FIFI PETERS: David Shapiro from Sasfin Securities and I could possibly be a laughing concerning the vegan development, however it’s definitely not with out promise of actually nice returns. Well-known Manufacturers this morning got here out with an fascinating assertion. That is the franchiser whose manufacturers presently embrace Debonairs, Steers and Fishaways. Well-known Manufacturers was saying its foray into the vegan and the vegetarian market. It’s a in style development proper now, and has grow to be much more in style with an increasing number of of us changing into well being aware. As I stated, it appears to supply profitable returns.
How Well-known Manufacturers is doing that is it has purchased a majority stake into an organization referred to as Lexi’s Wholesome Eatery. It is a vegan-focused restaurant, a gaggle that additionally provides plant-based meals to different eating places, in addition to different retail shops. Now we have the co-founder of Lexi’s, Ezio Nichele, with us on the Market Replace.
Ezio, congratulations on the deal. Inform us extra about this enterprise that Well-known Manufacturers is taking a chew from.
EZIO NICHELE: Okay. Thanks very a lot, Fifi, and I respect your invitation. Lexi’s Wholesome Eatery was began on my own and Lexi [Monzeglio] in 2018. We obtained collectively in the beginning of 2018, and we mentioned a couple of concepts about making a plant-based vegan restaurant. I wished to go full vegan restaurant, and Lexi satisfied me to not go full vegan however be extra open to everyone, like attempting to draw people who aren’t essentially 100% vegan.
FIFI PETERS: Like me and David [Shapiro].
EZIO NICHELE: Precisely. Properly, David is a handful. [Chuckling]. Now we have a few choices that aren’t vegan, and so we’re not strictly vegan, and we don’t ever say we’re vegan, however we do prefer to be as vegan as attainable and we like to draw the vegan clientele clearly. We’re doing this for the vegan, to open everyone’s thoughts to the vegan way of life and habits.
FIFI PETERS: Positive. Discuss to us about this clientele and what number of extra of us, significantly right here in South Africa, are contemplating this route – simply based mostly on the variety of folks strolling in into your eating places.
EZIO NICHELE: Properly, the clientele is sort of small, however you’d be stunned how the spectrum truly goes throughout fairly a couple of fields. We all know it’s not solely [for] the vegan, however it’s additionally [for] people who find themselves attempting to reside a more healthy way of life. So individuals who go to health club, who run, who cycle, who play sports activities, we entice them as properly as a result of they realize it’s like clear meals. It additionally attracts people who find themselves gluten-intolerant. There are a variety of gluten-challenged folks. Most of our menu is gluten-free, so it opens as much as them as properly.
After which people who find themselves diabetic or have coronary heart situations. It opens as much as lots of people who’ve sure ways in which they need to eat. So it’s not solely the vegans, however it’s a wider spectrum of individuals.
FIFI PETERS: All proper. Obtained it. You clearly caught the attention of a bigger participant out there, within the type of Well-known Manufacturers which has purchased a 51% stake in your enterprise. Inform us why you stated sure to that deal, and what Well-known Manufacturers is bringing to the desk.
EZIO NICHELE: In 2018, when Lexi and I met, one of many first conversations we had was like, ‘The place will we need to be in 5 years’ time or 10 years’ time?’ Each of us we would like a plant based mostly eatery throughout South Africa, nationwide. We don’t need one restaurant. We don’t need two eating places, we would like a number of eating places. We need to expose this type of eating-habit way of life to many individuals throughout Africa. That was our first dialog.
From the beginning we wished to develop, we wished to go massive.
Instantly what involves thoughts is Well-known Manufacturers as a result of they’re the consultants on this subject. They’re the largest meals group. They know all about franchising, they’ve obtained the infrastructure, they’ve obtained the know-how, they’ve obtained the finance, the HR, the distribution chains. So instantly we thought they’d be the very best associate.
