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Start-up costs:

News Cafe: R6m, 50% must be upfront. Then you pay 9% of turnover in franchise fees. Average profit is R250k/ month

Cubana: startup costs of R10m (without booze) & then 8% of revenue. No profits figures disclosed.

Cubana is the more expensive joint to own.
Does News Cafe spread themselves too thin? The downside of diversification is the time you can focus on one asset/ brand.

News Cafe belongs to Fournews. Fournews brands include Moyo, Brooklyn Brothers, Soul Souvlaki, Hello Tomato.

Cubana is independently owned by Greg Reimao.
News Cafe has more branches (23) & operates across Africa. Botswana, Kenya, Tanzania, Namibia.

Cubana has fewer branches (15) & is a SA business. This makes it easier to react to changes.

News Cafe may also have a concentration problem with chains cannibalising each other.
Relative price points are a HUGE factor in a cocktail lounge.

Despite being frequented largely by students, News Cafe drinks list (one in black) is more expensive than Cubana.

An Absolut cocktail comes in at 90 bucks while Goose is 79 bucks. Long Island's also more expensive.
Cubana has found a way to squeeze juice out of higher margin value offerings like VIP areas & hookah pipes.

Hookah is one of the only instruments in society that facilitates the introduction of 23yo marketing students to married, overweight 57yo guys with terrible cholesterol.
SERVICE!

The single biggest determinant of whether someone returns to your establishment depends on how well you treat them.

As expected, cocktail bars hardly get blowout rating, although there is a recurring theme of News Cafe being slower at the bar + slower with food.

[END]
Shout-out for making it to the end.
We stay killing it 💪🏽💪🏽
Useful links:

Franchise costs:
businessinsider.co.za/how-much-it-co…

News Cafe Franchising:
newscafe.co.za/news-cafe-fran…

Cubana Franchising:
cubana.co.za/4179-2/
These figures would have moved a bit - will refresh them. Still a decent starting point into the world of franchises (top-line ++ start-up costs).
The Famous Brand [Thread] outlining how difficult it can be to run multiple brands under one portfolio (like News Cafe are currently doing).
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