In The News

7-Eleven deed sets new standards for franchise compliance 19th December 2016

Embattled Australian convenience retailer 7-Eleven has entered into a proactive compliance deed with the Fair Work Ombudsman to reform its internal systems and procedures to stamp out the wage fraud which has scandalised the brand for more than a year, according to a media report.

Jason Gehrke of the Franchise Advisory Centre advises that the proactive compliance deed – a binding legal agreement – requires 7-Eleven to undertake and implement a number of initiatives that will reduce and potentially eliminate the capacity for wage fraud to re-occur in its network.

Jason notes that that 7-Eleven is unique in the franchise sector in its application of a gross profit-share royalty model (rather than a fixed fee or percentage of turnover royalty model), which has been criticised by some observers as a contributing factor for franchisees in the underpayment of employees. The Fair Work Ombudsman does note that 7-Eleven has since changed its financial model to provide greater financial assistance to franchisees, and is now also required to provide detailed wage information to potential franchisees.

The initiatives include thumbprint scanning of workers to clock on and clock off at the start and end of their shifts, backed-up by a network-wide CCTV system monitored by 7-Eleven head office; continued rectification by 7-Eleven of unpaid staff wages; the introduction of a mandatory centralised payroll system that all franchisees will be required to use; the establishment of an employee consultation group that specifically excludes franchisees; and a raft of other measures.

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Focus on franchisees as CrestClean celebrates first 20 years 16th December 2016


Close Nosh or find a buyer, ANZ tells Veritas 14th December 2016

14 December 2016 - Veritas Investments, the owners of Mad Butcher and Nosh, has been told by its bankers to sell the Nosh gourmet food store business by 31 March 2017 or close it down. The company was previously hoping to franchise the six Nosh stores it owns. Two other Nosh stores (Constellation Drive on the North Shore and Mt Maunganui) are already franchised; there is no mention of how those franchisees will be affected in today's NZX announcement.

Veritas is required under the revised ANZ facility to deliver to ANZ by 15 January 2017 either an unconditional contract for the sale of Nosh, or a proposal to close and wind down Nosh. Veritas is also required to close and wind down Nosh by 31 March 2017, if it cannot be sold by that date.

Given the time available before 15 January 2017, the Board cannot be certain that a sale of Nosh can be agreed by that date. The Board therefore proposes to investigate the proposal to close and wind down Nosh by 31 March 2017, as part of its strategic plan for the group.


Retail, hospitality expect a good year ahead 14th December 2016


Kiwis name NZ’s favourite takeaway 8th December 2016

8 December 2016 – One home-grown franchise has replaced another at the top of a major customer satisfaction survey

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Creator of the Big Mac dies 1st December 2016

Jim Delligatti, the McDonald's franchisee who created the Big Mac nearly 50 years ago and saw it become perhaps the best-known burger in the world, died on Monday in Pittsburgh.

Jim Delligatti told The Associated Press in 2006 that McDonald's resisted the idea at first because its simple lineup of hamburgers, cheeseburgers, fries and shakes was selling well.

'They figured, why go to something else if (the original menu) was working so well?' Delligatti said then.

McDonald's has sold billions of Big Macs since then, in more than 100 countries. When the burger turned 40, McDonald's estimated it was selling 550 million Big Macs a year, or roughly 17 every second.


Another minimum wage breach in New Zealand 1st December 2016

More and more breaches of the Minimum Wage Act, Holidays Act and Employment Relations Act are hitting the headlines, with the latest being at a kebab shop in Rotorua. All the New Zealand cases to date have involved independent businesses; however; franchisors would be well-advised to audit their franchisees' employment practices to avoid the publicity which has affected brands such as 7-Eleven and Caltes over the Tasman.

The job description attached to his employment agreement specified Mr Corten would work 40 hours a week at $18 per hour.

