Johannesburg - After two years of negotiations, Famous Brands [JSE:FBR] on Tuesday announced it has signed an agreement with French bakery-café chain PAUL to become its South African licensed partner for a ten-year period.
In terms of the agreement, Famous Brands will open five restaurants over a five-year period in three trading formats. The first flagship PAUL restaurant is scheduled to open by the end of 2016.
PAUL is a 126-year-old family-owned French chain of bakery-cafés with an international presence in 41 countries in Europe, Africa, Asia, America and the Middle East. PAUL serves over five million customers a month in its 400-plus bakeries across France.
According to Famous Brands Group CEO Kevin Hedderwick the partnership is aimed at enhancing Famous Brands' premium-end offering.
"While PAUL's product offering is classically French, it also brings innovation and continuous development of new products," he said.
Hedderwick said PAUL's authentic offering - served in its trademark chic restaurants - will have enormous appeal for discerning local consumers who are increasingly aligned with international trends and choose to associate with brands with style and status that are popular in Europe and the US.
He explained that these days eating out is about the experience, and brands that differentiate on an experiential platform continue to perform strongly. There is also a growing demand for premium offerings and customisation - both aspects PAUL caters for in his view.
“Research confirms the continued growth in this country of the higher LSM and middle income market, with consumers constantly looking to indulge in premium brands that offer quality.
"Buying into an international brand of this calibre will afford us access to all the global learnings and best operating practice that has been developed," said Hedderwick.
Famous Brands will also have direct access to PAUL’s marketing and operations expertise and new product development and training facility in Lille, France.
Maxime Holder, president of PAUL International, said "PAUL, like Famous Brands, is a family business and our entrepreneurial cultures are aligned”.
He said Famous Brands can in the longer term provide PAUL with access to African countries outside of South Africa where the French chain is not currently represented.