Friday 26th September 2014
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Burger Fuel Worldwide, the NZAX-listed fast food chain franchisor, plans to bring its franchise stores in-house which it expects will deliver greater profitability, and has bought the Henderson, Auckland store for an undisclosed sum.
The Auckland-based fast food chain is targeting at least a 20 percent return on investment from its company-owned stores, and is considering opening its own restaurants in selected locations in New Zealand, before taking the format overseas, it said in a statement. As part of the plan, Burger Fuel bought the Henderson store from the current franchisee, Mike Jury, with ownership changing hands from next month.
“We’ve put many years into developing an extremely successful business model which makes strong profits for our franchisees and we’re increasing the number of company-owned stores in order to meet some key objectives," chief executive Josef Roberts said. "We have strong cash reserves and no debt, as well as the management to facilitate key Burger Fuel restaurant purchases and to launch new sites."
At the start of this year, Burger Fuel raised $5.9 million from US investor, Franchise Brands, to help fund its global growth aspirations, including plans to reach into the world’s biggest economy.
Burger Fuel said it plans to keep most of its stores as franchises, while pointing to the global trend of listed food companies owning at least a quarter of their restaurants.
"All our international license agreements going forward will allow for us to own and operate a percentage of restaurants within franchised territories," Roberts said.
Shares of Burger Fuel rose 1.9 percent to $2.75, and have jumped 69 percent this year.
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