Clearly we had been a bit scared as a result of they’re very meat-orientated, however for us it’s additionally a possibility to say, okay, let’s attempt to associate with Well-known Manufacturers, even when they’re very meat-orientated, and let’s present them that there’s meals apart from meat and rooster and cheese. Hopefully we will open up their minds as properly and alter a bit the way in which they’re doing enterprise.
FIFI PETERS: Fairly inspiring.
EZIO NICHELE: It goes to extra than simply meals. It’s the plastic, it’s the carbon-neutral sustainability.
FIFI PETERS: Fairly inspiring, the ability of a imaginative and prescient and the significance of figuring out the place you’re going from the get-go. Since 2018, give us a way of the income and the revenue development that you just’ve skilled.
EZIO NICHELE: Okay. That is an fascinating one, as a result of we’ve been via some fascinating occasions.
FIFI PETERS: Lockdown – not with the ability to go to a restaurant?
EZIO NICHELE: That was horrible for us. We went via a variety of ache. In 2018 we opened up and inside the first three weeks that we had been open we had queues exterior our eating places at lunchtime in the course of the week, Monday to Friday, working queues. It was going very properly. The earnings weren’t precisely there, as a result of we had been nonetheless attempting to create the title and we weren’t trying on the bills that properly, however we had been going properly. Ultimately we caught some folks’s eyes and we managed to open up the second department in December of 2018, in Modderfontein as a franchise, and we concerned as a three way partnership a really small minority associate.
Then in the beginning of 2019, we noticed The Zone at Rosebank, and we liked it. We utilized for a store there and we opened that one in July, 2019. That simply took off. The numbers we had been doing there have been unbelievable. It was an actual hype. Individuals had been loving it. We had been [doing] mainly full breakfast, lunch and supper. The Zone was superb. [Pre-]Covid was superb as properly. So it was a extremely nice space and issues had been actually booming.
After which March 2020 got here and that reduce our legs massively. We went via a variety of ache.
We nonetheless managed to open up a franchise retailer in June 2020, in Pretoria, which was behind the ‘boerewors curtain’; everyone stated it’d by no means work in Pretoria. It truly labored out so properly, as a result of it’s such an excellent store. It’s truly our busiest retailer in the meanwhile. It’s actually stunning. It’s massive, double story, it’s superb. It’s in Hazelwood, it has this container vibe. It’s actually nice. That’s a franchise retailer, a 100% franchise retailer. We’re not companions there in any respect. Then in December, 2020, we opened up in Sea Level, Cape City, which additionally took off rather well.
So we’ve been on upward development, even via Covid. We’ve managed to remain alive, and no matter there may be, however we fought arduous and the landlords have been excellent to us. The banks have helped us out as properly. However I’d say extra the landlords actually did assist us out.
FIFI PETERS: How a lot did the 51% stake price Well-known Manufacturers?
EZIO NICHELE: Properly, for those who ask Well-known Manufacturers, it price rather a lot, and for those who ask us it didn’t price sufficient.
FIFI PETERS: [Laughing] I see you might be properly skilled to reply that query. Wow. Good on you.
Only a parting shot – what is going to your function be? Yours and Lexi Monzeglio, who my producer Kaldora has informed me truly used to work at Moneyweb. So congratulations to her. However what is going to your function be on this new construction with Well-known Manufacturers as a associate?
EZIO NICHELE: We’re nonetheless the administrators, along with different administrators from Well-known Manufacturers. We’ll tackle the lead. We’ll tackle the technique. Lexi will nonetheless develop the menus. She’s the face behind the model, the menu growth, and the artistic across the model. I’m extra on the operations/admin aspect of issues, however we’ll each be very, very concerned with the entire technique of the centre kitchen, opening new shops, creating the QSR [quick service restaurant] idea. We actually need to take this into retail as properly, make it inexpensive for everyone.
FIFI PETERS: All proper. I’ll look ahead to attempting you guys out. I definitely will make a go to to one among your eateries. However congratulations to each of you. We must go away it there. Ezio Nichelle, the co-founder of Lexi’s Wholesome Eatery, becoming a member of us on the story relating to Well-known Manufacturers’ acquisition of a 51% stake within the enterprise.