But for the duration of his employment Mr Corten worked six days a week, from 8.30am until 10pm. He took no holidays while employed and was paid $720 a week, either in cash or cheque, which works out to about $8.90 an hour.

He resigned in September 2013 following disagreements with Mr Efendi.


Another wage problem for Australian franchising? 27th November 2016

The Caltex chain in Australia has been accused of systemic worker exploitation throughout its franchise network. An investigation by the team of journalists behind the 7-Eleven expose last year has, according to Fairfax Media, 'unveiled a brutal franchise structure which some operators claim leaves little option but to defraud workers.' The Australian Fair Work Ombudsman confirmed it has been contacted by a worker in relation to this group but couldn't comment further due to the 'wider compliance activity relating to Caltex franchisee outlets.'

Caltex Australia CEO Julian Segal has said, 'Depriving employees of their entitlements is illegal and immoral' and has promised the company will review the franchise model, including the franchise agreement, the financial returns as well as the ongoing governance and compliance arrangements.

When the 7-Eleven scandal broke in August 2015, one franchisee wrote an email warning: 'It is inevitable that this will get out. It is only a matter of when, not if. What damage will this cause to the Caltex brand?'

The company took action, including auditing some franchisees for suspicions of wage fraud. It then made contact with the Fair Work Ombudsman and separately investigated eight franchisees and terminated five of them, equivalent to 13 sites. It is reportedly investigating 50 more sites. However, the terminations have themselves been criticised as termination due to a breach of the franchise agreement means the value of the business returns to Caltex.

There is no connection between the Australian-owned Caltex operation and the Caltex brand in New Zealand, which is operated by Z Energy Ltd under licence from Chevron International. The largest individual shareholder in Z Energy is the New Zealand Supernnuation Fund.

Read the Fairfax report

Is it worse than 7-Eleven?

Caltex SEO speaks out on illegal and immoral actions

An internal Caltex document presented to franchisees in August on workplace obligations outlines "common mistakes".

The list includes not paying an employee for trial/training shifts, not recording and rostering the hours worked by the franchisee and not having these records available and not checking if visa requirements are up to date.

One of the more egregious "common mistakes" was "not paying wages … on a regular basis/on time and not having required records of wage payments (especially when cash wages are paid)".

In a statement Caltex described the "common mistakes" as examples "provided by way of illustration and do not reflect Caltex's behaviour".

It says the company had always made it clear to franchisees that they are required to operate their businesses in full compliance with all laws, including the Fair Work Act.

But it will not commit to a compensation scheme where it finds exploited workers who have been systematically ripped off, similar to the scheme set up by 7-Eleven, which has so far paid A$50 million in back pay to workers.

Instead, it points the finger at franchisees, saying "franchisees are responsible for ensuring their employees are correctly paid. Caltex is providing practical support to those employees such as helping them secure ongoing employment if possible as well as assisting them to pursue a claim against their former employer".

But it isn't as simple as that. If a franchisee is terminated and loses the value of the goodwill, it is hard to chase them down to repay workers as some of them will have nothing left except a big bank loan to repay for a business loan they took and no income to repay workers.

In addition, many workers are too afraid to come forward for fear of retribution.


NZ economy – stronger for longer 22nd November 2016

Stronger population growth, rising business confidence and a rebound in milk prices point to an enduring period of growth for the New Zealand economy, says the latest Westpac Quarterly Economic Overview

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Mad Butcher liquidator on ridiculous crusade, claims owner 16th November 2016

A dispute between Veritas Investments, owner of the Mad Butcher franchise, and the liquidator of the original Mangere store could end up in court after liquidator Peter Jollands accused the company of having 'an unworkable business model' for franchisees and of failing to provide company records. Veritas chairman Tim Cook says the company had provided everything required and called Jolland's actions 'a ridiculous crusade.'

Veritas chairman Tim Cook, however, on Tuesday detailed what he called the facts of the Mangere liquidation and his frustration with Jollands.

