RFG director taking on operational role
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Retail Food Group director Jessica Buchanan has resigned from her position in order to transition to an operational consulting role.
The move, announced in a statement to the ASX on Thursday, will enable Buchanan to execute some of the strategic initiatives she has helped to formulate in her capacity as a director.
These include a strategy for the rollout of 62 new product campaigns, which are now being delivered to franchise partners by the company’s brand general managers.
The first of these campaigns are showing significant improvements, a company spokeswoman said.
According to RFG, the new Gloria Jean’s ‘Kit Kat Chiller’ promotion so far has lifted sales by 9 percent, and the Brumby’s ‘Gourmet Donut’ campaign has lifted sweet category sales by 8 percent.
Buchanan, who founded consumer research agency Consumerology, which counts Autograph, Katies, Millers, and Crossroads as clients, has many years of experience in consumer product marketing and retail franchising.
She was also a non-executive director of Banjo’s Bakery Cafes for four years from 2008 to 2012, according to LinkedIn.
Earlier this month, The Age and The Sydney Morning Herald reported that Buchanan had sought to stock products from Naytiv, a food brand she started in 2017, in some of RFG’s franchises.
“She was also a non-executive director of Banjo’s Bakery Cafes for four years from 2008 to 2012, according to LinkedIn.”
The company ultimately decided not to move forward with the idea, according to a statement given to the publications.
“Jessica has served on the RFG Board for eight years and as we close out the end of another financial year, she has decided the best use of her time at this point is to step into the company and commit more of her time to help drive the successful execution of these campaigns for our franchisees,” the spokeswoman said about her transition to operational consultant.
RFG executive chairman Peter George thanked Buchanan for her contribution as a director and said he looks forward to working with her as a contributor.
“Innovative product offerings and campaigns will be critical to the revitalization of the RFG’s franchisee network which will, in turn, underpin the operational turnaround of RFG,” he said.
The franchisor, which owns the Gloria Jean’s, Donut King, Crust, Pizza Capers and Brumby’s Bakery businesses, has faced ongoing challenges since it got caught up in the parliamentary inquiry into the franchising sector.
In March 2018, the company revealed plans to close more than 200 stores and posted a $306.7 million loss later in the year, after it was forced to make impairments and provisions to the tune of $402.9 million to cover store closures and restructuring and a reduction in brand value and assets.
Over the last 12 months, RFG has renegotiated its financial covenants with lenders, gaining some breathing room while it seeks to reduce debt levels, including the potential sale of its Crust, Pizza Capers and Donut King businesses.
The company’s stock price spiked in early July after it received a $160 million refinancing proposal subject to various conditions from Soliton Capital Partners, which it did not make public despite the ASX’s continuous disclosure rules.
The company defended this decision, citing the fact that it has said numerous times that it is exploring various ways to reduce its debt.
Questions & Answers
Q.What is the primary reason for Jessica Buchanan's move from director to an operational role?
What is the primary reason for Jessica Buchanan's move from director to an operational role?
Jessica Buchanan is transitioning to an operational consulting role to execute strategic initiatives she helped formulate as a director. These include a strategy for rolling out 62 new product campaigns to franchise partners.
Q.What evidence is there that the new product campaigns are performing well?
What evidence is there that the new product campaigns are performing well?
A company spokeswoman stated the first campaigns show significant improvements. The Gloria Jean’s 'Kit Kat Chiller' promotion increased sales by 9 percent, and the Brumby’s 'Gourmet Donut' campaign lifted sweet category sales by 8 percent.
Q.What challenges has RFG faced recently?
What challenges has RFG faced recently?
RFG has experienced ongoing challenges since the parliamentary inquiry into franchising. This led to plans to close over 200 stores and a $306.7 million loss due to impairments and provisions for store closures and restructuring.
Q.Which of RFG's businesses might be sold to reduce debt?
Which of RFG's businesses might be sold to reduce debt?
RFG is considering the potential sale of its Crust, Pizza Capers, and Donut King businesses. This is part of its strategy to reduce debt levels after renegotiating financial covenants with lenders.
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