RBD - Restaurant Brands

[Snoopy]

quote:Originally posted by Halebop


Snoopy wrote:

For KFC customer service, scores on the CHAMPS scale *have* been improving. The figures for the last six years are from FY2000 to FY2006:

93.2%, 93.0%, 92.0%, 89.0%, 95.4%, 95.5%

95.5% is better than anything achieved in any state of Australia
Note: this is not hype Halebop! There has been a real measurable turnaround in years 2005 and 2006.

'CHAMPS', BTW is a rigorous six scale quality control scheme. The CHAMPS acronym stands for in order:

Cleanliness, Hospitality (Say 'Great to see you' and smile at the customer), Accuracy (correctness of order), Maintenance, 'Product Quality' and 'Speed with Service' (hint: only open the drive through window once with product in hand ready for the customer).

Snoopy I'm quite famililar with Champs, with the process measurements involved and with several pertinent restaurant formats, including 2 out of 3 of RBDs. 95.5% is not a good score. It might read good on the outside, but it aint. Conversely 89% is a Sh!t score.

I guess a KFC restaurant could could be perfect on 5 out of six of the champ categories, yet muck up 30% of processed orders by missing a piece of chicken out of them. Such a restaurant would annoy the hell out of customers, yet still end up with a CHAMPS score of 95%.
And customers make negative judgements on restaurants by their mistakes. So a 95% CHAMPS score could still mean commercial suicide.
(Is that the kind of thing you mean Halebop?)

quote:
Snoopy wrote

Get real Halebop. Some of these employees might only be on $6,000 per year total. A free gym membership isn't going to pay their bills for them.

Get real yourself Snoopy. Everything is scalable. That was an example.

That's where yo are wrong Halebop. It is all very well offering gym packages to middle management. Workers at the bottom of the pay heap need all of their pay just to survive. So cutting their pay by $5 per week and giving them a $10 voucher for a single gym session as compensation is an extremely negative result for a low paid worker, despite them being better off 'in dollar terms'.

quote:From p23 of the RBD FY2006 annual report:

"In conjunction with New Zealand Hospitality Standards Institute we have developed a tailored training cirriculum called 'Future 2 Go' which we offer through all of our stores. This earn as you learn training is base don a modular building block approach that enables learners to progress from one qualification level to the next at their own pace. Competancy at each level is recognised with a National Certificate in Hospitality and often results in staff promotion or advancement."

And the PR firm edited out the next lines... "We are so successful at the stragegy, staff turnover has fallen to 71%. In any case we benchmark against world worst practice to makes ourselves look good so what the hell."
[/quote]

As '95663769' has pointed out:

"From stats nz ... The accommodation, cafes and restaurant industry had the second-highest average quarterly worker turnover rate of all industries, with average quarterly worker turnover rate of 28.2 percent, higher than the all industries average of 17.4 percent."

The hospitality trade annual labour force still 'employed rate' is:

(1.000-0.282)^4= 26.6%.

That means on average 73.4% of workers have 'turned over' during the year. Rather more than the 71% turnover from KFC. KFC are now 'better than average' aft

[BRICKS]

quote:Originally posted by BRICKS

DONT worry boys the s/price will soon back over $1 those poor soles who dumped over 2 million of there hard earned shares at such a big LOSS will then regret while the traders CHEER.. [8D]

BET all you HARD talkers did not BUY or SELL note that Winger69 never DOE`S.. [8D]

[Snoopy]

quote:Originally posted by winner69

For what it is worth

From stats nz ... The accommodation, cafes and restaurant industry had the second-highest average quarterly worker turnover rate of all industries, with average quarterly worker turnover rate of 28.2 percent, higher than the all industries average of 17.4 percent.


If i understand the workings properly thats an annual turnover rate in excess of 100% ... well done KFC

Before Enumerate lambastes you '95663769', I will do it. This is another example of 'geometric averages' after successive trials (to use the statistical jargon).

The hospitality trade annual labour force still 'employed rate' after four successive quarters is:

(1.000-0.282)^4= 26.6%.

That means on average 73.4% of workers have 'turned over' during the year. KFC is better than this average, but not by all that much. Nevertheless for a national chain the KFC's 71% staff turnover figure is a creditable result.

SNOOPY

[duncan macgregor]

quote:Originally posted by moimoi

i suspect the landlords are on their knees praying RB doesn't fall over....Having witnessed the auctioning off of the properties...and watching the punters climb over each other to buy them on a 4.5%-7% yield...they'll need the rent.

dunno quite who you would lease an empty KFC store too.?
[]moi.

