Hog’s Breath Cafe announces two more restaurant closure

It said it will tighten the reigns on franchisees to ensure compliance within the franchise network.

Hog’s Breath Cafe is closing its Dandenong and Karingal restaurants in Victoria.

Dandenong will close due to ongoing health issues experienced by the franchisee who travelled to the UK to be with a terminally Ill relative and has since undergone a back operation which will not allow him to travel. The brand said there is a new landlord at the site who will not offer an extended lease.  

Karingal is closing due to the long-term negative impact of the shopping centre renovations that decimated the food precinct. The restaurant was able to trade through Covid and continued shutdowns but the deferred rental and increased competition in the new food precinct means the business is no longer sustainable for the franchisee. 

Hog’s Breath Cafe CEO, Steven Spurgin, said they will be looking at new sites with smaller model restaurants in these areas, as well as Coffs Harbour, Tuggerah and Gladstone, which have also recently closed. Hog’s is already speaking with an interested party to take over the Coffs Harbour restaurant and is on the hunt for operators to take on the new model restaurants in the other locations.

Spurgin said the new model restaurants will make business more sustainable for franchisees for a number of reasons - most notably a reduction in the cost of rent, electricity and gas, as well as being able to adequately staff the restaurants. This is in line with a global trend of restaurants downsizing due to staffing pressures, but also to create a more intimate dining experience which is preferred by most diners.

“The changes being implemented, including a new restaurant size and interior design, will ensure the sustainability of the franchisees and the brand," said Spurgin.  

“Despite recent reports, Hog’s Breath Cafe as an entity is not experiencing financial difficulties. We have many successful restaurants and happy franchisees and we’re very confident in the further expansion of the brand under new management, with our new interior design and size of restaurant, and our continued regeneration in a post-Covid world.”

HBC Management, which is wholly owned by original Hog’s Breath Cafe owners Don Algie and Ginger White, bought the Hogs Breath Cafe franchise system back from HBCA, which previously operated the franchise system as Hog’s Australia’s Steakhouse, in October 2020. 

The current owners founded Hog’s Breath Cafe 34 years ago this year, and have spent the last 2.5 years planning for it to be around for at least another 34, whilst navigating the tough business environment they entered. Their vision is to take Hog’s Breath Cafe back up to the 85 restaurants it had at its peak in 2016. 

Steven Spurgin went on to say that the reins have been tightened on franchisees to ensure compliance within the franchise network.

“It’s the responsibility of Hog’s Breath Cafe, as a franchisor, to ensure compliance within the franchisee network. Franchisors can be held responsible if franchisees don’t follow workplace laws and regulations so our franchisees are held to strict standards for both the protection of their employees and the Hog’s Breath Cafe brand.

“If franchisees are unable to meet these standards, we work with them to correct the activities that are non-compliant, but if they are still unable to bring their businesses into compliance, their franchise agreement will be terminated, either by mutual agreement or by a decision from the Franchisor.

“Unfortunately, we may see further closures as a result of this, but we will do all we can to keep open and sustainable, but we’re committed to operating within the Franchising Code of Conduct, and meeting all the requirements of running a business in Australia, including abiding by business and tax laws.

“When we are forced to close a restaurant or a franchisee decides to leave the system, we work closely with the staff to ensure they are aware of the process as well as their rights, but ultimately the employment relationship is between the franchisee and the staff members.

“Our head office team works extremely hard to provide our franchisees with the tools they need to remain compliant, including training, financial review, operational support and business development”, finished Spurgin.