Mie Gacoan Success: Navigating Controversy and Low Prices

Mie Gacoan's success lies in affordable pricing, strategic branding, cross-subsidy, operational excellence, and tapping into Indonesia's massive staple food market.

### The Success Story of Mie Gacoan: Selling Noodles for 10,000 Rupiahs and Generating Trillions in Revenue
* 🍜 Mie Gacoan, a popular Indonesian noodle chain, has managed to achieve significant success by selling noodles for as **low as 10,000 rupiahs** and reportedly generating **trillions in revenue**.
* 🥇 Despite not being the first in the market, Mie Gacoan has successfully positioned itself as the **number one spicy noodle brand in Indonesia**, surpassing its predecessor Mie Kober which has been around since 2010.
* 💰 The key to Mie Gacoan's success lies in its **strategic branding, operational excellence, cross-subsidy model, and timing**. By offering **affordable prices and a comfortable dining experience**, they have managed to attract a **large customer base**.
* 📈 With 132 branches as of the latest data, Mie Gacoan has become a market leader in the East Java, Central Java, and Bali regions, tapping into **Indonesia's massive instant noodle consumption market**.
* 🏭 The chain's success is also attributed to its **operational efficiency and economies of scale**, allowing them to maintain **low prices** while still achieving a profit margin of **40-50%**.
* 🌶 Mie Gacoan's entry into the spicy food market in Indonesia, one of the **top 10 countries for spicy food consumption**, further solidifies its market fit as a **staple F&B business**.
* 🕰 Despite controversies and challenges, such as delayed halal certification and operational issues, **Mie Gacoan's ability to consistently deliver on its value proposition** will be crucial for its future growth and sustainability.
* 🔮 The case of Mie Gacoan serves as a valuable lesson that being the **first in the market is not always necessary for success**, as long as the **execution and market fit are strong**.

How can selling noodles for 10,000 rupiahs generate trillions in revenue? In my opinion, the phenomenon of Mie Gacoan is truly unique. I even uploaded it on Tiktok, Shorts - the views reached millions. And I found some interesting facts. This is just one of the businesses that I find difficult to research. Because there isn't too much public data to dissect the business model and financials of Mie Gacoan. What's even more amazing is if you try to find out about Mie Gacoan, why is there so much controversy around it? Do you remember the case of the worm that went viral? Then there was a case where a food delivery driver lined up at one branch and was surrounded by the employees of Mie Gacoan, the next day the drivers came in groups to that branch. There was even a branch that had to close because its exhaust machine was too loud. Plus, why did it take them so long to get halal certification? The controversies are actually the easiest to find online. And one thing I found out, they are actually the number one Spicy Noodle in Indonesia, but not the first one, in fact. In my opinion, they are quite similar to their competitors. Let's discuss their success first. According to several articles, Mie Gacoan mentioned that the high-performing branches could make up to 100 million per day. If you

If multiplied by 12 months, it's Rp3.6 trillion. But that calculation is really stupid. Because it's impossible for all branches to reach that amount. Even if a margin of error is included, for example, per branch 50 million — plus earlier I used 100 branches, whereas the latest data in November 2023 shows there are 130 branches. Still, according to this person, the noodle business with a price of 10,000 rupiahs can generate trillions in revenue. So, what's the secret? Why is Mie Gacoan so successful? The interesting part is actually the story behind it. The origin of why Mie Gacoan was born and why this word — in my opinion, quite sharp. Chapter 1: Pioneer, Not a Follower. I once saw a comment, 'This business is a copycat.' Then I was curious, a copy of what? Mie Gacoan has been around for a long time, since 2016. That's 8 years. But it turns out there's a spicy noodle business that was opened in 2010, called Mie Kober. Even if you visit their website, there's a hashtag #PioneerNotFollower. It seems to indirectly target some brands. And the founder, Aris Ardiansyah, his nickname, opened Mie Kober in 2010. 6 years before Mie Gacoan existed.

