Shock executive shake-up at RFG
THE boss of struggling Gold Coast franchisor Retail Food Group has left the company.
In a statement to the ASX, RFG said managing director Andre Nell would be replaced by the group’s Australian chief executive Richard Hinson.
Mr Hinson was appointed in January as reports of a crippling franchise model destroyed the company’s share price, which has been in steady decline, punctuated by sharp freefalls, since December.
It has shed 81.6 per cent of its market capitalisation in five months – from $804.1M to $148 million.
Former Metcash executive Mr Hinson was tasked with leading implementation of the company’s strategic business review, to “simplify” the group’s operating model, and to improve the sustainability and performance of RFG’s franchise network.
The group said Darren Dench would stay on as chief executive for its Di Bella Coffee brand while Peter McGettigan would be chief financial officer.
“Managing Director, Andre Nell, will leave the Group on 29 May 2018,” the statement said.
“These management changes demonstrate the Board’s commitment to closer integration between head office, support structures and RFG’s franchise network.
“Richard Hinson and Darren Dench are focused on improving performance of RFG’s core domestic franchising and global coffee businesses, and their leadership has made a significant positive impact on the business in challenging retail trading conditions.”
The statement said the group had delivered franchisees reductions in cost of goods, renewal and new store fees, and worked with franchisees to pilot innovative new store concepts — however franchisees say the changes do not go far enough.
RFG said the senior executive team was “committed to working closely with franchisees on a range of performance improvement initiatives, including new product range and quality, supply chain improvements, a group customer loyalty program, and other promotional activities.”
In the ASX statement, Mr Hinson described the group’s core business as “fundamentally sound”
“We are revitalising the network to focus on our customers first; improving performance, driving innovation and improving communication and transparency with our franchisees,” he said. “This is a 12- 18 month turnaround of the RFG business.”
Chairman Colin Archer said Mr Hinson was “gaining the confidence” of franchisees.
“Our core brand systems are in good hands under the leadership of Richard, Darren and Peter, and we are seeing early signs of improving performance,” Mr Archer said.
“On behalf of the board, I would like to thank Andre for his dedicated service to Retail Food Group in a range of senior executive roles since 2007, and wish him well for his future endeavours.”