Gastronomic franchises stand out within the resumption of the premium sector
- August 3, 2022
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Companies bet on new product lines and the combination of physical and digital sales
The resumption of face-to-face activities and circulation in shopping malls and high street stores have been benefiting franchises, as recent data from the sector show. Those dealing with higher value-added products follow the pace of recovery, even in a challenging macroeconomic scenario.
Owner of the Grand Cru wine store chain and the Evino ecommerce store, the holding Víssimo Group has registered an increase in demand both in physical and digital stores, which has given breath to new investments.
The group predicts for 2022 the sale of 20 million bottles, with revenues of R$ 800 million. In 2021, the International Wine Organization recorded that Brazil was one of the countries where consumption grew the most, with an increase of 18.4%.
“Consumption continues to grow and there is still a lot to grow, but we are no longer limited to wine”, says Alexandre Bratt, executive director of the Víssimo Group.
The plan, according to him, is to increase the stores’ portfolio with matching kits and other products related to gastronomy. Other bets are on multiple sales channels, with the digitization of Grand Cru stores and also the opening of the first physical store of Evino, scheduled for the second half of 2022.
According to Bratt, the franchising model should not lose ground, as stores link e-commerce to the physical experience. Customers can, for example, pick up a product purchased via the internet at one of the establishments.
The Grand Cru brand has 120 stores throughout Brazil, 103 of which are franchises. The forecast is to open 35 new establishments in 2022 – the investment in a brand franchise starts from R$ 300 thousand.
Also in the gourmet sector, a very specific niche was the choice of São Paulo entrepreneur Raphael Mazzon: fine artisanal cookies for gifts. Owner of ten Biscoitê franchises in the capital and in the interior of São Paulo, he was attracted by the novelty for having little competition.
Created in 2012, Biscoitê registered its biggest expansion in the middle of the pandemic, when it went from 3 to 40 stores. Last year, it grew 297% in sales compared to 2020, reaching a turnover of R$ 40 million.
With an average ticket of BRL 55 and gift baskets that can reach BRL 350, the brand began its expansion in malls aimed at consumers with higher purchasing power and high street stores, and is now starting to reach shopping centers more popular.
The investment in a brand franchise ranges from R$150,000 to R$390,000, depending on the format (cart, kiosk or coffee shop), with monthly revenues starting at R$60,000 and reaching R$120 thousand.
Return deadlines range from 18 to 24 months — the first store opened in 2018 by Mazzon, in Campinas (São Paulo countryside), returned in just one year, but it was a pre-pandemic scenario.
Founder and CEO of Biscoitê, Raul Matos bet on the segment after working in the food sector. He became a partner in a company that produced cookies for major brands, at which time he traveled to more than 30 countries to get to know this market and seek recipes. “Brazil is one of the three largest markets for cookies in the world, but it lacked products with greater added value.”
In addition to packaging that guarantee the appeal for gift giving, one of the differentials, according to Matos, is the constancy of novelties. Biscoitê launches 140 products a year, including sweet and savory cookies that honor countries. Panettone and Easter eggs also make the list.
The chain expects to reach 60 franchises and earn BRL 70 million by the end of the year, an increase in revenue of 75% compared to 2021.
The entrepreneur looking to invest in premium product franchises must map the brand’s target audience, in addition to betting on a privileged location. In general, however, the business model is not so different from the others, according to André Friedheim, president of ABF (Brazilian Franchising Association).
For the franchising consultant Ana Vecchi, the market for high-end brands requires a franchisee with a less operational and more managerial profile. It is the entrepreneur who is rarely seen in the store, but is behind the scenes, keeping an eye on accounting and customer feedback on the shopping experience.
“Premium brands attract an investor profile that identifies with the brand and its universe, often being a customer”, he says.
In the luxury sector, as a rule, international brands aimed at the public with higher purchasing power look for a strategic partner with local knowledge. Iguatemi SA, a holding company that owns high-end malls, has a business unit, iRetail, especially dedicated to bringing luxury brands to Brazil.
The company has seven brands in its portfolio with exclusive physical stores in the group’s malls: Balenciaga, Birkenstock, Christian Louboutin, Goyard, Missoni, Polo Ralph Lauren and Vilebrequin. It also represents other brands that are sold on the Iguatemi 365 marketplace.
According to Catharina Palmer Pereira, general manager of iRetail, this consumer is more resilient in uncertain or crisis periods, which means that sales are not so affected by instability. “This made the pandemic bring opportunities. As Brazilians could not travel, several brands had record sales performance in the national territory in the period.”
The brands do not disclose revenue or growth percentage, but Iguatemi shows performance recovery in relation to the pandemic period, according to Catharina.