In The News

Mike and Lisa Keffler sold their house in Auckland and moved to Rotorua, where they and their young family couldn’t be happier. Parin Desai has established himself as part of the local community in Whakatane. John Alipate is a Dunedin man through and through and wanted to stay in the city he loved, while Ashneer and Durgeshni Datt –­ also refugees from the hectic pace of Auckland – were welcomed by the mayor and the local MP when they arrived in Invercargill. All of them found business opportunities through franchising in the places they wanted to live.

According to the headlines, business these days is all about the growing population of Auckland and the reconstruction of Christchurch. Yet the people above, and others you can read about on this website, prove that there is life outside the big cities and that it can be very rewarding indeed.

‘In fact,’ says Daniel Cloete, National Franchise Manager for Westpac, ‘I have found that in many franchise systems, some of the most profitable outlets in New Zealand are located in the regions rather than the major centres.’

The key word here is.... Read the rest of this article.

His company provides seed financing for its franchisees to create their own drinking water company designed for the under-served (read: not wealthy) people in any variety of African communities.

With sub-par water treatment, crumbling pipes, weak building codes and widespread industrial contamination, providing clean water in many African villages is a persistent, Herculean task.

Jibu places drinking water franchises approximately one mile apart, drawing water from any neighborhood source and filtering it on the spot using advanced water filtration equipment. The company acts as a fair-lending bank that offers affordable financing to its franchisees. No middleman. No dependency on donations that could dry up. Low prices. New jobs.

With seven franchises, some making more than USD$85,000 per year, Jibu’s network has distributed more than 1 million gallons of water and reached more than 10,000 people with safe, clean water.

The company is on track to launch two franchises per month throughout 2015, and has raised more than $2.4 million through private equity and grants to support its future growth—a promising record for a socially aware and ambitious entrepreneur, as well as his franchisees and their customers.

Meanwhile, a franchisee told the 7-Eleven field investigator that some staff members hadn't been paid for six weeks because they "don't care if they haven't been paid correctly as money isn't important to them".

The Melbourne-based franchisee was caught paying A$12 ($13.30) an hour to staff – well below the award rate of A$24 an hour – and was withholding the passport and driver's licence of a staff member.

The offences were handled internally.

"They constitute a breach of the 7-Eleven Agreement" and "the expectation is that you will remedy the breach by doing the following: 1. Return the passport and driver's licence. 2. Pay monies owed to your employees through the 7-Eleven payroll system so we can verify that the breach has been completely remedied."

They are just a handful of the more than 2000 extracts of on-the-record interviews conducted by field inspectors and placed on a central database at head office, obtained by Four Corners and Fairfax Media's Business Day.

Part 1   Part 2

"While I do not minimise the adverse effects of Mr Heath and his family and the threat that it will be necessary to sell the family home after four to five months if an injunction is granted, sight should not be lost of the fact that Mr Heath was aware of the restraint provisions and made the decision to terminate his relationship with Mike Pero without apparently putting in place any plan for protecting his income without breaching his agreement...in this sense I am satisfied that Mr Heath has brought these consequences upon himself through his own actions," Justice Moore said.

The judge was satisfied that an injunction against Heath should be granted while the franchisees work out the dispute with Mike Pero Mortgages.

He ruled that Heath should not be involved in a mortgage broking business in Canterbury for two years or elsewhere in New Zealand for six months or until further order of the court.

Y&R NZ chief executive and chief creative Josh Moore says the campaign is the result of “perseverance, late nights and an 18-month collaboration” with the global Burger King marketing team.

“When we first tabled this idea with Burger King we knew it was a long shot – asking a global icon to take their hero product and blend it with that of their biggest competitor.

“But we’ve been totally overwhelmed by the enthusiasm and appetite for big thinking and bold ideas at all levels of Burger King. I only hope McDonald’s jump on board and make this a monumental event in the name of Peace Day. Let’s end the beef, with beef.”

A dedicated website has also been set up for the ‘McWhopper.’

Heath was a Mike Pero franchisee in Christchurch for 15 years and in 2009 won a New Zealand Mortgage Brokers' Association award. But he advised the franchisor earlier this year he would not be renewing his franchise agreement and was in the group that in April filed proceedings.

Mike Pero (New Zealand) is owned by Australia's Liberty Financial, and has 36 franchisees around this country. While it bears the name of its founder, Mike Pero, he no longer has any part in the business.

Queen's Counsel for the franchisor firm, Bruce Stewart, argued the company would be harmed if the interim orders weren't continued and said that eight of its other franchisees in Canterbury deserved protection.

Managers from head office in Sydney told the franchisees the price cut would lift overall sales and benefit everybody.

LYN BAYAKLY: I remember sitting in a meeting in October of last year with a bunch of people from head office that came over here to WA and I was looking around the room and I'm looking at them thinking, "You guys have all got degrees in something and you've all failed Year Four maths."

PAT MCGRATH: Sales did go up, but Lyn Bayakly was selling pizzas below cost.

LYN BAYAKLY: So when there's no profit margin, when you're actually losing on every transaction, the higher your transaction count, the more money you lose and the quicker you lose it.

PAT MCGRATH: Now Lyn Bayakly has joined dozens of franchisees in a class action against Yum! Brands. They claim the company acted unconscionably and breached its duty to ensure franchisees as well as the parent company can make a profit.

Morton says the success or failure of stores is in the hands of their operators. 'It comes down to their processes ... how much value-added did they do to the product? How much trimming did they do? Are they prepared to buy more bodies of beef in and break more bodies of beef down rather than buying mince trim in?'

