, and junk foods. Citrus Zone aims to promote healthier options by offering fresh, natural food selections.
The venture was made possible with three regular office workers from different companies as they network for their respective firms since 2011.
Joana Dalmacio, 30, a hotel management graduate is now in-charge of operations, and Claire Mosquera, 29, a food tech, now handles finance. Don came from a logistics company and is just 31 years old. They are pretty young and were just in their 20’s when they started the business.
As they developed friendships, they came up with an idea to go into business in 2015 focusing on healthy drink because they were also trying to lose weight. At that time, lemon water was the craze in town with everybody drinking water soaked with lemon from their own homes. Lemon water was served in every hotel and even pure water was served with lemon-scent.
“We asked ourselves why not make that our own as our side business, a sideline that most regular corporate employees do to augment meager salaries?” says Don. But they tweaked their offerings as they added additives like honey, cayenne pepper, mint, ginger, cucumber, tea-based apple cinnamon concentrates, among others. With an initial investment of P450,000 they were able to operate in Megamall and attained ROI in three months.
“The reception was very good, it clicked because the idea of lemonade latched onto people,” says Don. Lemonade had the connotation of being for the upscale and pricey, but they made it accessible and affordable.
They charge P15 per add on for the flavors. Their additives are mostly imported although some are locally sourced.
“People find it new, healthy and affordable because we have a basic drink for P39 only,” he adds. Citrus Zone serves their concoction hot when the weather is cold and cold during warm days.
At first, they tried local lemons but they were not suitable for juicing. So, they now import from 5 different locations worldwide – US, Australia, South Africa, Argentina and even Egypt.
Citrus Zone Refreshment envisions to promote healthier lifestyle by providing freshly-pressed lemon-based juices that are delicious, nutritious, affordable and accessible to all.
Given their popularity, the country’s biggest supermarkets and malls offer them spaces. Rental for a 4-sqm kiosk was P35,000 a month or 15 percent of sales, whichever is higher. It is lucrative for mall because there are times that Citrus Zone could pay as much P90,000 to P100,000 a month to the space retailer.
“So, the mall owner is very happy that they offer us space in every location they have,” adds Don.
With limited capital, the group decided to franchise, which was overwhelmingly received by their loyal customers. They launched the franchise in 2016.
Citrus Zone franchise is being offered for P290,000 for a kiosk, including a franchise fee, cart, training, equipment including juicer, and initial inventory.
If it is any indication that the lemon business is really going big time, Citrus Zone receives deliveries of 250 to 300 boxes of lemons a day. They are able to get it at lower price because they tap a consolidator, which sources lemons in a country when the fruit is in season.
“When we started we only had one competitor but they use sugar syrup and that sets us apart from them,” adds Don, who graduated magna cum laude with a Psychology degree from the Our Lady of Fatima University.
In just a matter of 3 years, Citrus Zone grew to a phenomenal 80 plus outlets nationwide in carts, kiosks and inline store formats. With the help of Francorp Philippines, the country’s premier institution in building corporate franchise systems, there are now more than 60 Citrus Zone franchise outlets.
Its flagship store is located in Megamall. Majority, or 90 percent, of the big outlets are in the malls. Its biggest outlet is a 15-square meter store in Southwoods, Binan.
Entrepreneurs are lining up because Citrus Zone has an average ROI of 7-9 months although most attained ROI in less than 7 months. They have 4 locations in Cebu and 3 in Iloilo.
Aside from Citrus Zone, the three friends are now introducing locally a new way of drinking orange fruit. The group has gotten a master franchise for Guri Guri. Established in 2014 in Japan, Guri Guri is a fresh concept that allows juicing fruits from the inside. No additives. No preservatives, just fresh orange fruit served fresh off the pulp!
With a specialized machine patented under Guri Guri, this unique juicing mechanism allows for a different fresh fruit beverage experience to clients around the globe. The juicing equipment is patented, hence it is protected from intellectual property infringers.
“So, it is hard to fabricate the equipment plus we believe in the value of the brand,” he adds.
Hailing from the Nagano Prefecture, Guri Guri is present in major cities and tourist spots in Japan. Since Guri Guri requires big seedless oranges, the group sources seedless oranges from Australia and Argentina.
Don said that when they saw Guri Guri in Japan they were attracted by its fresh concept of drinking oranges. “So, we bought the master franchise and now we have three stores in three malls in Metro Manila,” says Don.
