ABC is one of the best-known and most successful quick-service restaurant brands in South Africa, with a noteworthy presence in a highly competitive fast-food market. But where does its story begin?
Its popularity and success centres on providing a range of flame-grilled and value-for-money hamburgers to the consumer, while offering prospective franchisees the opportunity to be part of a lucrative franchise through its holding company, FB.
Where does the story of ABC start?
The history of the company revolves around the Halam family, whose family members are still part of the executive team today, with extensive experience in the food and franchising industries.
ABC founder, Geo Halam had a vision to create a successful family-run business and the idea for ABC originated while he was on holiday in the United States where he came across innovative food industry concepts and ideas. He decided to bring these new food industry methods to South Africa, which was the starting point for the creation of a brand that would grow from strength to strength.
Uncle Geo, as he was affectionately known, created the original Milky ice cream parlours, followed in quick succession by the first South African steakhouse (the Rosebank Golden Spur), the Seven Steers steakhouse in Highlands North and the Black Steer in Yeoville in the early 1960s. He was also one of the first entrepreneurs to bring the franchising concept to South Africa.
After Uncle Geo died in 1984, leadership of the chain passed to his nephews Peter, Theo and their brother, Perry, as well as to Uncle Geo's youngest son, John. The three brothers had all been operating their own franchises and John was operating the manufacturing business, supplying ABC outlets and other retailers. Together, they re-engineered the brand and actively sought new franchisees. The early 1980s saw the opening of ABC in Sandton City, which attracted
interest from would-be franchisees, and this encouraged the team behind ABC to launch their franchise programme.
There seemed to be no shortage of prospective franchisees wanting to buy into their franchise model, and more than 15 ABC outlets had opened within two years, with this number growing to 250 stores 10 years later.
By the end of the 1990s, ABC started expanding beyond South Africa, and outlets opened in Swaziland, Botswana, Zimbabwe, Kenya, Mauritius, Zambia, Tanzania, and Ivory Coast. The name ABC evolved over the years too, starting with Golden Spur, then changing to Seven ABC, followed by Branded ABC and Longhorn ABC, before becoming ABC.
ABC Holdings listed on the Johannesburg Stock Exchange in November 1994, and in 2001 changed its name to FB. This reflected the diversity of the FB group portfolio, although ABC remained the icon brand within the group.
The brand has continued to prosper and currently has over 546 ABC restaurants worldwide. By attracting new consumers as well as increasing the consumption frequency of existing customers, ABC succeeded in reaching its target of double digit system-wide sales growth in 2012. Innovating to suit customer needs The ABC burger range is dominated by 100% pure beef burgers, and all food is freshly prepared in each restaurant. ABC supplies the core hamburger ingredients, including buns, patties, and sauces, to all its franchisees through FB Services and approved suppliers. To keep their brand innovative and to cater for a variety of customer needs, ABC extended their range to include breakfast burgers, flame-grilled beef and chicken burgers, as well as vegetarian and Halaal options.
New on the menu today...
To stay competitive and in tune with customer needs, the ABC menu has to remain innovative with its offerings, and they operate various promotions including their well-known 'Wacky Wednesday'. To broaden their customer base, they actively target the children's market (three to eight year olds) with their ABC Brat Pack meal, which offers a specially packaged, single serving child's meal, and a gift to go with it.
ABC identified a lucrative gap in the 12 to 18-year-old age group market, and to target this market they released a series of catchy adverts for their 'Hoohah' campaign. This 'teens and young adults' group is a large market, which has gained global attention as a prime marketing target. This group is often bombarded with the latest trends in fashion, entertainment and technology, and interaction with this sector demands a relevant message and a unique offering geared to the group's particular likes and trends.
Another development in the brand's stable of restaurant concepts is the ABC Diner. In an agreement between ABC and ZAP, the ABC Diner offers a take away option, or a fully serviced seating area for sit-down meals at selected ZAP garages which are strategically allocated along several major driving routes around South Africa. There are currently 31 ZAP Ultra City sites in South Africa, of which 29 of them have ABC Diner Restaurants on site.
Staying innovative, in 2012, the first 24-hour new-look ABC drive-thru was launched in Krugersdorp. This new concept drive-thru allows customers to watch their burgers being flame-grilled without customers having to leave the comfort of their cars.
ABC has combined the guidance of a strong and highly experienced leadership team, with a popular franchising model to become the South African fast food franchise success story it is today. The ABC vision of creating and offering customers the perfect burger has made it successful over the years, and by mastering the art of consistency and staying true to their distinctive flame-grilled taste, and the unique seasoning on their hand cut chips, they've been able to maintain their unique selling proposition.

 

Question 1

Businesses can pursue several strategies to achieve growth and grow sales.
Taking cognizance of information contained in the article, use the Ansoff growth matrix to analyze ABC's aggressive stance. Make use of information from the article to support your discussion.