64-year-old chicken noodle and Thai food shop 'Mae Sri Ruean' has weathered every major crisis. How did it turn the game around to survive?
In the restaurant industry, which has a large number of entrepreneurs, if we talk about brands that have been with Thai society for a long time, and have fallen and faced major crises many times, but have always been able to turn the game around and come back to prominence every time, and have also admirably evolved with the times, one of them that is worthy of being used as a case study is'Mae Sri Ruean Chicken Noodle Shop'Which has been around for 64 years until now it has become a 500 million baht noodle and Thai food shop!!'Mr. Chan Rueangrung'The second generation executive who has been through 5 major crises of Mae Sri Ruean brands in every era will be the one to tell us the story of success and reveal the secret to overcoming the crisis for us to listen to. Mr. Chan Ruangrung, Executive Director of Krua Mae Sri Ruean Co., Ltd.
From grandma's small noodle shop to a family business that currently has over 37 branches.
The first branch of Mae Sri Ruean was founded in Central Pattaya in 1961 by Chan's grandmother. At that time, there was an economic crisis and rice was expensive. Field Marshal P. Pibulsongkram announced his vision for Thai people to eat noodles instead of rice with curry. Chan's grandmother therefore started to invent a shredded chicken tom yum noodle recipe. At that time, it was sold for only 6 salung per bowl. Mae Sri Ruean's famous Tom Yum Chicken Noodle recipe for over 64 years
“My grandmother was the first person to make chicken noodles with a tom yum recipe by adding crushed peanuts and roasted chili powder. If it was dry noodles, she would squeeze some fresh lime juice into it, turning it into dry noodles with spicy sauce. If it was tom yum, she would season it to have a well-rounded three-flavor taste. At that time, Mr. Paiboon Butkhan composed the song ‘Mae Sri Ruean’ for Chan Yen Kaew to sing, and it became very popular. My grandmother, whose name was ‘Aun Ruean’, liked the song and saw that it was similar to her name, so she named the shop Mae Sri Ruean Chicken Noodles since around 1954.”
With its delicious taste, the reputation of Mae Sri Ruen Chicken Noodles has spread by word of mouth, making anyone who visits a tourist city like Pattaya have to come and try it, leading to the saying that “If you don’t eat Mae Sri Ruen Noodles, it’s like you didn’t come to Pattaya.” So, Chan’s family saw an opportunity to expand the branch to open in Bangkok.
“I joined Mae Sri Ruen Chicken Noodle Shop in 1971, when it was still a small shop. We opened our first branch in Bangkok in 1978, when a bowl of noodles cost 7 baht. We’ve been through 4-5 major crises, but we’ve always managed to turn things around every time.” From a small shop in Pattaya, it is now a restaurant brand with 37 branches.
The First Crisis: Lessons from Branch Expansion
“The first crisis was in 1984. At that time, our Lad Phrao branch was selling very well. Every holiday, the parking lot was full of customers. But we never imagined that one day, Lad Phrao Road would have heavy traffic and parking on the side of the road would be prohibited. Our daily sales of ten thousand baht disappeared, leaving less than 3,000 baht. From this lesson, we learned that other branches that we would open must have locations with parking.This first crisis taught us that when the environment changes one day, if we don’t think ahead about what will happen in the future and wait until a crisis occurs to solve it, it may be difficult. ”
After the first crisis of the Lad Phrao branch, Mae Sri Ruen Chicken Noodles expanded to many branches, such as Ram Intra, Imperial, and Srinakarin.The main point of business expansion, in addition to location, is to control taste, quality, and standards to be the same in every shop, as well as manage costs to be as efficient as possible.
The second crisis: the Tom Yum Kung crisis
“That crisis was very serious. At that time, we had about 4 branches. We never imagined that we would borrow money from the bank with an interest rate of 17.5 percent to expand our business. At that time, we probably didn’t have much experience in calculating costs and didn’t think about what obstacles or unexpected events would arise once we invested and decided to move forward. Then in 1997, the Tom Yum Kung economic crisis occurred. Sales dropped from 100 percent to less than 20 percent.
This made us decide to sell all of our assets, including the building on Srinakarin, to clear all debts and interest. It took about 5 years to clear all debts.That crisis taught us that in doing business, we must not forget about risk management because every business has risks that can occur at any time.”
Crisis 3: Bird Flu
The next crisis occurred several years later, in 2004, when the bird flu outbreak hit Mae Sri Ruen's noodles, which use chicken as the main ingredient. However, Mae Sri Ruen's efforts to adapt and overcome the crisis led to growth and new market opportunities for the future.
“At that time, we never thought that selling chicken noodles during the bird flu outbreak would cause all customers to disappear. Believe it or not, we barely made any sales for almost 6 months. That incident made us need to learn more about the menu so that customers would have more choices when it comes to eating.
We learned about Thai food menus from various culinary institutes and then adapted the recipes into the unique taste of 'Mae Sri Ruean'.When we had a wider variety of menus, we were able to get through the crisis. And the side effect was that we didn’t only have chicken noodles. We didn’t limit ourselves to just a chicken noodle shop anymore. People started to know Mae Sri Ruen as a Thai restaurant more. ”
In 2011, a major flood hit several provinces, including Bangkok. Mae Sri Ruean, which at that time had several branches in the outer eastern part of Bangkok, was also affected, with 7 branches having to temporarily close. Branches in areas that were not flooded also experienced a drop in sales because people did not come out to spend money.