“We want Filipinos to get the same experience in Japan, which now has 2,500 Guri Guri stores and people flock to them because they are very health conscious,” he adds. Profit-wise Guri Guri has better margins than the lemons because it is just pure orange no additives and economical, there is no other packaging, just the fruit itself.
Its franchise is good for three years and renewable thereafter at a much lower renewal fee.
One good thing about the fruit business is it is actually very environment friendly. “We actually sell the lemon skin in Divisoria and which in turn are used for fragrances and scents and some into tea,” says Don. Both drinks are using biodegradable straws only.
“More than that our drinks are a great source of vitamins and minerals. Lemon is full pack of Vitamin C minerals plus fiber,” says Don.
“Citrus and Guri Guri are of different concepts, but we are happy that we are experiencing the same success with our franchisees,” he adds.
There are also other fruits like Dragon Fruits that can be tapped for Guri Guri, not just oranges as they add more drink varieties. In addition, they have started offering bread sticks and regular bread toasts.
Notably, students and young professionals account for 60 percent of total customers although their drinks cater across A-D markets. They have also identified locations such as schools, office building and even fitness centers as good location for Citrus Zone and Guri Guri.
According to Don, when they started with Francorp they were only looking at 100 stores in five years, but they made 80 stores in just two years.
“That means we have to revisit our plan because there are many interested would be entrepreneurs queueing up for franchises,” says Don as they now look at 350 stores in five years.
The medium-term outlook also points to the opening of more inline stores and perhaps a full concept Citrus Zone and a full restaurant where they can bring all their brands together into a one stop shop for healthy drinks.
The prospect is even getting more exciting as more people are getting health conscious and the education department is ensuring that schools and nearby establishments do not sell sugary foods to students as they encourage healthier options for the young ones.
“We are bridging the gap by providing natural, healthy and affordable food,” says Don.
These three young entrepreneurs now directly employ 25 equally young people of 21-35 age range.
No, they don’t get workers from employment agencies although some office functions like accounting are being outsourced. Their payroll complement excludes those of their franchise stores. A store is manned by one or two people depending on size and traffic, but the malls must have two shifts.
“We don’t discriminate because these are simple skills, what we need are hardworking people, even our franchise supervisor is not a college graduate,” says Don, who also credits a store’s success to the staff. Don has encouraged his staff to own their tasks and the business because that is how a venture grows.
These young entrepreneurs do not micro manage. “We just give them the big picture, the standard operating procedure, and we want them to do well, so we do it together,” says Don stressing to his people that a staff just cannot remain a store crew forever. “We want to change their mindset by telling them that ‘if you’re going to be with us, you have to grow with us,’” says Don.
So, Don has pulled people from their comfort zones to do audits to ensure they are progressing in their work. At least 70 percent of their staff have not finished college but have been pushed to complete their studies while working with them.
This training and constant upskilling is in preparation for the company’s long-term goals as the triumvirate sees more potential for their partnerships to conquer new concepts.
The three friends love to travel together here and abroad where they explore and study new business concepts. Don’s free time is preoccupied with his master’s degree studies and his dog.
As a young manager, Don looks up to Jollibee as worth all the emulation for a successful Filipino brand. He also loves Potato Corner for making a name overseas.
As such, the three friends are not just looking at the local market, but believe they have a future overseas. Guri Guri has yet to make a full blast presence in the region and they are now in discussion with some inquiries from ASEAN countries.
“We have plans to go overseas for Guri Guri and perhaps Citrus Zone with possible partners,” says Don adding they also have inquiries from the Middle East although “we are treading very carefully because we don’t know halal.” Malaysia and Australia have also invited them to try its local market.
Don said there is still so much to learn and they will continue to lean on Francorp for guidance and to ensure they have legal cover.
Aside from getting free lemon and orange drinks, Don said they now live more comfortably than when they were yet mere corporate employees.
“We now call the shots and able to help people go into entrepreneurship through our very affordable franchise and we are happy with our franchises because they are really doing well and our customers are happy with us too,” he concludes.
The lemon business is going sweeter.
*this article was copied and originally published in Manila Bulletin last Oct 18, 2018 and can also be found at https://business.mb.com.ph/2018/10/16/young-entrepreneur-making-a-big-splash/