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Gary Alford talks acquisitions

Sarah Stowe

Retail Food Group is acquiring again, adding to its coffee profile with Cafe2U now officially part of the business and the deal with casual dining’s Italian restaurant chain La Porchetta scheduled for an October completion.

“Any acquisition is driven by a number of factors, our prime consideration is synergy in the current group,” says Gary Alford, director of franchise.

Bringing in Cafe2U builds on the coffee roasting and general expertise in coffee, he explains. “It is another coffee outlet. We’ve mapped the territories and we see larger scoop for further enhancement of the brand.”

Alford says that one state in danger of being overlooked is WA, and this is a target market for the brand, as are regional areas around the country.

The acquisition of Cafe2U includes the overseas businesses – there are 11 units in New Zealand, 62 in Great Britain, the US has 5 units, and there is one in South Africa. “One of the key drivers for international expansion is having the supply lines in place,” says Alford.

These new members of the group join other former independent businesses Pizza Capers and Crust Gourmet Pizza Bars. Will there be more acquisitions?

“We have made no secret that we are an acquisitive group. The truth is there is still a lot of opportunity there and as a large group we have our door knocked weekly.”

On the other hand, there are no plans to divest any of the brands, Alford says.  That leaves RFG as not just a large franchisor group, but one with an extensive portfolio of brands, possibly unmatched, and room for more.

There are dangers in accruing multiple brands, Alford admits. So the approach to shaping today’s acquisitive group has been long-term.

It all started in 2006 with the decision to consolidate the sector. The first stage was acquiring Michel’s Patisseries in December 2007.

“One thing from that acquisition was that we recognised the risk then.  We spent time restructuring the business and the brands.

“Beforehand each system shared platforms, afterwards they became silo brands. Each one has an MD, full operations and marketing teams, and support. As long as we have the management structure and systems, it works.

“The brand has to make sense, we have to add something to the business, and they have to add to the group,” he says.

“If it’s in food, and it needs systems and processes, then we’re interested.”

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“Whenever you are doing something that is not core business, you need to have structure in place, to manage and grow the business.

“For us it was making sure the brands were mature enough – that the business is stable, financially secure, and has strong management.”