The origin of spicy noodles was that they modified the typical noodles from Malang. And you will be surprised, the menu sold by Mie Kober is called Devil Noodles, Angel Noodles, Satan Noodles. The names are exactly the same as Gacoan Noodles before they had to change it due to halal certification issues. In terms of price point, they also sell around Rp9,500 - 10,500. Besides spicy noodles, they also have dim sum, siomay, sushi, chicken feet, spring rolls. And they didn't actually die. Up to now, in July 2023, there are 30 branches in Java, Bali—including a production house and warehouse. Now, fast forward to 2016, suddenly their competitor emerged, Gacoan Noodles. Gaco is Javanese for champion. Its subsidiary is PT Pesta Pora Abadi. If you do a lot of googling, you will find that there are 3 founders. But everyone mistakenly thinks that Haris Kristanto owns it. From Solo. However, he is the HRD of Gacoan Noodles. On his Instagram, there is a note in his bio, Not the owner of Gacoan Noodles. If I'm not mistaken. The actual CEO and founder is Anton Kurniawan. But Mr. Haris still played a role in building the Gacoan Noodles brand. Initially, there were three of

But the first branch was in Kediri. But when they started, it wasn't actually Mie Gacoan. It had gone through several rebranding processes. Initially, they sold Mie Nelongso—that was their product. But the place where you eat is called Warunk Gacoan. And at that time, their focus was on various noodle soup menu variants. During the 2016 era, there were Mie Gacoan Kare, and also Mie Gacoan Tomyam. Back then, the price was still Rp7,000 - 8,000. Until now, they finally have 132 branches, rebranded the name to Mie Gacoan, with more than 3,000 employees, and their vision is to become the number 1 restaurant chain in Indonesia. Where is their focus? Yes, on affordable prices. When you buy food there, you get food and an experience that exceeds the value you pay for. The question is, why is Mie Gacoan more well-known than Mie Kober even though Mie Kober has been around since 2010—with the same menu name, the same side dishes, and the same cheap prices? And is it really profitable to sell at such low prices? Could it be that their revenue is in the trillions, but their profit margin is very thin? Those are interesting questions. Before discussing the analysis, let's move on to Chapter 2,

Fast or not according to me is relative. But if judged by how many branches, their latest data shows they have 132 branches. And if you visit their website, they have claimed to be the market leader. Especially in the East Java, Central Java, and Bali regions. But when they say they are number 1, in my opinion, that is one of their strategies, why they can have such a large market share. When we talk about F&B business, actually, it falls into these three things that the business must deliver. The food is delicious, the price is right, the place is comfortable, and the service is good. There are actually 4. And how can Mie Gacoan check all these 4 things? If you dissect their menu—this is if you come offline—almost all their menu items are priced below Rp10,000. Then, some ask again, if they sell food that cheap, where do they profit from? Opening a place is not cheap actually. If you look at each branch, there is consistency, the place is always comfortable, quite spacious, and the parking is also ample. Sometimes, they are mistaken as a parking business because their parking spaces are always full. And they are one of the food places that if you look or order through online motorcycle taxis—both me and my editor often order from them—it always takes a long time because the queue is very long.

So what's the secret sauce actually? And maybe here I can discuss from 4 angles. Branding, operations, cross-subsidy, and timing. Let's start with branding first. Is this similar to the story of Android and Apple? The very first one to pioneer the smartphone OS was actually Android. They could be called the pioneers. The case here is Mie Kober. But what is perceived by consumers or the public, the number one is Mie Gacoan. When they started labeling themselves as the Number 1 Spicy Noodles in Indonesia, that's actually one way to brainwash you. You don't actually need to be the pioneer. You don't need to be the first, but what's important is always being perceived as number one in terms of consumer choice. And they keep pushing this number one, even on their private website. They always say number one here and will continue to strive to be number one nationally. And their branding is unique. Every time a customer comes and labels Mie Gacoan, there is never a slow day at the Mie Gacoan outlet. The parking lot is always full, and in the end, there is always a long queue. In my opinion, the name matters. And the way they repeatedly say they are number one, in my opinion, is clever. The second one, the cross-sell/cross-subsidy system. Because they still want to advance their US which is cheaper or more

