Mad Butcher boss: We lost friends

Morton says sale to Veritas didn’t go as he’d expected

Long-time butcher boss Michael Morton says the Mad Butcher lost friends during its six years owned by public company Veritas Investments.

Mad Butcher is again family-owned after Morton and partner Julie Leitch, daughter of founder Sir Peter Leitch, bought back the business from Veritas for $8 million — a fraction of the $40m the NZX-listed company purchased it for in 2013.

Leitch and Morton each have a 50 per cent shareholding in the company.

Morton was chief executive of Mad Butcher under Veritas’ ownership. He was its largest shareholder and served on the its board until June this year.

At the height of the butcher chain’s success there were 40 stores. Today, there are 29.

Morton said the sale to Veritas had not gone as he had expected. “It wasn’t what I thought it was going to be. There were growing pains as we went and sometimes we were growing for the sake of growing,” he said.

“I thought we could sell it and I’d exit out of the business but that hasn’t been the case and I think we have something to prove again with the business, which is why we bought it back.”

The franchisor business was sold to Yogg Limited in December 2017.

Veritas shareholders ap- proved the sale of the business and its assets at a meeting in Auckland in March this year.

The change in ownership enables the brand to focus on long-term growth as opposed to short-term growth, he said.

“Being a public company and a private company, there’s a different vision. One is all about profit now and a private company has a longer-term idea of profit and sustainability,” Morton said. “We’re

Being a public company and a private company, there’s a different vision. Michael Morton

going to take a very long-term approach and work back in with the franchisees.

“We were friends with all of the franchisees previously, and the same with all of the suppliers, a lot of that went under the public company.”

Morton said he hoped to restore the brand to what it was, and to expand the number of stores nationwide.

“I want to get growth back into the brand and then look to expand it again. We want to get back to the community spirit that we used to do.”

He said working under Veritas had taught him a lot.

“I hadn’t been part of a public company before, I learned a lot of things and the demands of being a public company, but I do really enjoy private company ownership . . . because sometimes you can try and make decisions to suit the market rather than the right thing to do for the brand.”

Morton said there were several reasons franchisees went under during Veritas ownership, citing competition, tighter margins and supply issues.

“We are competing everyday with what a farmer can sell overseas for — it’s very much that Fonterra-type model.”

He said consumers would be paying between 20 and 30 per cent more for their meat at supermarkets if its stores were not around.

First Retail Group managing director Chris Wilkinson said the Mad Butcher brand had been severely damaged and it would take a lot to restore its reputation. “The only saviour will likely to be active reengagement and commitment by Peter Leitch — back fronting promotions, supporting the business network and steering the group’s future,” he said.

“Consumers — and commercial stakeholders — will be expecting this.”

Wilkinson said reverting to a “back to basics” approach is imperative for the chain if it is to restore confidence.

“Mad Butcher needs to look at how it can again stand out now the market has become even more crowded and competitive . . . it needs to find a new and audacious ‘edge’ in the marketplace.”