The world's largest fast-food chain that serves Arab cuisine is not in the Middle East. It's in Brazil, and may soon be in the United States. It's called Habib's.
With 151 franchise restaurants in Brazil, Habib's outnumbers foreign rivals Pizza Hut, Burger King, Wendy's, Arby's, KFC and Subway, and comes second only to the 384 McDonald's outlets in the country. Habib's has recently opened its doors in Mexico, and it is now laying plans to offer its menu of familiar Lebanese dishes in the southwestern United States.
There is, however, no Mr. Habib. (The word means "friend" in Arabic.) There is Alberto Saraíva, MD, born in a small town in Portugal to a family that claims no Arab or Andalusian roots. When he was six months old, Saraíva's parents emigrated to Brazil, where his father became a traveling candy vendor in the state of Parana. As he grew up, Saraíva decided to become a doctor. But in his first year at the medical school of the prestigious Santa Casa de Misericordia de São Paulo, tragedy struck.
"My father had just opened a small bakery," recalled the entrepreneur, now 46. "One night, he was assaulted and killed by robbers. I was the oldest of three sons, and I had to support the family."
Saraíva stayed in medical school while also running the bakery. The experience, he says, led him to realize that he preferred business to medicine.
"After eight years, I finished my medical studies and entered the restaurant business," he says. "At first, we didn't have money to buy new equipment, so we bought used, but we opened our own restaurant." It was not long, he says, before he tripled his investment. "With this money, we built a second restaurant."
It was around that time, in the late 1980's, that Saraíva became friends with a Lebanese chef named Paulo Abud. From him, Saraíva learned a variety of Middle Eastern recipes, including the easy-to-prepare savory pastry called sfiha, a name that transmutes to esfiha in Portuguese-speaking Brazil. Sfihas are round flatbreads commonly topped with ground beef or cheese, tomato and chopped onions, and seasoned with spices and lemon juice. Saraíva also realized that Sao Paulo had only a handful of Arab restaurants amid an estimated four million residents of Arab descent— one of the largest Arab immigrant communities in Latin America—and he saw an opportunity.
"Among Brazil's 165 million citizens are some 12 million who are of Arab descent. I decided to create an Arab fast-food menu, aimed not only at the Arab immigrant colony but also at the Brazilian palate, with one extra ingredient: very low prices," says Saraíva. "This was an original idea. I didn't copy it from anyone else. Except for the Arab immigrants, nobody in Brazil had even heard of esfihas before."
In addition to esfihas, the 56-item Habib's menu includes such traditional Lebanese-Syrian staples as kibbe (egg-shaped cracked-wheat-and-lamb croquettes filled with spiced lamb and cracked wheat); kufta (spiced meatballs grilled on a skewer); warak 'aynab (stuffed grape leaves); hummus (ground chickpea dip) and tabouli (a salad of parsley, cracked wheat, mint and tomato). For the less adventurous, Habib's also offers hamburgers, chicken sandwiches, pizzas, french fries and, for dessert, ice cream.
"When we started, we didn't advertise," Saraiva says. "All we had was a sign saying 'Esfiha Habib's—The Best in São Paulo.' I had a friend who always called people 'habib', so when I told him I was starting a restaurant chain, he said, 'Why don't you call it Habib's?'"
Saraíva took that advice and, in 1988, with an investment of $80,000, he and his brother Belchior opened the first Habib's with 28 employees. For 45 days, he says, people stood in line to get in. The brothers quickly opened a second Habib's, then a third—and a chain was born.
Three years later, after inaugurating his 16th restaurant, Saraíva established a central kitchen in São Paulo so Habib's could consolidate its purchases and some of its food preparation. Today, that kitchen processes 1800 tons of meat annually that go into some 220 million esfihas served at 73 Habib's in metropolitan Sao Paulo, 19 in the interior of Sao Paulo state and 20 in Rio de Janeiro. (The rest of the restaurants are in other major Brazilian cities: Curitiba, Florianópolis, Fortaleza, Goiánia, Recife and Uberlândia.) Altogether the eateries employ some 7000 people, and they ring up combined annual sales of $200 million—of which Saraíva says approximately $40 million is profit. Saraíva claims the market value of his company is roughly $600 million.
Now Habib's is no longer the only Arab fast-food chain in Brazil: There are Casa de Esfiha, Mister Sheik and several others, all of which contend for the market opened by Habib's, but Saraiva's chain remains the most popular and successful.
"Since the first Habib's, we've applied the philosophy of very low prices," Saraíva says, noting that the foods on his menu are cheap to produce and therefore can be sold at rock-bottom prices. An esfiha at Habib's, for example, costs less than one-third as much as a simple McDonald's hamburger and less than half as much as either a hot dog or a pao de quejo ("cheese bread"), two popular foods often sold by street vendors.
Confident that Habib's could appeal beyond Brazil, Saraíva inaugurated his first outlet in Mexico City last March, where customers can buy esfihas for the equivalent of 19 cents—the same price as in Sao Paulo. Over the next six years, he plans to open Mexico's first Arab-food chain with 220 restaurants in the three largest metropolitan areas: Mexico City, Monterrey and Guadalajara.
"This expansion in Mexico will be very important," he says. "Here we have a chance of being number one."
His next move, which Saraíva says is contingent on success in Mexico, would be to continue north into the United States, where he is already negotiating a joint-venture restaurant with Wal-Mart that would open next year in Los Angeles. "It won't be difficult to sell our most important products there," he believes.
Expansion to other US cities would follow, and in doing that Habib's would follow a trail blazed by such other foreign chains as the Mexican El Polio Loco, which has sprouted nearly 300 us franchises, and the Filipino Jollibee's, for whose pineapple-topped hamburgers Angelenos have queued up out the doors in scenes that could have been from Habib's during its early days in São Paulo.
But for now, Saraíva 's hopes are pinned on Mexico. He points to market research showing that Mexicans are more likely to eat breakfast away from home than Brazilians—and Habib's, as it happens, offers an extensive breakfast menu. Saraíva and his director of expansion, José Mauro Magon, spent much of the early part of this year scouting hundreds of potential Mexican locations, putting in 15-hour, 400-kilometer (240-mi) days with frequent stops to make notes and meet with local entrepreneurs, real estate agents and officials.
That schedule leaves Saraíva little time to spend with his three children or enjoy his apartment in Mexico City's upscale Las Lomas neighborhood, where he and his wife Claudia plan to spend the next year. But Saraíva is ambitious.
"Our final big objective is the United States, because in the US, even though there's competition, everybody will want to be a franchisee," says the one-time doctor. "This has always been a dream of mine. If it were just for the money, I would have stopped a long time ago."
Larry Luxner is a Wahington-based free-lance writer and photographer who specializes in Latin America and the Middle East. He can be reached at larrv@luxner.com.
