Global coffee chain Gloria Jean’s will close up to 25 of its 400 Australian outlets by the end of March as it quits corporate-run stores and becomes a franchise-only business

Michael Bleby Reporter

Gloria Jean’s to close 25 outlets in switch to franchise-only model

Published 17 February 2014 11:10, Updated 17 February 2014 11:58

Global coffee chain Gloria Jean’s will close up to 25 of its 400 Australian outlets by the end of March as it quits corporate-run stores and becomes a franchise-only business.

The coffee chain’s move comes after it was acquired in December by ­Singapore-listed Global Yellow Pages, a database and directories company that is expanding into food and beverage and wants to expand the Gloria Jean’s brand into China. It already exists in ­39 countries.

The planned expansion of the coffee chain that has about 800 stores throughout the world means it can no longer focus on owning and running stores, executive ­chairman and ­co-founder Nabi Saleh said.

“Owning retail property ourselves is a distraction from our primary ­business strategy,” Saleh told The Australian Financial Review.

“By March 31 our goal is to either have all these coffee houses ­successfully franchised or closed.”

Gloria Jean’s has corporate-run stores in five Australian states.

The company says it is too early to say which stores would be closed or how many stores could be converted into franchises.

“We are currently in talks with a number of potential franchise partners some of which are already deep into the training process,” Saleh says.

Under the cash-and-shares deal, for which GYP raised $S62.9 million ($55.3 million), the company took ­control of all Gloria Jean’s Coffees and It’s A Grind intellectual property, the global supply chain operations, and the master ­franchisor business for all ­Gloria Jean’s Coffees coffee houses throughout the world.

Saleh, the non-executive ­chairman of the newly formed ­GYP-owned holding company for the Gloria Jean’s business, retains interests in the master franchisee business of ­Australia, USA and China.

 

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Kee Koon Boon (“KB”) is the co-founder and director of HERO Investment Management which provides specialized fund management and investment advisory services to the ARCHEA Asia HERO Innovators Fund (www.heroinnovator.com), the only Asian SMID-cap tech-focused fund in the industry. KB is an internationally featured investor rooted in the principles of value investing for over a decade as a fund manager and analyst in the Asian capital markets who started his career at a boutique hedge fund in Singapore where he was with the firm since 2002 and was also part of the core investment committee in significantly outperforming the index in the 10-year-plus-old flagship Asian fund. He was also the portfolio manager for Asia-Pacific equities at Korea’s largest mutual fund company. Prior to setting up the H.E.R.O. Innovators Fund, KB was the Chief Investment Officer & CEO of a Singapore Registered Fund Management Company (RFMC) where he is responsible for listed Asian equity investments. KB had taught accounting at the Singapore Management University (SMU) as a faculty member and also pioneered the 15-week course on Accounting Fraud in Asia as an official module at SMU. KB remains grateful and honored to be invited by Singapore’s financial regulator Monetary Authority of Singapore (MAS) to present to their top management team about implementing a world’s first fact-based forward-looking fraud detection framework to bring about benefits for the capital markets in Singapore and for the public and investment community. KB also served the community in sharing his insights in writing articles about value investing and corporate governance in the media that include Business Times, Straits Times, Jakarta Post, Manual of Ideas, Investopedia, TedXWallStreet. He had also presented in top investment, banking and finance conferences in America, Italy, Sydney, Cape Town, HK, China. He has trained CEOs, entrepreneurs, CFOs, management executives in business strategy & business model innovation in Singapore, HK and China.

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