Spur sees boost in sit-down trade as lockdown restrictions ease

Spur, the popular food franchise company, has reported a significant boost in sales growth as lockdown restrictions eased in South Africa, allowing for a return to normal sit-down trade. The company's CEO, Val Nichas, shared that the market opening up and customers returning to their favorite spots played a significant role in the positive results. Additionally, internal initiatives such as offering everyday value, special campaigns, and special offers, along with exploring other channels like Takeaway and VK Brands, have all contributed to the impressive performance announced in the latest financial results. While these initiatives did not directly impact margins, the company did provide support to franchisees during challenging times, which temporarily affected profits. However, Nichas emphasized that the return on investment is crucial for sustaining business operations and that the company had sufficient cash reserves to weather the storm. Looking ahead, Nichas expressed optimism about a potential return to normalcy for the brands that are performing well, with the Spur brand being closest to achieving this goal. While some brands may take longer due to varying consumer demand and market penetration, the overall outlook is positive if current trends continue. Despite the overall positive performance, there were some challenges in specific regions. The Australia-Austral Asia region experienced a decline in sales, leading the company to reevaluate its presence in the market and shift its strategic focus. The company's ongoing relationship with third-party delivery aggregators like Uber Eats and Mr. Delivery has been essential, particularly during lockdown periods when dine-in options were limited. While these services come at a higher cost, they have enabled Spur to tap into the takeaway market and sustain sales. Looking at future growth opportunities, Nichas highlighted the Spur and RocoMamas brands as significant contributors, especially with RocoMamas' expansion plans. Additionally, the company is eyeing growth in Africa, where its brands resonate with consumers, as a key international growth area. The rising trend of vegan and vegetarian options in the industry has also caught Spur's attention. While they acknowledge it as a niche category, the company has ventured into plant-based offerings, particularly through the Mud Rockers concept. Nichas expressed confidence in the future of this category and emphasized the importance of catering to changing consumer preferences around wellness and sustainability. Although still in the early stages, Spur is committed to exploring and expanding its vegan offerings as part of its overall growth strategy.