How will new CEO Brett Houldin handle the challenges of fast food franchising?
He’s just two weeks into the role but he’s not new to the business. Houldin has been with the company for two and a half years, on the Board, a chief operating officer and chief financial officer, working on a succession plan with outgoing CEO Rob Coombes, now chairman.
Houldin has a finance background but hasn’t limited himself to dealing with monetary aspects, taking on HR, legal, IT, supply chain and special projects.
Previously general manager of hotel and entertainment complex The Star, Houldin brings a clear hospitality focus on the customer.
“What I saw in the strategy at QSRH was clear focus, digital technology, and a great loyalty program. I have a passion for digital and did an e-commerce degree when it was very new.
“I led the introducton of online ordering at Red Rooster. I was able to understand the landscape, how the customer engages on that level.”
So what are his views on running a franchise business?
1. Franchisees are partners
Houldin started his tenure in much the same way he conducted his other roles at QSRH, he says – on the road, meeting with franchisees. “I’ll be taking all the time I need, we’re in this together, it’s a strong partnership,” he says.
2. The spotlight is on team work
“I put a huge focus on people and seeing them develop and grow.
“My leadership style is very open and collaborative. I like to make sure we have the right people on the journey to get to the milestones. That’s how I operate and engage with franchisees, crew and head office.”
3. Workplace compliance is a must
“You need to be always on the right side of compliance, ensuring your franchisees are administering the stores as they should. We are running a robust program that satisfies us we’re in good shape.
"We take workplace compliance seriously. We complete both internal and external audits, we are rolling out biometric log-ins to monitor staffing, and we get the metrics via a standardized time and attendance system.
"We also have an internal whistleblower hotline. We're on the front foot, we're proactive and we will continue to be so.
“We already benchmark to Fair Work expectations of franchisors. While it’s early days, we feel we are taking steps to make sure franchisees adhere.
"When you get into a franchise, you've got to do what's right for the customer, the employees and the brand as a whole."
4. Customers want convenience
Momentum has been focused on the home delivery channel with a Red Rooster rollout; now Oporto and Chicken Treat are trialling this.
“Chicken is the most favoured protein but the least delivered. We’re coming third in deliveries after Domino’s and Pizza Hut, and our objective is to be number two.
“The customer wants fast, fresh and real value.”
5. Look to overseas opportunities
The company expects to launch into two Asian markets by the end of the financial year 2016.
“It’s where chicken is a protein that’s widely consumed and the flavours and spices of Oporto in particular we expect to do well. We want strong partners with retail, food or property experience.”
Two or three new markets a year is the ongoing target with master franchisees the preferred expansion model.
6. The future is more than chicken
The future is all about convenience, Houldin predicts. And that means some additions to the portfolio. “We’re a house of brands,” he says.
Australian brands will be a target for acquisition. “We own all of our brands and that gives us a lot of flexibility and we can operate in certain ways.”
QSRH in the future will not just be all about chicken. “There are different segments within the chicken market, we would consider future complementary products, target markets and synergies that will add value to the portfolio.”
Houldin is confident that once the company re-capitalises (private equity owner Archer has the company on the market) there will be the opportunity to add more brands.
7. Facing up to fast food challenges
Houldin highlights product relevance and a focus on quality, freshness and convenience, all delivered by QSRH he says.
There are newcomers in the casual dining sector too, increasing the competitiveness of this market.
Across the group, over 15 new drive-through restaurants will open next financial year.
“We’re targeting of over 30 new store openings next year. Our focus is on franchising and we expect less than 10 company owned stores trading by June.”
8. Customer engagement
It all comes back to the basics of engaging more customers more frequently, whatever the channel.
Think smaller scale footprints. “In Sydney our brand is well known but we have 2 million people who can’t access it. Smaller stores in highly urbanised areas do well,” says Houldin.
So expect to see more of Oporto’s Pequino and Red Rooster Reggies outlets dotting city centres.
Drive-through has been the foundation on which Red Rooster built its brand – there are now 350 such stores across Red Rooster and Oporto.
“We have an amazing portfolio, drive-through, counters and home delivery," says Houldin.
