5 November 2018

Southern Africa: Nando's Withdrawal From Namibia Unexplained

Photo: Nando's
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Windhoek — Popular South African fast food franchise, Nando's, known for its peri-peri chicken and some of the most hilarious and proactive advertising in this part of the world, has packed up and left Namibia.

"To confirm, Nando's have closed franchise branches in Namibia. At this stage we cannot provide further details, however, we are considering future plans to re-enter the Namibian market," was the brief response by Darren Hampton, from Nando's South Africa, to a list of questions New Era sent him last week.

His statement confirmed news that the chicken franchise, famous for infringing on KFC's dominant market position a few years after it was founded in Johannesburg in 1987, disappointed many of its die-hard followers when its famous red and green logo was nowhere to be seen in the country as of last week.

This left many Nando's customers up in arms as there was no prior announcement of the departure.

Instead, what greeted customers at their usual Nando's outlets was a new local franchise named Grill Addicts, who invited customers to try fast food that is 'just as good'.

Grill Addicts is owned by the Haramse Business Trust, run by Rupert Haramse, and has extended the fast food range from just chicken to include meat, sausage and sauces.

The Haramse Business Trust held the franchise rights for Nando's in Namibia. Although Rupert Haramse was unavailable at the time of going to press, his friendly receptionist telephonically confirmed the Trust had 'given the Nando's franchise back to South Africa'.

No information could be obtained regarding the impact of the withdrawal on Nando's Namibian staff or whether Grill Addicts has offered them jobs.

Also, not much is known about the Haramse Business Trust besides that a few years ago it took over a previously closed seafood outlet, Ocean Basket, and then revived its presence with initial shops at the Grove Mall, Kleine Kuppe and another at Town Square in Windhoek's central business district.

As an international franchise, Nando's is doing remarkably well and is making significant inroads into Asia, Europe and the Middle East. From its humble beginnings in Gauteng, the franchise now operates over 1 000 outlets in 35 countries and still has a strong presence in the southern African region, including South Africa, Botswana, Zimbabwe and Zambia.

It is estimated that an investment in new Nando's franchise can run up to N$6 million, comprised of a franchise fee of N$220,000, restaurant design and set-up of N$1,3 million, design and project management of N$430 000, shop fittings of about R1.1 million, kitchen equipment of N$1.3 million, fixtures and fittings of N$1.2 million and point of sale and computers of about N$315 000.

Despite the persistence of tough economic conditions in the region, franchising has remained resilient and has typically shown positive growth rates, according to Sybrand Bezuidenhout, a business development manager for franchise services at the Barclays Africa Group in South Africa. In a recent interview with Business Tech, he noted that this is particularly true for the franchising services category, which comprises 27 percent of the total franchising industry and has a combined turnover in South Africa alone in excess of N$133 billion per annum.

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