RFG on their Mining town strategy
QSR Media talks to RFG's Faith Manning, National Sales and Leasing Coordination Manager, about their mining town strategy.
QSR Media: Are there any brands in your portfolio you are favouring over others for this expansion?
Faith: For the expansion of RFG brands, there are some mining towns where there is an obvious need for particular brands over others, depending on the town. In particular brands such as Brumby’s Bakeries and Michel’s Patisserie are popular due to the lack of existing retailers. Sales figures for new stores in these areas have been exceeding expectations, for example the new Michel’s Patisserie in Canelands Shopping Centre in Mackay achieved great results in its first weeks of trade.
QSR Media: Have you picked out any specific sites in these towns?
Faith: RFG is at different stages of site identification and leasing, depending on the individual towns. As a general rule though, RFG has identified potential sites across all its brands for the next 12 to 18 months, including those in mining towns.
QSR Media: Tell us a bit more about the "mining town" strategy?
Faith: The “mining town” strategy is focused on capitalising on the exponential growth that is occurring in particular regional areas. The residents in these areas have high disposable incomes and there is a lack of existing retail options in these towns. The mining town strategy does not mean that other areas will be ignored, but demonstrates how RFG sees multiple opportunities across the retail landscape and mining towns is just one of these opportunities.
QSR Media: What kind of returns do you think you will see in these stores given they are tapping into the mining boom?
Faith: The nature of mining towns means that these stores have the capacity to generate the levels of returns that well-established stores enjoy, but within a much shorter timeframe. The stores that have recently opened in key mining town locations have been enjoying high levels of sales that have exceeded initial expectations. This is due to a range of factors, including a high level of demand and low level of existing competition.
QSR Media: How are you going select and recruit quality franchisees given the stores are in more remote locations?
Faith: Selecting the right franchisees is the key to the success of a store. RFG has criteria that applicants must meet and it is a process that is worked through with potential franchisees. At the moment RFG is looking for enthusiastic and motivated entrepreneurs who already live in these areas or are looking to relocate. From our experience, if potential franchisees are willing to relocate to operate a store in these areas they are highly committed to developing a successful business and do so.
