By Arra B. Francia, Senior Reporter

MAX’S GROUP, Inc. (MGI) is spending about P1 billion for a new manufacturing and distribution center in Cavite to support its store expansion in the following years.

The listed casual dining restaurant operator said it has started the construction of the No Bia Food Manufacturing and Distribution Center in Carmona, Cavite last year, with completion targeted by 2020.

“It allows us support for our expansion post-2020. If we didn’t have that then it would be hard for us to really expand,” MGI Chief Finance Officer Dave T. Fuentebella told reporters in a briefing after the company’s annual shareholders’ meeting in Quezon City yesterday.

The company said it has a total of nine commissaries, three of which are used for production manufacturing while the rest are for warehousing.

“It’s really future proofing MGI towards the support of our expanding force and also getting into more efficiencies because the plant was designed to handle lines, whereas at present we don’t have that capacity,” Mr. Fuentebella added.

The facility will service the needs of MGI’s brands, including Max’s Restaurant, Pancake House, Yellow Cab Pizza, Krispy Kreme, Jamba Juice, Max’s Corner Bakery, Teriyaki Boy, Dencio’s, and Sizzlin’ Steak, among others.

MGI President Robert F. Trota said they will be spending over P600 million in capital expenditures this year, bulk of which will be used to support the expansion of its commissaries.

Meanwhile, MGI has scheduled to open 80 new stores this year, only 20 of which will be company-owned to support its plan to have more franchised outlets by 2022.

Mr. Trota said the goal is to switch the ratio of company-owned to franchised stores to 30% to 70%, against the current ratio of 60% to 40%.

“As we pivoted to franchise, we are keeping the quality stores that we want, the ones with better returns on investment. That’s why if you see our growth in profitability, this shows that it was the right move,” Mr. Trota said in the same briefing.

If realized, the company will be opening more stores than the 66 it rolled out in 2018, bringing the firm’s network count to 705 by the end of 2018.

“We continue with our growth agenda for MGI, we’re building on momentum that we’ve established last year. We continue to operate efficiently, so that quarter one numbers are quite positive for the group,” MGI Chief Operating Officer Ariel P. Fermin said in the same briefing.

Shares in MGI slumped 0.82% or 12 centavos to close at P14.48 each at the stock exchange on Thursday.