Morton says making a store profitable can be complex. 'A good butcher should have those skills, but it will vary,' he says.

Mad Butcher franchisees are restricted to purchasing product from a list of more than 30 approved suppliers such as Tegel, Wilson Hellaby and Affco.

'They can play one supplier off against another [to get better pricing] ... And some franchisees are a lot better at doing that than other franchisees,' says Morton.

He rejects claims that he has acted in a threatening manner during meetings with franchisees who wanted to get out of struggling stores. 'What I've said in meetings is, "Don't just think you can walk away from your debts. Don't believe that a liquidator is just going to make this all go away."'

"While it would be premature to start speculating now, we have been scanning the market in a number of sectors, including Mexican, and Asian," Van Arkel said.

Burger joint Carls Jr might also be making an entrance to the Christchurch market. The chain is established in the North Island, with a number of stores in Auckland, but has not yet made the shift down South.

In early 2014, an internal fraud report found disproportionately high refunds being paid out, which dovetailed with shifts when Tiongson was acting as manager.

She admitted she had her hand in the till during a disciplinary hearing and was duly dismissed.

Her defence counsel was also "somewhat surprised" to see the franchise owner at McDonalds was keen for her to avoid a custodial sentence.

Judge Ronayne, however, did not share their sympathy.

"I'm not sure she had any belief she was entitled to take the money. On the contrary, I think she knew perfectly well she shouldn't take it," he said.

"The motivation for this was a combination of misplaced need but also some greed. I can't ignore the comments to the probation officer that having got away with it, it simply became a habit."

McDonald's new global chief executive, Steve Easterbrook, unveiled a major restructuring plan last month that aims to improve the Golden Arches' poor recent performance.

The company is hoping to save US$300 million a year by 2017 by selling more than 3000 company-owned outlets to franchisees, which would increase the proportion of franchise-run outlets globally to 90 per cent from around 80 per cent currently.

McDonald's New Zealand managing director Patrick Wilson was unavailable for comment today.

Company spokesman Simon Kenny said there had been "no material impact" from the restructuring in this country so far.

"It's been business as usual since the announcement," he said.

Restaurant Brands - whose businesses include Pizza Hut, KFC and Carl's Jr - posted a 9.2 per cent lift in sales, to $359.5 million, for the year to March 2.

Its profit jumped 19.4 per cent to $23.8 million.

Managing director James Tucker said the funds would have let Mad Group open another six to eight Mad Mex stores, to add to the six stores it has already, and achieve "critical mass".

Tucker said he remained "100 per cent confident" Mad Group would raise the funds it needed to grow Mad Mex.

It would now approach the 98 investors who had applied for shares to see if they were still keen to subscribe for them in a private offer, he said.

Discussions were also planned with other potential investors who had come forward as a result of the campaign and who had expressed interest in separately investing sums between $150,000 and $1.5 million, he said.

Mad Group's bank had offered further support to expand the enterprise, which meant it would only need about $500,000 to see through its original expansion plan, he said.

"There are a lot of wheels in motion that couldn't start until the offer closed on Friday, so now this week we are full steam into working through these other options."

Tucker believed New Zealand could support 30 to 50 Mad Mex stores in the "medium term" and said he was not sure why the equity crowdfunding campaign had fallen short.

"The business is focused on achieving revenue growth through boosting current sales, opening new stores and investigating new territories," said chairman Keith Jackson. "Cooks sees significant opportunities to export New Zealand's cafe culture into new markets and existing markets."

In the latest year, revenue doubled to $8.9 million from a restated $4.4 million the year earlier. Three quarters of the revenue came from the Esquires Coffee House unit, with the remainder from the supply division, which includes Scarborough Fair beverage products and Progressive Processors' kiwifruit and asparagus, which supply Esquires stores and other customers.

The Verge website reports:

'There are four different boxes, each of which comes with a separate movie download via a QR code. They're called Slice Night (for horror fans), Anchovy Armageddon (for science-fiction), Hot & Ready (for romance), and Fully Loaded (for an action flick). The box itself is fittingly called the "Blockbuster Box."

Of course, you'll need a very dark room to be able to make out anything from the "projector," and even then, the quality will still be pretty piss-poor. That's not to mention the fact that you'll probably get your phone all greasy by sticking it in that pizza box, and that you'll have to try to make out whatever muffled audio makes it through the walls of the pizza box. We're not letting that stop us from trying it out though — we just need to find a way to get to Hong Kong first.'

'Hong Kong-based Emerald Foods Group (HK) bought 100 percent of the shares in Foreman's Emerald Foods subsidiary on June 3, according to Companies Office filings, completing an acquisition that had been approved by the Overseas Investment Office in April. The acquisition needed OIO approval because Emerald Foods owned sensitive land in East Tamaki, Auckland.

Foreign acquisitions need OIO approval where there is an interest in sensitive land, or the transaction is more than $100 million. The value of the Emerald deal was withheld.

The Hong Kong entity is 80 percent owned by Australian interests, with US investors holding almost 16 percent and other overseas people holding 4.3 percent, according to the OIO summary.

"The applicant intends to develop the business located on the land, with particular regard to exports to China," the OIO summary said. The office granted approval after being satisfied it would increase export receipts and attract additional investment for development. It also met the consequential benefits test, where the OIO believes it will provide additional New Zealand investment, sponsorship or community projects.'