He said he could not comment on Jollands' claim the Mangere store had begun losing money in the years prior to its sale, other than that Leitch had a "very successful business" there.

But he ran through a series of phone calls, meetings and other dealings with Jollands, where the franchisor wanted to find a workable solution for the store's owner rather than put it in liquidation.

Other stores, such as one in Rotorua, had become one of its big successes after a "motivated" operator took it over using exactly the same business model.

Cook said they offered "an enormous amount of free help" to turn around the Mangere store, including bringing in a proven operator and free advertising.

The franchisee had admitted in those meetings the failure was his fault, and was a minority shareholder and manager before buying the store outright, Cook said.

But the next thing Cook knew, the store had gone into liquidation


Franchise Awards 2016 RESULTS <br>- learning from experience 12th November 2016

12 November 2016 – The top titles this year have gone to franchises with decades of experience - and home-grown franchises took the majority of the honours

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Franchise figures honoured at Awards 12th November 2016

12 November 2016 - Two people who have made huge contributions to franchising were honoured at the Westpac New Zealand Franchise Awards

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Immigration to NZ, Brexit and the Trump Factor 9th November 2016

Simon Lord talks to Bill Milnes of Laurent Law and Andy Chang of Westpac about immigration trends and their impact on franchising

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McDonald's US ditches 'Create Your Taste', franchisees say brand in deep depression 4th November 2016

McDonald's has put a halt to its Create Your Taste made-to-order programme in the US and replaced it with a simpler version which offers fewer options. A Business Insider report says that many franchisees in the US had invested around NZ$170,000 per location with plans to install the 'Create Your Taste' kiosks in up to 2,000 restaurants across the US. Create Your Taste is in around half of all outlets in New Zealand, where service time is arguably less of an issue than in the US.

An October survey by a Nomura analyst suggested that many McDonald's franchisees in the US believe the brand is in a 'deep depression' and could be facing its 'final days', with one suggesting, 'Probably 30 percent of operators are insolvent.' However, the survey represented only 29 US franchisees with 226 restaurants out of more than 14,000 in the US. Nomura maintained a Neutral rating on McDonald's stock.

Business Insider's Hollis Johnson tested the programme at a New York City McDonald's and paid US$10 for a burger with bacon, tomato, onions, cheddar cheese, guacamole, and two sauces, along with sides of fries and a drink. That's about twice the cost of a Big Mac meal. His meal took eight minutes to prepare.

Some franchisees also complained about the cost of the programme, and said it slowed down kitchen operations and targeted an upscale customer that McDonald's shouldn't be going after.

McDonald's decision to get rid of the full Create Your Taste menu and replace it with Signature Crafted Recipes should help solve some of these issues.

Signature Crafted Recipes has fewer options for customisation than Create Your Taste with bundled toppings that should make it easier for kitchens to handle. The company started testing it earlier this year.


High-earning US brands seek local partners 31st October 2016

A top US franchise executive is visiting NZ this summer to look for partners for some of America’s top-earning franchises


Australian franchising: <br>growing or not? 28th October 2016

11 October 2016 - Initial results from the Franchising Australia 2016 survey show that sales and employment within franchising are up slightly since 2014 but numbers are static. Is it out-performing the general economy?

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Australian Franchise Awards<br>2016 Results 28th October 2016

Updated 13 October 2016 - Poolwerx won the top title at the Australian Franchise Awards last night, with franchisee awards being spread over four different brands

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Making it easy to share information 27th October 2016

October 2016 – Lauren Taylor brings fresh energy to providing franchisors and franchisees with the information they need to build better businesses

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Restaurant Brands says 'Aloha' 26th October 2016

Restaurant Brands is looking outside NZ to Hawaii for further expansion. The company, which has the master licences for several of the Yum! Brands stable, plans to buy Pacific Islands Restaurants which is the franchisee for 82 Taco Bell and Pizza Hut stores in Hawaii, Saipan and Guam. Restaurant Brands previously acquired 42 KFC stores in Australia in April 2016. The company's agreement with Starbucks expires in 2018.

