Fast-food giants no relish for investors
Low returns on capital almost certain to leave shareholders reeling
All bets are off as to whether SA is still a fast-food nation as the country's biggest fast-food groups battle stagnant consumption. "The idea that fast food was bulletproof had its kinks," said Carlo Gonzaga, the former CEO of Taste Holdings. "If the listed numbers are not great, then the privately owned businesses are on aggregate worse. They're small, can't deal with the shocks and aren't as well funded. Three or four years of pressure on disposable income has taken its toll." Food retailing is intensely competitive as consumers struggle in a weak economy. But even so, more people than ever are buying ready-made food. Famous Brands, which owns Wimpy, Steers and Debonairs, using the All Media and Products Survey, commissioned a study called "The Hunger Games" that found that in 2016, the take-up was 82% - up from 70% a decade earlier. Former Famous Brands CEO Kevin Hedderwick has previously spoken of the potential of the fast-food sector, as consumers were increasingly "cash-rich ...
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