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In The News

LATEST – Lease dispute mediation scheme still available 10th May 2021

11 May 2021 – The Ministry of Justice has advised that the Dispute Resolution Scheme aimed at helping resolve commercial lease disputes arising from Covid-19 is still available, but that eligibility will be considered on a case-by-case basis.

Burger King NZ sold for $30 million 6th May 2021

The troubled Burger King NZ operation was sold to the Tahua Capital investment group for $30.48 million, it has been revealed. Tahua already owns the New Zealand Starbucks master licence, which it bought in 2018.

According to receiver Brendon Gibson’s report the secured creditors of Burger King, including ANZ, ASB and Rabobank, were owed more than $50 million. The banks supported the receiver's compromise deal, and had agreed to share half of any sale proceeds over $30m if the company was sold as a going concern.

All Burger King outlets in New Zealand are owned by the master licensee, with no individual franchisees affected. Five company-owned stores were closed when the company went into receivership in April 2020.

Lockdown lease disputes – recent decisions provide hope 6th May 2021

UPDATED 11 May 2021 – With some landlord/tenant disputes continuing to cause distress, two recent decisions involving hospitality businesses offer hope to tenants. Paul Turner and Scott Goodwin provide some background and look at the implications.

2021 Franchise Awards open for entry 4th May 2021

May 2021 – After a year off, the Westpac New Zealand Franchise Awards are back for 2021 in a new format which makes entry easier and more attractive than ever.

Small business bouncing back, says Xero 4th May 2021

Xero's new Small Business Index shows that the small business sector is performing better than average. The index rose 17 points to 122 in March, up 16 percent from February, and all four sub-metrics of sales, jobs, time to be paid and wages improved during March. It was the second month the index was above 100, indicating that overall small business had made a solid start to 2021, Xero said.

New Zealand Natural back in Kiwi ownership 21st April 2021

14 April 2021 - Graeme and Harry Hart's family food business Walter & Wild has bought Emerald Foods Group for an undisclosed amount. The company, which includes the New Zealand Natural franchise, has been owned by a Hong Kong-based entity since 2015.

The business includes premium ice cream brands New Zealand Natural, Killinchy Gold, Zilch and Chateau, along with the licence to operate the Movenpick brand in New Zealand. Walter & Wild's portfolio also includes Hubbard's, Gregg's, Aunt Betty's, I Love Food, Hansells and Alfa One.

McDonald’s reveals impressive NZ shopping list 9th April 2021

9 April 2020 - McDonald’s New Zealand has revealed it spent $156.9 million on ingredients ordered from New Zealand’s primary industries in 2020. A further $222.5 million of produce was exported, bringing the total spent with Kiwi producers by McDonald’s to $379.4 million.

Climate Action Toolbox helps smaller businesses cut carbon emissions 30th March 2021

31 March 2021 - The Sustainable Business Network has created a free, comprehensive toolbox to help smaller businesses act on the climate.

Customers to get the credit for new franchisees 24th March 2021

25 March 2021 – Mobile franchise Harrisons is offering an incentive to customers to help find new franchisees

Housing policy to boost business ownership? 24th March 2021

24 March 2021 – Broker says housing policy could make buying a business a more attractive option for investors - but how many will do it?

Preview: Franchise Conference 2021 1st March 2021

The National Franchise Conference focuses on prospering in a changing world

More Taco Bell stores planned for NZ 25th February 2021

Restaurant Brands is planning to open 10 new Taco Bell stores in New Zealand and Australia in the coming year. There are already three outlets here, all company-owned. Restaurant Brands has not announced any plans to franchise them after turning in a positive result in its latest annual report.

While five weeks of lockdown cost the company $40m in sales, once alert levels shifted, sales were strong particularly for the company's KFC and Carl's Jr. brands. Same store sales for the full year were up 5.3 per cent.

Economic Overview - mixed blessings 16th February 2021

16 February 2021 - Despite a sharp bounce-back in economic activitity, growth will probably be subdued this year. Expect a wider economic lift-off when the border re-opens, says Westpac in its latest Economic Overview

Franchise survey: what a difference a year makes 15th February 2021

16 February 2021 – The first Franchising Confidence Index survey since January 2020 shows that franchisors and specialist service providers are feeling much more confident about the year ahead. Although the survey was conducted just before the current rise in Alert Levels, it compares well with January 2020 when Covid-19 was still a distant cloud on the horizon.

Covid-19 financial support for businesses - updated 15th February 2021

19 February 2021 - In December 2020, the Government announced the support that would be available to New Zealand businesses in the event of a resurgence of Covid-19. Given the current change in Alert Levels, here's an update from the team at Franchise Accountants.

