Aktiv Brands turns to private equity for growth

Aktiv Brands operators of Bucking Bull, se7en Gourmet Takeaway and Skewerz brands now have 43 stores across Australia. QSR Media found out what’s new for the group and how they are going to grow their different brands, when we caught up with their CEO Stuart Beechen.

QSR Media: What's been happening at Aktiv Brands over the last couple of years?
 

Beechen: We completed 10 years of franchise system development on the Bucking Bull brand

in 2009 with a total of 32 stores. The model has constantly been updated during this
period including the development of a new operating model in 2010. As a result of this
development work we have created a mature and profitable base for future growth.

This enabled us to add further brands to our business which utilise the same solid franchise
system.

The first of these is se7en Gourmet Takeaway which offers delicious gourmet takeaway
meals with style and value. Se7en’s brand value encompasses a passion for many things,
especially the environment and is delivered in a fun and cheeky way. After two years of
development, pilot stores for se7en were established in Queensland and West Australia in
2010-11.

The second of these is Skewerz which will focus on authentic Mediterranean cuisine
with fresh and exciting flavour profiles. This brand commenced in October 2010 with the
acquisition of The Kebab Co., a chain of nine stores based in West Australia.

QSR Media: What are the group's goals for the next 12 months?

Beechen: Over the next twelve months, Aktiv Brands will continue to grow the se7en Gourmet
Takeaway brand, focusing on expansion in both Queensland and Western Australia. We have
also identified Victoria as an area of potential growth, and hope to introduce a pilot store
within the next twelve months.

The focus on Skewerz will be in menu development and the conversion of The Kebab
Co. stores in West Australia to the Skewerz brand. We will also establish a pilot store in
Queensland.

Bucking Bull will see some store growth based on the new operating model where
opportunities are matched by realistic shopping centre rentals.

To enable this growth to occur we anticipate seeking private equity participation in the
business in the first half of 2012.

QSR Media :Where do you see the opportunities in the market?

Beechen: The QSR industry has a large number participants given the size of the market and will
undergo further rationalisation which will lead to more multi brand operators. We expect
to see smaller brands in the fast food market face difficulties in developing a sustainable
business model. This will provide us with opportunities to work with these groups.

QSR Media: Are there any other brands in the pipeline?

Beechen: Mergers or acquisition of existing brands is always a possibility where our franchise system
can add value to the brand but we plan to keep any totally new brand activity to 10% of our
total business. This is in order to minimise risk until the brand is developed past the pilot
stage and ready for profitable growth.

QSR Media: How do you measure the success of each of the brands under the Aktiv Brands umbrella?

Beechen: Because the fast food industry is one of the last affected by any economic downturn, it is
very resilient to changing economic times.

We measure our success by the profitability of our Franchise Owners. We have targets for all
KPI’s which are monitored weekly to manage and support each franchise business effectively
and minimise the risk of any franchise business closure. This system underpins our business
model for long term growth.

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Tags: Activ Brands, Stuart Beechen