“At that time, all we could do was to sustain the business and wait until the water receded and the situation returned to normal.It was at this point that I began to see the benefits of the central kitchen that had been in place for some time. When Mae Sri Ruen expanded to its 7th branch, we began to think that we should have a ‘central kitchen’ to prepare ingredients, sauces, curry pastes, etc. to be delivered to the various branches. This would not only make it easier for each branch to cook, but it would also save manpower in each branch and help control standards as well. ”
Crisis 5: COVID-19
“Crisis is the nature of the world… it will happen all the time.”
Chan commented that the COVID-19 crisis that has occurred around the world this time is the most severe crisis since Mae Sri Ruen was born and grew up. He likened it to a 'World War III' that has continued for a long time until now. But one thing that has allowed Mae Sri Ruen to 'narrowly' survive is her foresight. The brand has already started adapting to do delivery 3-4 years ago.
“If Mae Sri Ruean hadn’t started delivering before COVID-19, we might have collapsed by now. Because of the ‘sunk cost’ or the cost that we have to pay as a restaurant, even if you don’t do anything, there will always be expenses, such as rent and employees that we have to take care of, which are expenses that we have had to bear for almost 2 years.
But when the COVID crisis happened, we tried to adapt and sell through delivery channels more seriously until we were able to maintain the numbers to a certain level, allowing us to overcome the crisis. We didn't expect that when we first started doing delivery about 3-4 years ago, we had very few sales, only about 5 percent of total sales.But now, with the latest wave of COVID, our delivery sales have grown by about 40-50 percent.”
The key to success and 'overcoming crises' from the 'good housewife'
Find a way and do it. It will always make us find 'luck'. If we sit still and do nothing, luck will never come to us.
Walk the right wayTake a path that will make your business and life more prosperous. If so, then you are on the right track.
Creating a story that the world will remember, such as the story of Mae Sri Ruean’s origins and impressive taste, is another important key to success. Ask yourself, “Does your restaurant have a story like this today?”
See opportunities rather than crises.In the world of travel, business and life, we should view crises as a path we will have to face. But don't focus on crises or see everything as a problem. There is always an opportunity.Like the COVID crisis that happened, in another way, it is an opportunity for us to learn and find ways to adapt, whether it is adjusting sales on delivery platforms, managing methods to keep the taste of the food the same when selling delivery, and developing new products that meet the needs of current customers.Every crisis is an opportunity for us to develop and learn.
Take good care of peopleAlthough Mae Sri Ruen has a central kitchen, we don’t operate like a factory. To produce skilled cooks like Mae Sri Ruen, we need to use ‘soft skills’. It’s not easy to train people, so we need to maintain our human resources well.
Simply delicious, the second dish of a Thai family. A mission to make Thai food known around the world.
One of the outstanding products that Mae Sri Ruen is currently marketing is probably 'instant soup', which seems to be a bright future for 'Mae Sri Ruen' because it meets the needs of the market and consumers in this New Normal era very well.
“Actually, this is not a new project. It’s been like this since we had a central kitchen that made various curries and sauces, such as Pad Thai sauce, Kaprao sauce, and Stir-fried Chicken sauce, and distributed them to each branch. Each branch had to add vegetables, ingredients, fish, shrimp, chicken, pork, etc. to each menu. Actually, we had the idea of making ready-made products like this since 2001-2002. But since we were still having fun expanding our branches, we didn’t really focus on developing this seriously.
Until the COVID crisis happened, we saw this as an opportunity because people had to stay home more. With Mae Sri Ruen’s long experience, we were able to develop products very quickly. We immediately released more than 10 menus at the same time, such as various types of Thai curry, which can be cooked with ingredients for only a few minutes and taste as good as eating at Mae Sri Ruen’s restaurant.”
Up until now, Mae Sri Ruen has a variety of ready-to-eat Thai curry products, such as sour curry, green curry, tom som curry, panang curry, fish entrail curry, yellow curry, liang curry, etc. In addition, there are many ready-to-eat food products and packaged ingredients, such as massaman curry, fish entrail curry, southern curry paste stir-fried pork, stir-fried chicken with curry paste, green curry, chicken panang, pork teppo curry, original khanom krok flour, riceberry khanom krok flour, etc.
Mae Sri Ruean uses her expertise in Thai food to develop a variety of ready-to-eat Thai curry products and ready-to-eat meals.
These products are born from a vision
Want to be a leader in developing Thai food to be distributed around the world.
I believe that anyone in the world can cook Thai food as deliciously as a professional Thai chef.
9 million households worldwide will have Thai food or Thai curry paste in their kitchens within 10 years.
Thai restaurants around the world, even though the owners are foreigners, use products and ingredients from Thailand.
Easy to cook, delicious like eating at the restaurant, meeting the needs of the New Normal era.
Target customer groups of Mae Sri Ruean products
People who are passionate about the diverse flavors of Thai food and are tired of the same old tastes.
Family group, housewife
Customer groups living in condominiums or apartments
General restaurant operators who are business owners
coffee shop
Boutique hotel and golf course group
“With our long experience and being a true expert in Thai food for over 60 years, we aim to push Thai food to become a Thai culture that exists in the world. The whole world must know Thailand through its food culture within 10 years.”
With all the aforementioned visions, both seeing crises as something normal that will happen all the time, looking ahead, not focusing on just problems, but always trying to find 'opportunities' in every crisis, it is certain that no matter how many more crises occur, 'Mae Sri Ruean' will likely remain with Thai society for a long time.