Restaurant Brands, New Zealand's largest fast-food operator with 173 stores, is expanding into new markets to drive future earnings growth, opening new burger chain Carl's Jr in New Zealand and expanding into KFC in Australia where it has 42 stores. To improve profitability in its legacy businesses, the company has been refurbishing and adding to its local KFC outlets, exiting low-performing Pizza Hut stores and closing its worst performing Starbucks Coffee outlets.

"A while ago we looked at the growth potential for Restaurant Brands in New Zealand and it was in our view limited to a steady 'business as usual' growth of one or two KFCs per year, maybe one or two Pizza Huts per year, that sort of pace. The ability to grow rapidly with new brands as we have seen with Carl's Jr is a very slow path, and there's not many other brands that we could purchase or would be interested in purchasing to add step change," chief executive Russel Creedy told NBR's BusinessDesk


NZ overtakes Singapore as best place to start a business 26th October 2016

New Zealand has been named by The World Bank as the best country in which to start a new business. It also ranked first in registering property, getting credit, dealing with construction permits and protecting minority investors. The news follows the recent World Economic Forum Global Competitiveness Report which showed New Zealand outranked Australia, China and Canada in competitiveness, but suggested infrastructure, government bureaucracy and innovation are holding us back.

World Bank chief economist Paul Romer said simple rules for doing business were a sign that a government treated its people with respect.

'They yield direct economic benefits: more entrepreneurship, more market opportunities for women, more adherence to the rule of law.'

However, in a separate article a Wellington academic has warned that 'ease of doing business does not always equate to more business.'


Women mean business <br>-Awards Preview 2016 22nd October 2016

22 October 2016 - We’re just three weeks away from the Westpac New Zealand Franchise Awards. Who will come out on top for 2016?

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Stats show which regions growing fastest as immigration drives population growth 22nd October 2016

21 October 2016 ­– Just four regional council areas accounted for over 75 percent of New Zealand’s population growth last year, Statistics New Zealand said today. Some of that growth comes from a record level of migration to New Zealand.

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Franchise confidence goes on growing 20th October 2016


Admin cut as MYOB first to launch digital signatures with IRD 18th October 2016


Number of businesses owned by women skyrockets 13th October 2016

October 2016 - More women than ever are owning and operating businesses in New Zealand, with strong performance results across the country

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NZ to cut migrant residency numbers 11th October 2016

The government has moved to make it tougher for would-be migrants to gain residency under the skilled migrant and family sponsored categories. It plans 5,000 fewer approvals over the next two years (a reduction of just over 5 percent) with the number of points required for residence under the Skilled Migrant Category be raised from 140 to 160 points.

Read our recent review of immigration trends in franchising on page 28 of our digital magazine or send fo a free print copy.

Immigration Minister Michael Woodhouse today announced that there would be fewer residence approvals planned for the next two years to 85,000-95,000, down from 90,000-100,000.

'Increasing the points required to gain residence from 140 to 160 will moderate the growth in applications in the Skilled Migrant Category and enable us to lower the overall number of migrants gaining residence,' Woodhouse said.

'Changes to the Family Category, including temporarily closing the Parent Category to new applications, will also reduce the total number of migrants being granted residence.'

Around half of those approved under the residence programme came through the skilled migrant category.


Restaurant Brands ends zero hours contracts 11th October 2016

Restaurant Brands has agreed with the Unite Union to end 'zero hours' contracts for workers at its KFC, Pizza Hut, Starbucks and Carl's Jr. outlets. The change will see workers' hours and shifts fixed, meaning that their pay should no longer vary from week to week.  The announcement is likely to put pressure on other fast food brands, with Unite specifically mentioning McDonald's and Burger King.

