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Today's Top Entrepreneurship and Business Stories (17 August)

Today's Top Entrepreneurship and Business Stories (17 August)Famous Brands’ Performance Declines On Lower Consumer Confidence

Famous Brands said on Wednesday that trading conditions in the South African market declined further for the first six months of the financial year in light of continued economic pressure on disposable income and sustained socio-political uncertainty.

This is despite Famous Brands increased system-wide sales in South Africa by seven percent while like-on-like sales grew by 1.8 percent during the five months under review. Famous Brands will publish its results for the six months ended 31 August in October.

System-wide sales refer to sales reported by all restaurants across the network, including new restaurants opened during the period while like-on-like sales excluded new restaurants.

The group owns Wimpy, Mugg & Bean, Europa, Tasha’s, Steers, Debonairs Pizza, Fishaways, Milky Lane, The Bread Basket, and many other restaurants.

The chain restaurant owner said consumer confidence remained at low levels both in South Africa and in the rest of Africa and Middle East region, under-performing management’s expectations.

In the United Kingdom market, Famous Brands said consumer confidence declined in the context of increasing political uncertainty surrounding Brexit negotiations and recent terror attacks and the general economic slow-down featuring rising inflation and limited wage increases.

Competition in the trading landscape also intensified and supply currently exceeds demand, resulting in the recent closure of several competitor branded food businesses.

Famous Brands opened a total of 52 restaurants in South Africa, eight in the rest of Africa and Middle East region, and six in the UK. The Group’s entire network comprised of 2,801 restaurants as at 31 July 2017.

The group said it anticipates that trading conditions in its local and international markets will remain challenging for the coming year, reflected by constrained consumer demand and intensified competition. (via African News Agency)

Opportunities Abound For Foreign Investment In Africa’s Hospitality Sector

The hospitality sector in Africa’s emerging markets looks set to profit from foreign investment and an influx of foreign travellers. The emerging markets are set to post faster growth in revenue than their counterparts in developed countries, making them integral to the expansion strategies of some of the world’s leading hotel developers.

Pietro Calicchio, Hospitality & Gaming Industry leader for PwC Southern Africa says: “The growth potential of Africa is high mainly because of the rapid economic growth in some economies, a growing middle class and an increase in visits from foreign visitors.

“The emerging markets are a sought after destination for foreign investors – it is in these markets where there is continued economic growth and a need for additional infrastructure. In addition, governments and policy makers are introducing a range of tax incentives and other incentive schemes to foreign investors.”

Although the potential for foreign investment has improved substantially in Africa over the past several years it is not without a number of challenges. Some of these challenges include a drop in oil prices and other commodities, social unrest, unstable electricity supply and the impact of one of the most severe droughts across the African continent.

Direct Pay Online Group acquires Virtual Card Services (VCS) South Africa

Direct Pay Online Group (DPO) has today announced the acquisition of Virtual Card Services (VCS) South Africa. This marks the completion of DPO’s purchase of VCS Group, post the earlier acquisition of VCS Namibia and VCS Botswana. Furthermore this acquisition further bolsters DPO’s leading position in Southern Africa post its previous acquisitions of PayThru and PayGate.

VCS has over 20 years of experience in developing and implementing credit, debit and smart card processing systems for major card issuers in South Africa. DPO plans to merge both VCS SA and PayThru, which it acquired last month, with PayGate to create the leading Payments Service Provider in South Africa.

Direct Pay Online Group CEO, Eran Feinstein said: “We are excited to finally have VCS South Africa on board. By merging VCS and PayThru South Africa with PayGate, we will be able to position ourselves as the largest PSP in Africa serving over 20,000 merchants. With every acquisition we make, our merchants across the continent benefit by receiving an unparalleled offering of services and geographical exposure. I believe we are well on our way to providing one payment solution across Africa.”

Virtual Card Services was established in 1996 to offer a solution to the mail order market that found conventional methods of securing large volumes of credit card payments cumbersome and costly. The business rapidly grew by expanding its scope of services to organisations requiring automated, high volume and secure credit card payment processing. Today, VCS South Africa serves thousands of merchants across South Africa including University of Johannesburg, Club Med, Capetown Cycle Tour, TourvestGetwine and Thompsons travel, all of whom will continue to unmatched services and dedicated support.

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