When Jinduk Seo started making sauces in his kitchen, he never meant to create a global brand. But as he moved from experimenting at home to selling his sauces on baked chicken at a college campus in South Korea, he realised he might be on to something. So, he began to manufacture the sauces in 2002.
In 2006, he was approached by someone doing Korean fried chicken in the US who wanted to use the sauces. That was an ‘aha’ moment. He partnered with them and from there the idea took off.
He named the business Bonchon, which means “my hometown” in Korean. Fourteen years later, Bonchon has 347 locations, with 103 in the US and the rest across the Philippines, Thailand, Singapore, Cambodia, Kuwait, Myanmar and Vietnam.
The restaurant centres around Korean fried chicken; double fried chicken (wings, drumsticks or strips) brushed with one of its signature sauces – spicy, soy or sweet crunch. The menus are complimented by other Asian-inspired specialities – such as bibimbap, Korean tacos and pork buns, although that varies by location.
All the sauces are still made in its global kitchen in South Korea, but there are no Bonchon restaurants in South Korea. This is by design. South Korea is saturated with fried chicken spots, so it made more sense to introduce the craze in places familiar with this style of fried chicken, but not inundated with locations on every corner.
CEO Flynn Dekker joined the company about two years ago, when the business was sold to a private equity firm. He had been with a competitor, Wingstop, and was looking for a new challenge. He had always admired the food at Bonchon and called it his “best kept secret” when he took friends to the New York City location. The brand has slowly been gaining traction in popularity as the team adds more locations.
Seo is still involved as both a shareholder and board member. He serves as the chief quality officer as well. “He still has lots to say about the product and stays true to cooking method and sauces,” says Dekker.
Patchwork plan
“The original growth strategy was really patchwork,” says Dekker. “We had lots of open locations, but no real density.” Some of these locations fell in areas with Asian populations already familiar with its cuisine. Others were just because franchisees wanted to open in that particular location.
The first US location of Bonchon opened in 2006 in Fort Lee, New Jersey, which has a large South Korean ex-pat community. There was also little consistency across the board when it came to menus. The signature Korean fried chicken was always the marquee dish, but many locations added regional dishes to appease its customers.
The biggest inconsistencies were in design and operations. “Restaurants in the Philippines have opted for the fast-casual model, while Thailand has chosen a more upscale route,” says Dekker. The US landed somewhere in between, with most locations as quick-serve, sit-down establishments.
The next phase of growth is focused on consistency and more of a hub and spoke model versus the former, more random approach. Currently there are only two corporate owned locations in the US, with the vast majority being franchise locations. For all other countries there is a master franchise agreement with one single franchisor in each of those countries.
Dekker would like to see a few more corporate-owned locations with a smaller footprint, so the brand can start testing out different concepts over the next few years. The thought was to build a more fastcasual model across locations and, prior to Covid-19, the company was also exploring the possibility of adding ghost kitchens.
Having studied the markets, the Bonchon team has found that its food resonates across all ages and ethnicities, not just in Asian-dense populations. This information opens up many more locations for them to be successful.
Globally, the focus is currently on marketing, branding framework and signage. Back in the US, Bonchon will start to introduce new design elements and try to work on consistency across menu items.
The goal, says Dekker (pictured): “is to make sure we are presenting a consistent picture and menu and offering to all customers, so they know exactly what they can expect.”
Dealing with the pandemic
Part of the plan was always to develop carry-out and delivery, and the team had been actively looking for ways to lower costs and innovate in that space. So, when the Covid-19 pandemic forced restaurants around the world to shutter their dining rooms, Bonchon was already positioned to pivot quickly.
Deliveries are currently made through Postmates, Grubhub, DoorDash and UberEats, but the team is working on an app so that customers can order from any location through the Bonchon website, with white label delivering so it can save money across locations.
Some locations had previously embraced take-out, while others had not. But the virus changed that. “We gave a clear message – you must do this to survive,” says Dekker, after which everyone jumped on the delivery and carryout bandwagon quickly.
Although many of the dining rooms remain closed or at limited capacity, the company has been able to regain prepandemic level sales through delivery and carryout alone.
“We focused our marketing efforts on free delivery promotions through third party delivery platforms and doubled our digital advertising,” says Dekker. It was an effort that proved to be successful.
The virus also caused the company to pause and take a look at its safety measures. Some restaurants implemented plexiglass for their carryout windows. All restaurants increased sanitation, switching to disposable menus and adding safety strips to carryout and delivery orders, so guests know their food hasn’t been tampered with.
Because it hasn’t experienced a great negative financial impact from the pandemic, giving back to those in the restaurant industry became a top priority for Bonchon. It launched a “Heart & Soles” campaign with clothing company Threadless, creating fried chicken themed shoes, socks and masks, with 100% of the proceeds going to support the National Restaurant Association Educational Foundation (NRAEF) Restaurant Employee Relief Fund, to help others in need.
“What we’ve tried to instil in this organisation is a sense of empathy and the thought that we are all in this together,” says Dekker. “We started by making sure that everyone in corporate kept their job, we gave bonuses to corporate restaurant workers that still wanted to work and provided royalty deferrals to our franchises.”
Future plans
The company feels fortunate to carry no debt at this time and, even in the middle of a pandemic, Bonchon is still planning to grow. Last year it grew 20% and its original goal was to do the same this year. Some of the locations were already under construction pre-Covid-19 and, if possible, will open this year – although some cities are struggling to get the proper permits.
“The situation is impacting different countries at different times,” says Dekker. “We are still pretty optimistic – it will really depend on the back half of the year.”
Bonchon is still able to import from South Korea, but is keeping a close eye on borders and potential supply chain issues.
For now, there’s a focus on redefining the brand. “We are thinking about what makes us special and what remains unique to Bonchon, says Dekker. “We’ve had lots of success and high growth, but now is the time to shape that.” That includes new technology that can be implemented across stores for carryout and delivery, new menus and new design that will help make the business be more congruent.
The growth goals remain aggressive as Bonchon plans an additional 500 locations in the US over the next seven years, but the company knows this may change. “We are realistic that this virus will determine what Bonchon will look like in the next two to three years,” says Dekker.
Samantha Lande
