The business has been run by daughter Michelle since 2013 but John Ho is well aware of all the steps the company has taken; in particular that first day, when Macau opened its first McDonald’s restaurant.
Speaking to Macau Business, the entrepreneur wryly recalls “the naysayers regarding our first store opening. I can’t remember which publication it was back then, but basically the message was that McDonald’s would fail within three months. The reason being Macau’s long lunch breaks. Most people in Macau took 3-hour lunch breaks to get together with and eat with their families and even take a nap to make it a siesta, so Macau does not need fast food,” they said.
On the other hand, John Ho, Chairman Emeritus of McDonald’s Macau, also remembers the days before: “We had a crew family night two days before opening where we invited the McDonald’s crew members’ families to attend, at which their parents could see the environment in which their children were working. Of course, during that evening all food, beverages, and desserts were on the house, free of charge and there were long lines at every counter.
“I distinctly remember the facial expressions of two young brothers as they carried a single tray [of McDonald’s food] with one hand on either side as they made their way as a team up the long staircase to try and find empty seats to sit down to eat. Their smiles of utter satisfaction when they reached the top of the staircase was one of the biggest and brightest I have witnessed – and it was priceless.”
The first McDonald’s opened on 11th April, 1987 on Rua do Campo. Almost two years after (1st May, 1991) it would be the turn of Avenida Horta e Costa to host the second restaurant. “We opened 10 stores in our first 10 years of business (1987-1997). There are currently 29 McDonald’s stores in Macau, and we expect to grow to at least 31 stores by the end of 2017,” explains Michelle Ho, second of John Ho’s daughters and CEO of the three companies.
“We expanded to Zhuhai in 1996 as the opportunity presented itself from McDonald’s Corporation. They were looking to expand the McDonald’s China business (the first store opened in Shenzhen on 8th October, 1990) and turned to existing and nearby developmental licensees within the McDonald’s system to help grow the business. Due to its proximity to Macau, Zhuhai was a natural choice for us especially since we had an established business set up already,” continues Michelle. In 2014, they went to Zongshan. “We had 39 stores in Macau and Zhuhai when I returned to Macau in 2013. We acquired the Zhongshan market in 2014 and currently have 78 stores in total. We also employ over 3,000 team members across the three markets.”
Including the first and original employee: “We are fortunate to still have him with us after 30 years,” says Michelle. “Our total office support and leadership team in Macau consists of 48 people, over 20 team members of whom have served for more than 20 years, which is rare for businesses in Macau.”
Macau, Zhuhai and Zongshan
Michelle Ho assumes there are natural differences between the primary market and the expansion destinies. “The brand connection customers have is somewhat different in Macau versus Zhuhai and Zhongshan. We are fortunate in Macau that the Golden Arches shine very bright as the Western quick service restaurant (WQSR) industry is quite limited and we have a dominant position. The frequency of McDonald’s in Macau is also higher than in Zhuhai and Zhongshan. There are a lot more WQSR and Chinese quick service restaurant choices in China – plus the spending power and cost of living is different in China versus Macau. Both are competitive markets in their own right.”
And so they want to continue to grow. In Macau and in the two cities where they also hold the franchise. “We continue to expand our business in Macau and believe there is still more room to grow even though we are a tiny little landlocked [region]. Our territory of Zhuhai and Zhongshan is about 100 times the size of Macau so there’s a lot of opportunity in the longer term for future expansion, especially with the infrastructure development in those two cities.”
So, what are the secrets of those 30 years? Michelle Ho opts to highlight the people who work with them: “While we are in the food service industry, I really consider McDonald’s to be a people business. Our people are our biggest asset. Our crew, managers, baristas and Customer Service Ambassadors serve and delight our customers 24/7, 365 days a year. They really help make that moment of truth come to life at our stores, delivering on the McDonald’s promise of outstanding Quality, Service, Cleanliness and Value (QSC+V).”
For him, John Ho feels the concerns of today are the same as 30 years ago. He confided to Macau Business: “I was not so much concerned that this first one restaurant would not do well. With 300,000+ Macau citizens and one restaurant, how can you go wrong? I was more concerned how we, with this one team, could deliver consistent QSC+V yet train up another team capable of delivering the same standard for a second restaurant. And also, where would that second location be so that it would not drastically impact the first restaurant once it opened.”
This year, Mcdonald’s China sold its business to Citic conglomerate. Will the Zhuhai and Zongshan stores be affected? Michelle Ho says no: “McDonald’s China and Hong Kong sold 80% of its business to Citic Capital and Carlyle. That sale does not affect its franchised stores, of which we have 48 stores combined in Zhuhai and Zhongshan currently. Citic Capital and Carlyle are new strategic partners and we embrace them and all that they will bring to the business.”
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[Head/part 2]
Celebrating 30 years
“We are planning a few activities to engage the Macau public in celebrating our big birthday,” says Michelle Ho. “The first is our McDonald’s Macau 30th Anniversary Memories Playland at the Macau Science Center, from 8th April until 7th May, 2017. We will have on display many nostalgic items that include Happy Meal toys, premiums and artwork from the past 30 years, along with the McDonald’s iconic characters Ronald McDonald, Grimace, Birdie and Hamburglar, all woven into an interactive Macau landscape.”
The McDonald’s Macau CEO adds that “Playland is open to the public to visit for free and all proceeds from the sale of special limited edition premiums at our Memories Playland will go towards supporting a meaningful cause in Macau. This year, we are happy to support the Concordia School for Special Education. There are a few more surprises to come and they surely won’t disappoint, so stay tuned!”
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[HEAD/part3]
Water means money…
John Ho shares with Macau Business a “humorous little known fact before the first store opening which has everything to do with feng shui.”
“Prior to 11th April 1987, unbeknownst to a lot of people now living in Macau, you could actually park your car on Rua do Campo in a herringbone formation in front of the first McDonalds. Several days before the opening there was a tremendous downpour and my little prized possession, a Toyota Corolla, was completely flooded all the way up to the top of the wheels. Later that evening, when I was ready to drive home, I unlocked the car and opened the door only to have water gush out from the inside. Needless to say, the interior of the car was completely destroyed – but I actually didn’t fret over it too much as I was told later that water means money and it just kept pouring in.”
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Macau-Minneapolis-Macau
John Ho, born and raised in Macau, founded McDonald’s Macau together with his wife Mary more than 30 years ago.
He left the former Portuguese enclave in 1966 to continue his high school and higher education in Minneapolis, USA. Between 1973 and 1981, he was involved in the semi-conductor industries in Minneapolis. John earned a Bachelor and a Master degree both in Electrical Engineering from the University of Minnesota.
In 1982, John and his wife – already with their oldest daughter- moved back to Macau and in 1985 he signed with McDonald’s Corp to become the developmental licensee for the Macau market.
Married to his wife Mary for over 30 years, he has four daughters, Jacqueline, Michelle (invited by the father, Michelle returned to Macau in 2012 and is running the business), Jillian and Martinique, and one grandson. John’s hobbies include photography, golf and travel. He is also an avid supporter of the Ronald McDonald House Charities and Special Olympics Macau Golf International.
Now is the Chairman Emeritus of McDonald’s Macau.