Or for example, a complete dish with all the fillings, priced at 20,000. They can break down the menu until everything is below 10,000. What makes people come back is, Wow, it's so cheap to eat here. But again, actually, it's quite risky because sometimes selling items individually like that is not profitable for the business. Honestly, if you come and just buy one noodle, sit for an hour, it's detrimental to the business. It doesn't cover the costs. And in my opinion, strategies like this, the core product is the noodles - the profit margin is not that high. But the question is, who really comes to buy just the noodles? Because with the perception of it being cheap, have you ever been trapped into, 'Okay, this is cheap, I'll add something else'? Actually, side dishes, beverages have better margins. Rarely do people come just to buy the noodles. Based on their reports, they can have a profit margin of 40-50%. In simpler terms, for example, if you buy food priced at Rp10,000, the cost is only Rp5,000. That includes ingredients and cooking. So by breaking it down like this, they establish an affordable branding, but still designed in a way that customers will still order other side dishes.

Thirdly, operational excellence and economic soft skills. Excellence and economies of scale. If you want to run a business with a very low selling price, especially in the F&B industry, you need what is called economies of scale. So, the more branches, the more orders, the more people, the cheaper the ingredients. And maybe a case like that happened with Mie Gacoan. At the beginning, they didn't get the most efficient cost price to make a thick profit for their business. But as they continued to expand, taking the gamble of setting low prices at the beginning, the volume increased, more customers came, and eventually, the prices could be continuously reduced. And I've seen many comments—not just about the volume, but they have quite a well-organized system. The fact that they dared to do it. One thing I saw on Twitter, for example, if an order doesn't arrive within 18 minutes, they give a free siomay package. Now, I don't know how it is now, maybe you can comment below. And this is the last part, timing. They started in 2016. More modern than Mie Kober. And if you notice, it actually went viral around 2019-2020. Because during those moments, which were quite fresh from the opening of Mie Gacoan, they were quick to collaborate with online food delivery services like GoFood, GrabFood, or ShopeeFood.

And in 2019-2020, it can be said that the new businesses launching were quite lively—if the concept is unique and easy to talk about from the customer's perspective, it can reach word of mouth much more efficiently. But actually, besides those four, you also need to understand when starting any business, and if you want to see how big this business will be in the future, you also need to consider its external components. Let me just conclude in Chapter 3 about Mie Conglomeration. Mie Gacoan actually enters a market that truly defines Indonesia. When talking about how big the market is, usually at Sevenpreneur, we first look at the market sizing. Market sizing or the potential size of your business is calculated based on trends and consumer behavior. And in Indonesia, a fun fact, it is the second largest consumer of instant noodles in the world. Only behind China/Hong Kong. Where other countries below, if you look at the numbers, are far behind. Not to mention they entered the spicy food market. Yes, Indonesia is in the top 10 countries for spicy food consumption. Plus, tapping into the socio-economic aspect, because with prices starting from Rp10,000, from lower to middle class—almost the majority of the Indonesian population can go there and enjoy the food every day. So, to understand the life cycle of an F&B business,

Actually, personally, I categorize them into two. Is this an F&B business that is seasonal or staple? So, most of the trendy F&B businesses you see, it seems like their concepts are quite new. Maybe they have risen, fallen, and maybe some have stayed until now. For example, like cromboloni, Milo ice ball, ice cream—even though it's cheap, for example, like Mixue. That falls into the seasonal business category because it doesn't match its market. When we talk about ice cream, actually, our per capita dairy consumption in Indonesia is low. So, it cannot yet be considered a food that people are comfortable with and can eat every day. That's why when Mixue was on the rise before, now it seems a bit quieter compared to their early hype. And not all F&B businesses can get through the phase after their hype; they still maintain that market. Because to be categorized as a staple market, again, you have to look at the consumers in that country. When we talk about noodles, spicy ones—similar to the market for fried chicken, fried rice—that is truly staple or the daily needs of Indonesians ready to be eaten every day. And looking at its formula, in my opinion, Mie Gacoan checks all the boxes. Socio-economics that are massive—consumers for staple foods, namely noodles and spicy dishes. The next question is if they want to expand significantly.