As of April 1, employers have been required to state any agreed hours of work in an employer's contract.  They do not have to specify any set hours if both parties agree not to.

The current Restaurant Brands collective had a formula that hours were guaranteed at 80 per cent of the previous three months staff had worked. 

The new deal guarantees hours and fixed shifts. There will be a discussion with each worker to reach agreement on fixed hours and shifts based on what they have actually been working.

Employees will also be offered additional shifts when they become available up to a maximum of 40 hours a week, allowing the opportunity to build up stable, secure full-time employment.


Franchise restraints: case-by-case approach means outcomes vary 10th October 2016

October 2016 – Deirdre Watson shares three lessons on the most recent High Court cases involving restraints of trade and good faith in franchising

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Top 10 franchises decline in US as others storm ahead 7th October 2016

The 10 largest franchise brands in the US collectively lost systemwide sales last year, after 16 straight years of gains. McDonald's was top of the list with a massive $5 billion-plus sales drop, while 7-Eleven, Subway, KFC and Pizza Hut also saw significant drops in y/e 2015 sales. However, many of these companies grew substantially outside the US, suggesting that the brands have reached saturation point at home.

The figures come from Franchise Times' Top 200, an annual report on US franchises. The news wasn't all bad, though - the other 190 franchise brands featured had an excellent year, up nearly 7 percent in what the report calls 'the best show of franchising force in 5 years.'

While year-over-year sales dropped at several leading brands, the picture brightened further down thFranchise Times Top 200 2016e list as franchised brands reached new heights with record-breaking sales, significant gains in unit counts and an ongoing push into new corners of the globe.

Outside the eye-popping declines posted by the largest brands, our Top 200+ ranking confirms that, unequivocally, franchised brands continue to grab an ever-growing share of the American economy. This year’s top 200 companies produced a combined $596.1 billion in systemwide sales during 2015.

Based on total worldwide system sales, our ranking rewards systems for how much they sell in a given year, rather than how many units they build. With Hertz dropping out of the Top 200+ and replaced by RE/MAX, the five remaining brands in the top 10 all saw healthy increases during 2015. Burger King added $287 million in new sales, Ace Hardware was up $557 million, RE/MAX added $1.18 billion, Wendy’s gained $405 million and Marriott Hotels and Resorts added $400 million to its top line.

Read more at http://www.franchisetimes.c...

Seminars – improving performance for franchisees and franchisors 27th September 2016


'Glimmer of good news' for Mad Butcher owner? 26th September 2016

A former director of Salvus Strategic Investments, which became Veritas Investments, has criticised the company for its high-risk acquisitions strategy saying there were no clear synergies between them. He welcomes some good news that the group's bankers have continued to support Veritas and suggests shareholders will be happy, but makes no forecast for Mad Butcher or Nosh franchisees.

Veritas' share price has been severely impacted by the disappointing performance of the four acquisitions. It closed the 2014 year at $1.25, the 2015 year at $0.48 and hit a low of $0.15 on Thursday.

It has subsequently recovered to $0.23 but has a sharemarket value of only $10.0m compared with the purchase price of just over $74m for the four purchases.

Ironically, the original Salvus shareholders invested $20.1m in the company and received over 80 per cent of their capital back, while Veritas shareholders have invested $25m but these shares are worth less than 20 per cent of their issued price.


Small businesses predicting bumper year ahead 23rd September 2016


What can you afford to buy in a franchise? 23rd September 2016

Before you start looking at any particular franchise, you need to know what’s possible. Philip Morrison explains how to evaluate your own financial position

Philip Morrison shows you how to examine your finances to determine the price range of franchise opportunities you can realistically consider, and how to evaluate the maximum price that you could afford to pay for a franchise

One of the results of rising house prices is that many people are using the increased equity in their homes to realise a dream and fund them into their own business. Franchises are particularly attractive to first-time business owners as they can be in business ‘for themselves, but not by themselves’. Having an established brand, proven business systems and specific training and support are all compelling reasons to choose a franchise.

