Shakey’s Pizza Asia Ventures, Inc. (SPAVI), the Po family’s restaurant and kiosk operator, is not letting a good crisis go to waste as the company is treating the current environment as a stress test to streamline operations—including closing underperforming stores—to prepare for growth once the market recovers.

During the firm’s annual stockholders’ meeting, SPAVI Chairman Christopher T. Po said consumer spending on restaurant food has taken successive hits due to a recent flood control corruption scandal and geopolitical tensions in the Middle East. However, he noted that their kiosk businesses, particularly Potato Corner, continue to grow as consumers view them as an affordable indulgence.

“Now, we're almost six months into the new year. We are, as a company, seeing flattish same-store sales growth with all the different brands combined. And, again, it's very pronounced. The restaurant brands are showing flattish, even slightly negative same-store sales growth. But the kiosks, which are really more value for money, more affordable, are still showing high single-digit same-store sales growth,” Po said.

In light of this, SPAVI President Vicente Gregorio said, “We need to learn from these lessons and continue to find ways to become more fit. We need to take stock and take advantage of the challenges and the tough times to streamline and be more efficient. We want to make sure we come out of this stronger.”

Consequently, Gregorio said there will be a rationalization of SPAVI’s store network, allowing the firm to review its organization and implement initiatives to lower overhead costs.

“So, we are really taking this as an opportunity—not letting a good crisis go to waste—and restructuring, closing underperforming stores, and streamlining our corporate support offices, etc. This way, when the crisis is over, we would have completed the streamlining and our margins can return to what they were before. And so, we look forward to better days,” Po said.

While the company continues to expand its footprint by opening new locations—even reaching a milestone of 3,000 stores earlier this year—SPAVI will simultaneously be closing underperforming outlets.

“So far, we've closed between 15 to 20 stores year-to-date and are still observing a few more,” Po said. Gregorio added, “Shakey's has fewer closures. There'll be a few more in Peri-Peri. But we're also looking at everything, including Potato Corner, to see if there is any opportunity where we can relocate or restructure.”

Meanwhile, despite higher utility and transport costs, Po noted that they will implement measured price hikes.

“Our price increases have been quite measured. If we look at the inflation numbers that came out the last two months, you're talking 6.5 percent, 7 percent, 6.8 percent; our price increases are significantly lower than that. In fact, they are in the low single digits because we understand the need to provide our guests with value,” Po explained.

Ultimately, the company is focusing heavily on improving efficiency and cutting costs internally so as not to pass the entirety of these higher expenses onto its customers.