Auckland businesses can register for travel 14th February 2021

15 February 2021 - Businesses inside the Auckland Alert Level Boundary can register online for travel documents allowing workers to cross boundaries

Franchise calls for changes to sick leave extension 5th February 2021

February 2021 - Supermarket franchise group Foodstuffs has expressed concerns about the planned increase to sick leave, saying that costs to businesses could double and it was unlikely that businesses will recoup these costs in productivity gains.

The company's Government relations head Melissa Hodd suggested Parliament’s Education and Workforce select committee should instead consider recommending an increase in the minimum entitlement to seven or eight days. It should also consider reverting back to a five-day minimum entitlement after the Covid crisis, she said.

Another suggestion put forward by Foodstuffs was that the Government should consider sticking to a five-day minimum entitlement while raising the cap on the amount of sick leave employees are legally entitled to carry forward from year to year from 20 days, to 25 or 30 days.

Coffee franchise launches collagen product 28th January 2021

28 January 2021 – Columbus Coffee cafés across New Zealand are launching collagen creamer as an option for wellbeing-conscious customers

Report finds demand for businesses outstrips supply 26th January 2021

January 2021 – A new report from ABC Business Sales suggests that the current business sales market is experiencing a significant gap between supply and demand, leading to increased prices. This could make greenfield franchise opportunities more attractive.

Calls for Covid scanner use to prevent more lockdowns 14th January 2021

Small businesses fearing they wouldn't survive another lockdown are calling for greater pressure on customers to make use of the Covid-19 tracer app now, rather than waiting for another community outbreak. The virulent new strains have already caused further lockdowns in many countries, and rapid tracing would be vital to the prevention of a new outbreak here. However, use of the tracer app among Kiwis has dropped off alarmingly, with many saying they will start using it again only if there is a new outbreak - by which time it will be too late.

In a Stuff article, First Retail Group managing director Chris Wilkinson said that the risk of not signing in to businesses is the “cataclysmic” shutting down of everything again.

“We’ve already seen what a second lockdown did to Auckland ... it was heart-wrenching to see the impact that had on businesses, the confidence of staff, and consumers.”

Wilkinson said scanning “peer pressure” should be encouraged, and political leaders needed to be actively scanning by example, and assigning scan “champions” to sectors.

In-store spend up, online down 12th January 2021

Kiwis ended 2020 on a strong note with a total retail spend for December of $6.1 billion, 2.3% higher than December the previous year. Figures from Datamine show that in the lead up to the holiday period, New Zealanders spent $620 million more than in November.

The figures also suggested that New Zealanders are supporting local by opting to spend in person rather than online.

In-store spend, at $5.4 billion, has grown 13.4% since last month and 4% compared with December 2019. As in previous months, online spend has continued to show negative growth compared to the same month last year, particularly spend at overseas companies, which is down 21.6%.

With a 48% drop in Travel and Accommodation spend, compared to December 2019, New Zealanders instead have spent money on:

Liquor Stores (18.6% year-on-year increase),
Furniture, Appliances and Homewares (15.1% year-on-year increase),
Health Goods and Services (13.1% year-on-year increase),
Clothing and Footwear (11.1% year-on-year increase)

(Datamine requires a log-in to see the full report)

Make a new start in 2021 10th January 2021

Supermarket franchisee goes large 10th January 2021

A prominent New World franchisee, Jason Witehera, is tipped to be the new owner of Pak'nSave Albany - one of the country's largest supermarkets which is thought to have the largest revenue of any in New Zealand. Mr Witehera is one of the rising stars of the Foodstuffs co-operative, having commenced his career as a shelf-stacker at age 16. Outgoing franchisee Paul Blackwell has reportedly become a director of an investment group which owns Starbucks New Zealand and is buying Burger King New Zealand from the receivers.

In a deal due to settle later this year and which could be for around $50 million, insiders say the transition is on although owners are yet to confirm that.

Insiders in giant co-operative Foodstuffs which owns the Pak'nSave and New World stores say it is common knowledge within the business about the sale which will then automatically trigger the sale of a second high-profile, highly profitable store because owners can only have one supermarket each.

Hollywood star's burger franchise to open in NZ 7th January 2021

Wahlburgers, the Boston-based restaurant company founded by brothers Mark, Donnie and Chef Paul Wahlberg, is expanding its international footprint with a franchise partnership that will span 20 locations across Australia and New Zealand. The Australian master franchisee plans to open five outlets here over the next five years. It is not yet clear whether the brand will be sub-franchised to individual operators.

'Over the course of my career I’ve had the pleasure of filming in Australia and New Zealand and am grateful for the opportunity to now share my family’s delicious recipes with the people of these great two countries,' says Mark Wahlberg. 'With 49 Wahlburgers locations across the USA, two in Toronto Canada and one on the American Ramstein Air Base in Germany, this expansion to Australia and New Zealand is a really exciting step in continuing to build this brand around the world.'