Buying any business is a big decision that often requires a significant capital investment secured over the family home. It therefore demands careful scrutiny of the financial risks involved, as well as other factors such as family support, time commitment, relevant experience, your aptitude for business and your people skills.

The first step for any potential franchisee is to work out your personal equity or net worth so you can determine what franchise systems are realistically within your financial reach.

You can determine your personal equity by compiling a personal statement of financial position. This involves noting what you own – your large personal assets, such as your house or investment property – and deducting what debt you owe. The balance left over represents your personal equity. We suggest you only include assets valued at over $5,000.

In the example in figure 1, Arthur, our potential franchisee, has a house which has a current market value of $600,000, a car which has a current market value of $20,000, a redeemable life insurance policy with a current value of $10,000, and ... Read more


Business feedback sought to ACC levy changes 21st September 2016

ACC is asking New Zealand businesses to share their ideas about incentives that encourage safer workplaces and changes to ACC levies as part of a consultation process running to 19 October 2016.


Crowd-funding appeal from Aussie pizza franchisee 19th September 2016

A former Australian Pizza Hut franchisee has launched a crowd-funding appeal to fight for compensation after he claimed that price-slashing by the company caused him to have to sell pizzas for less than it cost him to make them. A previous attempt by a group of Australian franchisees to bring a class action against the company was thrown out by the Federal Court in March.

No such action has taken place in New Zealand where Pizza Hut master franchisee Restaurant Brands operates the majority of outlets itself. However, the Australian story has been repeated in the New Zealand media.

The master licence for Pizza Hut in Australia was recently acquired by a private equity firm. A different private equity firm, NBC Capital, was recently blamed for the decline of the Eagle Boys franchise by its founder, Tom Potter - see

Pizza Hut slashed the prices of its pizzas in 2014 to compete with rival Dominos, with its cheapest pizzas selling for A$4.95 (now A$5 - NZ$5.15). The cheapest pizzas currently sell for NZ$5 throughout New Zealand.

After a group of franchisees failed to get an injunction to stop the price cuts going ahead, more than 280 franchisees from across Australia began a class action against Pizza Hut's then-owner Yum Restaurants in 2015, claiming its aggressive pricing policies were forcing mum-and-dad operators to the wall.

Gordon said once wages, rent, franchise costs, royalties, marketing and delivery costs were taken into account, it cost him A$5.50 (NZ $5.67) to make a A$4.95 (NZ $5.10) pizza.

An estimated 90 percent of franchisees claimed losses and business collapses as a direct consequence of orders they slash the price of pizzas by up to 50 per cent, to take market share from rivals.

The class action, initially led by Sydney franchisee Danny Diab​, alleged unconscionable conduct under the [Australian] franchising code.

While Diab walked away from the class action, concerned for the impact it was having on his family (he declined to speak about the case to Fairfax, citing a confidentiality agreement signed as part of the settlement), the rest stayed – and lost.

Yum defended the action and in March the Federal Court threw out the class action.


Eagle Boys founder calls new owners' policies 'genocide' 14th September 2016

The Eagle Boys franchise in Australia entered Voluntary Administration earlier this year following a long period of decline under the ownership of private equity firm NBC Capital. Existing Eagle Boys franchisees have been vocal about the perilous state of their businesses. Now Tom Potter, the original founder of the business, has spoken out about the mis-management of the franchise under its new ownership and the changes it made to the core business which he said were ultimately 'genocide' to the business's franchisees. The full article makes compelling reading. (NB. the Eagle Boys operation in New Zealand was sold to Restaurant Brands in 2000 and absorbed into Pizza Hut)

He said once the new ownership and management took control they began to implement significant multiple changes to all aspects of the business along with the core marketing strategies of Eagle Boys, and in his opinion, these changes were ultimately 'genocide' to the business’s franchisees.

