- 20 July 2021
in 2011 and early 2012 i was residing in a near CBD suburb ( in Brisbane ) and got to observe several RFG franchisees regularly ( every time i went to the local shopping area and other nearby ones )I agree. Is an establishment fee of $600,000 normal for a commercial $20 million debt facility? It seems like management is desperate to bolster their dwindling cash reserves and these kind of deals make me think that management think the worst is yet to come.
RFG was down to around $24 million in cash at the end of 2022. With interest rates on the way up and a pessimistic outlook for the Australian economy RFG looks to be battening down the hatches in anticipation of a rough ride ahead.
I've never liked this company or its business model and I honestly can't see it staying in business long term. It's franchises seem very 20th century to me and haven't adapted to a changing retail environment. When was the last time anyone went to Donut King or Michel Patisserie? It isn't 1990 anymore.
Good luck to holders, but I wouldn't touch RFG with a barge pole.
the hot bread kitchen( bakery ) seemed to be the only franchise with a persistent customer base , that was 2011 i wonder what the 2023 economy looks like in the same area
BTW i went to physio today and heard about two renters ( different households ) hit with more than 30% rent increases in the same week ( one household is moving , the other in shock and exploring options ) , one might wonder if discretionary sending is liable to have a headwind