Racing Ahead to 2021 22nd December 2020

Thank you to all our sponsors, advertisers and readers for your support through this challenging year for all of us. We wish you all the best for a very Merry Christmas and a Happy and Prosperous New Year. Enjoy the summer - and if you do start to think about new opportunities, here are some resources.

Lower card fees planned for small businesses 9th December 2020

10 December 2020 – Government plans hard cap for merchant services fees to encourage contactless payment; consultation sought

How will the Privacy Act changes affect your franchise? 25th November 2020

25 November 2020 – As email attacks and fraud grow, new data privacy laws require businesses to be aware of their governance and compliance responsibilities

Auckland event - Christmas Drinks 24th November 2020

BoP Event - 2020 Round-Up 24th November 2020

A free after-4 event being held in Tauranga will help franchise people catch up after a challenging year

Good news, but lower unemployment and immigration a challenge for franchise recruitment 24th November 2020

24 November 2020 - The latest issue of Westpac’s Quarterly Economic Overview explains why the economy is where it is, and looks at the implications of Covid-19, local and global economic expectations, and forecasts for the future. How will franchising be affected?

What to look for in a franchise 12th November 2020

Jessica Satherley of Red News sat in on our recent 'Business after Redundancy' webinar - here are some of the things she learned about what to look for.

NZ small businesses feel the love, global survey reveals 25th October 2020

26 October 2020 – NZ small businesses and consumers had the most positive outlook during Covid-19

New franchise event in Wellington 25th October 2020

Franchisors, franchisees, and anyone interested in learning more about franchising are all welcome to a franchise networking event being run in Wellington on Wednesday, 4th November 2020. Hear insights from three top franchisors.

BurgerFuel quits USA 23rd October 2020

23 October 2020 - BurgerFuel is to close its single store in the USA, as part of a deal between the US master franchisee (and BurgerFuel's original founder) Chris Mason and the NZX-listed BurgerFuel Group. The decision brings to an end an adventure which started in 2014 when the US company Franchise Brands took a stake in the New Zealand chain. Franchise Brands was associated with Subway founder Fred DeLuca, but the partnership came to an end following DeLuca's death later that year.

Chain founder Chris Mason took over the rights to the BurgerFuel USA master franchise in 2018, after the board of New Zealand-based Burger Fuel Group decided it was not viable to expand into the US market.

At the time, Mason stepped down from Burger Fuel Group’s board but retained his roughly 11 per cent stake in the company.

But on Friday, Burger Fuel Group, which included the Shake Out and Winner Winner brands, advised the New Zealand stock market that it would acquire 1,538,461 shares from the Mason Family trust to settle debt relating to the US venture.

Starbucks owners buy Burger King NZ 20th October 2020

20 October 2020 - Tahua Partners, the company which owns the New Zealand master licence for Starbucks, has bought Anares, the trading company which operates Burger King in New Zealand. After reportedly seeking a buyer for some time, the parent group of companies which own Antares went into receivership on April 14, during the coronavirus lockdown but Antares continued to trade during the sale process. The price was not disclosed.

Burger King is the third largest quick service restaurant chain in New Zealand, with 78 restaurants nationwide employing 1800 staff. Neither Starbucks nor Burger King offers sub-franchises in this country, with all stores being company-owned.

After Antares’ parent company went into receivership, negotiations with landlords, creditors and the franchise holder, led to a compromise, allowing the restaurants to remain open while a buyer was found.

However, five Burger King restaurants – Lambton Quay, Courtenay Place in Wellington and Queen Street, Takapuna and West City in Auckland – would close as part of the deal.

Masterclass for franchisor development 12th October 2020

12 October 2020 – The popular Franchisor Excellence Masterclass is back at the end of the month, with online delivery making it easier than ever for Kiwi franchisors to attend

Eat Fighter: rivals co-operate in battle of the brands 6th October 2020

7 October 2020 – Two of New Zealand’s best-known food franchises are going head-to-head to win customers

Subway bread not bread, say Irish 1st October 2020

2 October 2020 - The rolls used in Subway's hot sandwiches contain too much sugar to be considered bread, according to Ireland's Supreme Court. An Irish franchisee of the US company had claimed it should not pay VAT on the rolls it uses in heated sandwiches, but the court ruled that because of the level of sugar in the rolls they cannot be taxed as bread, which is classed as a "staple product" with zero VAT.

Under Ireland's VAT Act of 1972, ingredients in bread such as sugar and fat should not exceed 2% of the weight of flour in the dough. The judges concluded that in Subway sandwiches the sugar content is around 10% of the flour in the dough for both white and wholegrain rolls.

Franchise Summit moved to November 28th September 2020

Assistance available for lockdown lease issues 28th September 2020

28 September 2020 - The Government has at last announced details of its arbitration and mediation funding package aimed at resolving ongoing disputes between commercial tenants and their landlords arising out of the Level 4 and 3 lockdowns. However, unlike the original proposal of 4 months ago, landlords can't be forced to participate.

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