A 64-Year-Old Chicken Noodle and Thai Cuisine Restaurant, Mae Sri Ruen, Has Been Through Every Major Crisis. How Did They Change the Game to Survive?
Sep 29, 2021
In the restaurant industry, the number of entrepreneurs is countless. However, if you’re thinking of brands that have been with the Thai society for a long time, have faced and struggled through several major crises, but were able to change the game and come out the winners every time as well as possess admirable contemporary innovations, one of them that’s worth considering as a case study is Chicken Noodle à la Mae Sri Ruen which has been operating for 64 years and has become a noodle and Thai cuisine restaurant worth 500 million baht!!
Mr. Chan Rueangrung, second-generation manager, who was there through all five major crises for Mae Sri Ruen, will share their success story and reveal the secrets to overcoming crises with us.
From Grandma’s Little Noodle Shop to a Family Business with up to 37 Branches
The original branch of Mae Sri Ruen in Pattaya Klang was established in 1961 by Mr. Chan’s grandmother. At the time, the economy was bad, so Field Marshal P. Phibunsongkhram announced his vision of Thai people eating noodles instead of rice and curry. That’s when Mr. Chan’s grandmother invented a recipe for tom yum noodles with shredded chicken, selling for only six salueng per bowl at the time.
“My grandmother was the first to make tom yum chicken noodles. She also added ground peanuts and ground roasted chili. She’d add a squeeze of fresh lime to make dry tom yum noodles. For tom yum, she’d season it to create three flavors. At the time, Mr. Phaibun Butkhan had written a song called ‘Mae Sri Ruean’ for Chan Yenkhae to sing and it was really popular. My grandmother’s name was Unruean. She liked the song and thought the name of the song sounded like her name, so she named the noodle shop ‘Chicken Noodle à la Mae Sri Ruen’ sometime in 1954.”
With the famously delicious flavors, the popularity of Chicken Noodle à la Mae Sri Ruen spread from mouth-to-mouth. Anyone visiting a tourist destination like Pattaya had to give it a try, giving rise to the saying, “If you don’t eat Mae Sri Ruen’s noodles, you haven’t been to Pattaya.” Mr. Chan’s family recognized this as an opportunity to expand and open branches in Bangkok.
“I started helping out at the Chicken Noodle à la Mae Sri Ruen in 1971. It was just a small shop then. We opened the first branch in Bangkok in 1978. Each bowl cost only 7 baht. We’ve been though 4-5 major crises, but always found a way to turn the situation around and recover.”
Crisis 1: A Lesson from Expansion
“Our first crisis was in 1984. Back then, our Lad Phrao branch was very successful. Customers’ cars would park to full capacity every holiday. However, we never thought that Lad Phrao Road would one day have so much traffic that parking at the side of the road wouldn’t be allowed. The daily sales dropped from 10,000 baht to less than 3,000 baht. This lesson taught us that we needed parking space for future branches. This very first crisis helped us learn that the environment would one day change. If we didn’t think ahead, but waited instead for the crisis to happen to fix it, we’d be in a pickle.”
After the first crisis at Lad Phrao, Chicken Noodle à la Mae Sri Ruen opened several new branches, namely the Ramintra, Imperial and Srinagarind branches. The key to expanding the business, other than the important subject of location, is maintaining the flavors, quality and standard to be the same at every branch as well as managing the cost to be as efficient as possible.
Crisis 2: Tom Yum Kung Crisis
“This crisis was a bad one. We had about four branches at the time. We never could’ve imagined it when we took out a bank loan with a very high interest of 17.5 percent to expand our business. We didn’t have much experience with expense and cost calculation at the time, and didn’t think we’d encounter obstacles or unexpected events when deciding to move forward. Then in 1997, the Tom Yum Kung financial crisis happened. Our sales dropped from 100 percent to less than 20 percent.
This led to our decision to sell our remaining assets, even a building in Srinagarind, to clear our debts and interests. It took us five years to clear all our debts. This crisis taught us to never forget risk management when doing business because every business has risks that can occur at any time.”
Crisis 3: Avian Flu
The next crisis happened years later. In 2004, there was an outbreak of avian flu. This had a direct impact on Chicken Noodle à la Mae Sri Ruen, which uses chicken as its main ingredient. However, Mae Sri Ruen’s attempts to adapt and overcome crises brought growth and new marketing opportunities for the future.
“Back then, we just couldn’t believe that customers would all disappear from our chicken noodle restaurants after the avian flu outbreak. Could you believe it? We barely sold anything for almost six months. That event forced us to learn how to make new menu items, so customers would have other dishes to choose from.
We studied Thai cuisine from culinary institutes and adapted the recipes to create Mae Sri Ruen’s own unique flavors. Once we had a more diversified menu, it got us through the crisis. One byproduct of the crisis is that we don’t have just chicken noodles anymore. We’re not limiting ourselves to being just a chicken noodle restaurant. More people started to know Mae Sri Ruen as a Thai cuisine restaurant.”
Crisis 4: Severe Flooding
In 2011, severe flooding occurred in several provinces, including Bangkok, causing Mae Sri Ruen, which had several branches operating in the eastern outer perimeter of Bangkok at the time, to temporarily close up to seven branches. In addition, the branches that were not in flooded zones suffered a drop in sales, because people weren’t coming out to buy.
