AT THE end of last year, Sarel Cilliers signed a lease on a retail site 135m² in size.

MICHAEL BLEBY

The site in Nelspruit’s Plaza Centre, opposite the police station and next to the taxi rank, was well-suited for a passing trade of foot traffic, but was bigger than he needed.

“When I got it, the landlord said ‘That’s the space available’,” the businessman recalls.

“I said ‘It’s too big’. He said I must come up with something else.”

Mr Cilliers opened a Debonairs Express pizza outlet in May. He then phoned Famous Brands CEO Kevin Hedderwick and told him he needed another business to use up the remaining space.

Mr Hedderwick told him to hang on, as he was in negotiations about a possible answer.

“My own franchisee network — 1

“There’s no way a KFC or Nando’s was going to extend a franchise to a Famous Brands franchisee because they’re in competition.”

The answer was made public yesterday, with the announcement that Famous Brands will buy and expand Giramundo, a tiny Johannesburg-based chicken business.

Mr Cilliers’ site in central Nelspruit, along with a similar one in Kokstad in KwaZulu-Natal, will now become one of the first two new Giramundos. While three of the four existing outlets are in townships, Giramundo will be marketed in the middle-class market too.

Still, as the Giramundos stores target high foot-traffic areas, they are smaller in size than eat-in and drive-through restaurants, and cheaper to start up.

In comparison with the R2,5m R3m it would typically cost to start a Nando’s or KFC restaurant, the roughly R1m price tag of a Giramundo store would make them accessible to emerging entrepreneurs, Mr Hedderwick said.

“We will have a high incidence of existing franchisees buying in, but I do believe the price is such that it can offer a very attractive entry level business for (black economic empowerment) franchisees.”

Source: Business Day