Let us look at this from the landlords point of view, presuming that you are right with your figures. Lets say the average store at 6pc yeild which is a bit to low at the start making the initial purchase not an outstanding investment. Then along comes RBD and upgrades the place by $830000 whoopee look at what the place must be worth now. Remember RBD still pay the outgoings you still get your rotten 6pc but further down the track look at the capital gain. Well done landlords, you are on to a winner when this lot go under, or get taken over, which must happen, you are in the box seat. SNOOPY you should have bought the place with those shares of yours. macdunk

[Pennywise]

dunc, you not making a sense mun

what value is there to "KFC" style improvements to a building that will not have ANY value to the landlord if they run the lease course, just like the old buildings, eventually they need doing up again and again.

they have locked in LOW yeilding rents for the landlord and since the landlord didn't pay for the these improvements, there will be no improvements based rental increases. If the lease clauses are based on inflation, then what chance does the landlord have of increasing rent in the near future? rent improvement percentages only apply if the landlord paid as far as I know.

your assumption seems based only on the chance that if KFC fell over tomorrow and the landlord took over the building, they would get a huge rent jump from a new leasee.
their is no value to the landlord if KFC improvements run their full use by date, 10 years or more

being out of property right now in the current cycle and at yeilds under mortgage rates...seems to me RBD are winning here.

[duncan macgregor]

PENNYWISE, It is only speculation on our part what the benefits or losses to the landlord might be. Lets look at it from all the angles using figures that have been banded about. If RBD goes under, the landlord has a building renovated at an average cost to the tennant $830000. Part of that sum would be RBD chattels but a large part according to SNOOPY is that they renewed and up graded the building. The building is now in a far superior condition with a larger long term capital gain. The landlords upkeep is reduced to nil in the short term, the idiot tennant has renewed it at their expence. The capital gain on a newly renovated property is far greater than a property due for maintanance. The landlord initially was happy with a six pc yeild plus a capital gain. When the lease expires or gets renewed the rent is based on the value of the property excluding tenants chattels. RBD has placed the landlord in a strong position to up the rent in the future. If the land lord decides to sell the building, i would gaurantee that they would now make a decent profit. I only wish that i had known about this in advance i would be delighted with a six pc yeild under those conditions. It definately beats having shares in the company. macdunk

[winner69]

Duncan .... its $1M a store .... from RBD announcement .....Restaurant Brands plans to spend a further NZ$8 million on 8 stores by the end of the year.

[winner69]

Question 766679 ... I take it RBD would have had to front up with some dosh for the new franchise agreements on 44 KFC stores ... and some more dosh next May for the other 33 KFC stores and all the PH stores.

Any ideas how much? ... wasn't stated in the announcement

[Happy Camper]

quote:Let us look at this from the landlords point of view, presuming that you are right with your figures. Lets say the average store at 6pc yeild which is a bit to low at the start making the initial purchase not an outstanding investment. Then along comes RBD and upgrades the place by $830000 whoopee look at what the place must be worth now. Remember RBD still pay the outgoings you still get your rotten 6pc but further down the track look at the capital gain. Well done landlords, you are on to a winner when this lot go under, or get taken over, which must happen, you are in the box seat. SNOOPY you should have bought the place with those shares of yours. macdunk

Unless RBD are overnight paying increased leases on the renovated premises then the fact that RBD have spent millions of dollars on building refits means little to the value of those commercial buildings. A large part of assessing the value of a commercial property is based on the lease income. Often a "fancy-pants valuer" will try to justify the value based on some other criteria, but at the end of the day it always comes back to a yield against lease.

There will be no capital gain on these commercial properties for landlords to bank unless the lease income from these properties increase. And somehow I think RBD will have protected their position to ensure leases don't go through the roof.

And as for RBD going under, that opens a whole new kettle of fish. Try being a landlord of one of those properties then! Your relationship manager at the bank will be pushing it uphill to convince the credit manager that there is any lending value in the property if there is no lease in place.

As an aside snoopy, I know that private equity ran the ruler over RBD last year, and deemed north of $1.60 too expensive. What chance of private equity determining that the numbers stack up now? You would have to assume that they could get their first 20% at a weighted price of around $1.10.

Cheers

[Pennywise]

quote:Originally posted by duncan macgregor
If RBD goes under

there is no point discussing any further the value of building improvements to landlords unless you are convinced of your above "IF'

my opinion, fat chance [pun intended]