“At the time, all we could do was support the business and wait for the water to recede and the situation to return to normal. That’s when I started to realize the benefit of having a central kitchen, which we’ve been doing for a while now. When Mae Sri Ruen opened its seventh branch, we started to think that we should have a central kitchen for preparing ingredients, sauces, soups, etc., for delivery to the branches, because it’d not only help each branch to prepare the food more conveniently, but would also help save on labor and control our standards.”
Crisis 5: Covid-19
“Crises are natural…They’ll always be around.”
Mr. Chan commented that this Covid-19 global pandemic crisis is the most severe crisis since Mae Sri Ruen was established and expanded. He compared it to a WWIII that has been going on for a long time to date. However, the thing that allowed Mae Sri Ruen to narrowly escape its fate is thinking ahead. The brand started doing deliveries 3-4 years ago.
“If Mae Sri Ruen hadn’t started selling via delivery before Covid, we might be bankrupt now because of the sunk costs involved in restaurant businesses. Even if you don’t do anything at all, there’ll always be expenses like rental fees and employee salaries for you to handle. These are the expenses we’ve been burdened with for the past two years.
Nevertheless, when Covid came, we tried to take delivery sales more seriously until we were able to maintain a certain level of sales. That’s what helped us overcome the crisis. We never could’ve imagined it. When we first starting offering delivery services 3-4 years ago, the sales were very low, only about 5 percent of the total sales. Now, the delivery sales have grown to about 40-50 percent.”
Mae Sri Ruen’s Key to Success and Overcoming Crises
• Walk in the right direction. Walk toward the direction that will bring your business and life more prosperity. If that’s what you find, then you’re going in the right direction. • Create a story the world will remember. For example, Mae Sri Ruen’s impressive history and flavors are keys to success. Ask yourself today, “Does my restaurant have a story like that?” • Recognize an opportunity rather than a crisis. In the world of travel, business and life, see a crisis as a path you already have to face but don’t focus on the crisis or see everything as a problem. There is usually an opportunity. Take Covid for example. From another perspective, it’s a chance for you to learn. Find a way to adapt, whether by selling through delivery platforms, finding ways to manage and maintain your flavors when you have to sell through delivery, and developing new products to meet current customer demands. In every crisis, there’s an opportunity for you to develop and learn. • Take good care of your employees. Although Mae Sri Ruen has a central kitchen, we don’t do everything like a factory. To train a skilled person to cook like Mae Sri Ruen, we need soft skills. It’s not easy to train each person. That’s why we have to preserve our human resources.
Simple Deliciousness, the Second Meal Set…for Thai Families. The Mission to Make Thai Cuisine Known Worldwide.
One of Mae Sri Ruen’s outstanding products that we’re marketing right now is ready-to-eat curries, which seems like a bright future for Mae Sri Ruen because they perfectly meet the demands of the market and consumers in the new normal era.
“Truthfully, this is not an entirely new project. Since we have a central kitchen that makes curries and sauces like phat thai sauce, kaprao sauce and khua kai sauce and, and distributes them, each branch is tasked with adding vegetables, ingredients, fish, shrimp, chicken pork, etc., to each dish. Actually, we’ve had the idea to make ready-to-eat products since 2001-2002, but, we didn’t seriously focus on developing the products since we were still having fun with expanding the branches
When the Covid crisis happened, we viewed it as an opportunity since people had to stay home more. With Mae Sri Ruen’s experience, we’re able to produce the products very quickly. We produce over 10 menu items at a time, namely, Thai curries. All you have to do is add a few ingredients, which takes a few minutes and you can enjoy the kind of flavors you get at any Mae Sri Ruen restaurant.”
Now Mae Sri Ruen’s producing a variety of ready-to-eat Thai curries, namely, Gaeng Som Soup, Green Curry Soup, Sweet and Sour Soup, Panang Curry Soup, Southern-Style Spicy Fish Soup, Sour Yellow Soup, Gaeng Liang Soup, etc. Moreover, they also produce numerous ready-to-eat food products and packaged ingredients, for example, Massaman Curry, Southern-Style Spicy Fish Soup, Stir-Fried Minced Pork with Southern Curry Paste, Khua Kling (Chicken), Stir-Fried Chicken with Green Curry Paste, Chicken Panang Curry, Kaeng Tae-Po (Pork), Original Thai Traditional Style Sweet Baked Rice Cake Mix, Riceberry Thai Traditional Style Sweet Baked Rice Cake Mix, etc.
All of the products are created from the following visions:
• The desire to be a leader in Thai cuisine development and global distribution. • The belief that anyone in this world can make Thai food as deliciously as a professional Thai cook. • Nine million households worldwide will have Thai food or Thai curry ingredients in their kitchens within 10 years. • Thai restaurants worldwide, even those owned by foreigners, will use products and ingredients from Thailand. • Meals can be prepared easily and taste like you’re eating at a restaurant, meeting the demands of the new normal era.
Target customer groups for Mae Sri Ruen’s products:
• People who are captivated by Thai cuisine’s diverse flavors and bored with the same old flavors. • Families and housewives. • Customers living in condominiums and apartments. • Owners of regular private restaurants. • Coffee shops. • Boutique hotels and golf courses.
“With our long-standing experience and status as true experts in Thai cuisine for over 60 years, our goal is to push for Thai cuisine to be the Thai culture that stays with this world. This entire world must know Thailand through its food culture within 10 years.”
With all of the previously mentioned visions and the fact that we see crises as normal occurrences that can happen at any time, we look ahead, not focusing on only the problem, but always trying to find opportunities in the crises. We truly believe that, no matter how many crises, we have to face, Mae Sri Ruen will stay with Thai Society for a long time.