Food for thought

My grandfather was an Italian chef who came to South Africa in the sixties and joined the impressive line-up of brilliant cooks at the illustrious Carlton Hotel in the Johannesburg CBD in Commissioner Street. After a few years, he went to Port Elizabeth and started one of the first Italian restaurants there and his son, my uncle Nilo, carried on the tradition by running Bella Napoli restaurant for over 25 years, which is virtually unheard of nowadays, as the statistics show that 90% of all independently owned restaurants fail within the first five years of their existence. To what did they owe their success? It’s actually pretty basic: they were the first to arrive and the last to go home, the food was consistently good because they sourced good produce and their staff was well trained, well paid and happy in their jobs. My Uncle had the gift of the gab and was a jovial and friendly host together with his wife Maria, and they welcomed their guests as they would welcome family into their home. But with the passage of time, new trends in the form of restaurant franchises started to become more popular and offered opportunities to entrepreneurs wanting to start their own business. It must be said that franchising has contributed greatly to South Africa’s economy. Even in tough economic times, people still have to eat.

So the concept of food franchises is quite well established in South Africa and a couple of factors make us stand out from the international crowd: the first is that about 90% of our brands are locally developed, e.g. Steers and Nandos, and this was out of necessity, because in the 70s and 80s when franchising started to take root, trade sanctions forced many South Africans to come up with their own ideas instead of depending on the international brands. The second is that the Franchise Association of Southern Africa (FASA) kept their members in the know regarding overseas trends and developments. Their role is to define franchising and to ensure that all franchises stick to the franchise business principles accepted all over the world. FASA also promotes the advantages of franchising to entrepreneurs as well as the public at large. So what is the secret to having a successful franchise business?

For the most part, franchising is not an easy opportunity to get rich in a short space of time. It requires the franchisee to be hard-working, confident, able to interact with people on all levels, able to handle challenges and conflicts and comfortable with risk-taking as well as being confined to the franchisor’s rules and restrictions. To top it all, Kobus Oosthuizen, former chairman of FASA and publisher of Franchise Warehouse said in a recent interview in the Sunday Times Newspaper (Sept 25 2011) that high rentals were the biggest threat to small retailed businesses. In addition, the shocking high cost of electricity is currently causing some franchisers to restructure their business models. Having mentioned all this, people however still need to eat, irrespective of the downturn in the economy and FASA maintains that the more established brands have managed to maintain their performance. Most people are still eating out, but are choosing the food franchises instead of the pricier, upmarket restaurants.

From a consumer’s point of view, I know that I definitely have more than a couple of favourite franchise restaurants that I revisit time and time again, like the Mugg & Bean in Killarney, Johannesburg, who make the best On The Go Breakfast ever and at under R30! Or the Col’Cacchio restaurant at the BluBird Centre in Atholl, my family’s Friday evening spot and one of the best pizzerias in town. The reasons why we are loyal to certain franchises are simple: consistent commitment to standards, from the food, to the service to the managerial presence.

Innovation is also a factor: The MacDonald’s brand has survived through booms and recessions only because of its Madonna-like tendency to recreate itself. After receiving bad press regarding the unhealthy aspect of the food served, it was one of the first franchise restaurants to post nutritional information about its menu and now offers healthier options in addition to the usual bill of fare. But concept can be left in the hands of the franchisor. It is up to the franchisee to make a success of his business by emphasising his dedication to the brand by producing good food, serving it with a smile and being a hands-on manager.

 More on franchises: www.butlermagazine.co.za