Basically, can they maintain their consistency? It all goes back to the key, operational excellence. Each branch must consistently follow through. They can maintain their relevance. If suddenly a new competitor emerges, Mie Kober suddenly innovates in their new menu, and does not slip in issues they cannot recover from brand damage, and perhaps scandals that make people suddenly lose trust in their brand. What is quite unique and interesting to me is why did they only receive the halal certification in 2022 when they have been operating since 2016? It turns out that when they went back and forth from the names of their menus, Mie Setan, Mie Angel, Mie Iblis - those were not accepted by MUI. Finally, they changed their menu to Mie Hompimpa and Mie Suit. Even though they are in the right market and have become a staple in Indonesia, looking at controversies like in order to maintain their low prices, they really have to think about reducing costs in terms of employees, etc. And this is a disclaimer, many of these rumors are not actually confirmed. Like what I see in the comments of netizens saying their employees are paid below average, even below the regional minimum wage. Not to mention the issue of the always crowded Gojek queues. There are many complaints from there. But yes, so far in my opinion, they handle it well. Even like - if those motorcycle taxi drivers are crowded.

They were given free siomay from Mie Gacoan. That's in some cases. So along the way, the more branches, the more there are— up to 1000, up to international expansion— again, actually these are questions that the answers will only be seen later. Can they still be consistent? Can they avoid operational blunders? But so far, what they offer now, in my opinion, is quite a market-fit product in Indonesia. It's already big and extensive, and they have managed to tap into that market. It's not easy actually. Because the bigger it gets, the tougher the competition. But, we'll see. Because to be honest, it's quite interesting, right? Selling noodles for 10,000 but the revenue can reach trillions. If the expansion continues, maybe above 10 trillion, above 20 trillion—we'll never know. But that's the lesson according to me from Mie Gacoan. You don't need to be the first to do something unique, as long as the execution is good. What do you think? I guess I'll see you guys in the next video, bye.

Belajar Strategi MIE GACOAN, Mie Pedas Nomor 1 di Indonesia?

Raymond Chin

The Success and Controversies of Mie Gacoan Noodle Business

Mie Gacoan noodle business has achieved tremendous revenue, with some high-performing branches reportedly making up to 100 million rupiahs per day.

The brand has faced various controversies, including a viral case of a worm found in the noodles, loud exhaust noise leading to the closure of a branch, and challenges in obtaining halal certification.

Despite being accused of being a copycat, Mie Gacoan is positioned as a pioneer in the spicy noodle business, differentiating itself from competitors.

The Evolution of Spicy Noodle Brands in Indonesia

Mie Kober originated the spicy noodles from Malang, later rebranded their menu due to halal certification issues, and now has 30 branches in Java and Bali.

Gacoan Noodles, with rebranding and a focus on affordable prices, has grown to 132 branches and aims to be the top restaurant chain in Indonesia, surpassing Mie Kober's popularity.

The reasons for Mie Gacoan's greater success despite similar menus and low prices raise questions about its profitability and revenue.

Mie Gacoan has 132 branches and is self-proclaimed as the market leader in East Java, Central Java, and Bali.

They have achieved a large market share through affordable pricing, comfortable locations, and efficient branding strategies.

The key to their success lies in effective branding, operations, cross-subsidy, and timing, allowing them to be perceived as the number one choice for consumers nationally.

Mie Gacoan's Business Strategy and Success

Mie Gacoan uses a strategy of offering affordable noodles to attract customers, while making higher profits from side dishes and beverages.

The business relies on operational excellence and economies of scale to maintain low prices while increasing their customer base.

By starting with low prices and expanding rapidly, they were able to reduce costs and increase volume, leading to their success.

The Success of Mie Gacoan in the Indonesian Food Market

Mie Gacoan has found success in the Indonesian food market by tapping into the country's love for instant noodles and spicy food, which are staple daily foods for the majority of the population.

The restaurant's affordable prices also make it accessible to the lower and middle class, further contributing to its widespread popularity.

Unlike seasonal F&B businesses, Mie Gacoan's concept aligns with the daily needs of Indonesian consumers, positioning it for significant expansion in the future.

Maintaining Consistency and Overcoming Controversies: The Story of Mie Gacoan

Mie Gacoan's success relies on operational excellence and maintaining relevance in the market.

The restaurant faced challenges with menu names and controversy over halal certification, but has managed to handle them well so far.

As the business expands, the key questions remain about consistency and avoiding operational blunders, but their market-fit product and successful tapping into the Indonesian market position them for continued success.