Coffee brands boost Retail Food Group sales

Retail Food Group sales boost
Coffee has helped drive sales growth for RFG (Source: Gloria Jean's/Facebook)

Multibrand food-chain franchisor Retail Food Group (RFG) says all of its brands enjoyed positive same-store sales growth in the December half.

The company owns and operates Gloria Jean’s, Crust Gourmet Pizza, Donut King, Brumby’s Bakery, Cafe2U Michel’s Patisserie, Pizza Capers and The Coffee Guy. 

For the six months, same-store sales (SSS) grew 17.9 per cent compared to the previous year, boosting underlying earnings before income and taxes to $13.7 million.

Among the group’s portfolio, Donut King was a “standout” performer contributing 40.7 per cent of SSS growth in the half aided by a 32.5 per cent increase in customer count and average transaction value.

The US a new target for growth

Its international division – Master Franchise Partners (MFPs) and Di Bella Coffee – contributed $2 million to EBITDA and added 44 new outlets in the half.

RFG expects to open another 35 units in 2H23.

In the US the first of three new Gloria Jean’s drive thru outlets was established in Texas.

RFG executive chairman, Peter George promised a greater focus on US network growth with a target of more than 100 outlets within a three year period.

QSR brand launched

The company also launched a new concept, Rack ‘em Bones BBQ Ribs, leveraging its existing QSR outlets and maximising profitability. 

George, said “A simple, low-cost business model that affords opportunity for incremental sales growth whilst avoiding potential cannibalisation of existing QSR Division sales and menu, Rack ‘em Bones BBQ Ribs has been successfully trialled across 11 outlets during FY23, with trial outlets experiencing average weekly sales growth of $3,500 during the trial period.”

The rollout of Rack ‘em Bones BBQ Ribs franchises contributes to the pipeline of 33 new stores and RFG has approved 23 new franchise partners.

Retail Food Group focused on growth and profit

Peter George said the group’s coffee brands enjoyed a significant ‘bounce back’ post-Covid as customers returned to normal shopping routines.

“We remain focused on delivering solutions for our franchise partners to unlock growth and drive profitability. 

“This focus has led to a range of initiatives, including virtual brand extension, the ongoing cost of goods review, menu optimisation, pricing evaluation and RRP review to offset inflationary pressures, marketing  investments and the implementation of a new e-commerce platform in the second half to improve customer experience and functionality.”

The company resolved court proceedings brought by the Australian Competition and Consumer Commission (ACCC) in late December agreeing to pay certain franchisees $8 million and waive franchisee debts of $1.8 million.

A version of this article was first published on sibling website Inside Retail.