This included increasing prices and an attempt to re-position the company as a gourmet pizza brand, which only resulted in alienating long term loyal customers.

According to Tom, Eagle Boys’ key family target market who was interested in its $20 value meal became alienated and sales started to decline rapidly.

He explained that gourmet food is only a small percentage of the overall take-away food market at 5%, while fast food accounts for 60%, budget food 25% and QSR (Quick Service Restaurants) 10%.

In Tom’s eyes, another major mistake that the new Eagle Boys management made was replacing its ‘2 minute guarantee or it’s free’ commitment by watering it down to ‘2 minute express when it’s available’, and discontinuing the marketing altogether, which resulted in stores falling behind the expected standard and customers waiting longer.


What's next for The Coffee Club? 6th September 2016

The Coffee Club's master franchisees in New Zealand are looking at bringing in two more brands in 2017. The Groove Train and Coffee Hit are both sister franchises owned by The Coffee Club's Australian owner. Since it opened its first NZ store in 2005, The Coffee Club has been hugely successful here, with its 60th store about to open.

The Groove Train is described as an "urban dining experience" (think gastro bar), while Coffee Hit is an upmarket roasted coffee café (think Mojo).

[Master franchisees Brad Jacobs and Andy Lucas] have got an agreement in principle from the franchisor but are still assessing local franchisee demand for the more expensive The Groove Train which would have an upfront cost of about $1 million. They're also looking for suitable locations within shopping centres to get it started.

They've just signed another 10-year franchise with Minor DKL for The Coffee Club and plan to expand the chain to around 93 stores within the next seven to 10 years, mainly in regions outside of Auckland where most of their stores are based.


Another Mad Butcher store faces liquidation 6th September 2016

The Inland Revenue Department has filed an application to liquidate the business behind the Silverdale Mad Butcher store, the latest issue to hit the franchisor, NZX-listed hospitality company Veritas. The store was relocated in 2012 from central Orewa, where it had traded successfully for 12 years, to the still-growing Silverdale shopping precinct.

Veritas chairman Tim Cook said the company had been advised of the IRD action by the franchisee in Siverdale.

No outcome had been determined and wouldn't be until the hearing on Friday.

''Tax is a personal matter between the franchisee and IRD and as such neither Veritas nor Mad Butcher have any comment to make,'' Cook said.

''Once any outcome is known Veritas/Mad Butcher will determine what is required going forward.''


Women-only gym to go 24 hours 6th September 2016

Configure Express is set to introduce 24 hour opening with small Configure gyms to feed into the larger outlets. The announcement follows a number of closures and a split which has seen the four former Configure outlets in Wellington re-branding.

Configure Express managing director Greg Peters said gym requirements were changing and his business was following global trends.

People wanted shorter contracts and better availability, he said.

"The gym market has changed since we first set up and we were going in a different direction than other gyms."

Overseas the trend was for smaller gyms to feed into bigger gyms and he planned to open Configure 24 hours gyms to work alongside the Configure Express franchise.

There was still a market for female only gyms but his business had to make changes to be successful.

In some areas it was not possible for the gyms to follow the new direction, which led to closure and splits, he said.


Women-only gym franchise splits 30th August 2016

A group of women-only gyms in Wellington has split from the national Configure Express franchise. While both sides have insisted the split was 'amicable', neither will comment on the reasons behind it, citing a confidentiality agreement. In a statement, Configure Express says the move to 'part ways' was in the best interests of both companies.

The four former gyms on Willis St, Lambton Quay, Lower Hutt and Upper Hutt, have now rebranded as Revive Fitness.

Lambton Quay Revive Fitness general manager Sheree Cooper would not say why the company had left the franchise, citing a confidentiality agreement.

It would be business as usual for the gyms and members, she said.

Members were under contract with the owners of the gym and not the franchise, so their contacts would not change, she said. If they wanted to remain with the Configure franchise, she said members should speak to her on an individual basis.


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