8 September 2017
Burger King conquers Belgium
Finally Belgian burger lovers can treat themselves to a Whopper. Burger Brands Belgium, who already owns the Quick franchise, plans to quickly establish a strong presence in Belgium and Luxembourg. With the help of a new form of partnership with ING.
Visiting the Burger Brands Belgium headquarters in Wilrijk can be quite disconcerting: nowhere else in the world will you find Quick and Burger King logos, posters, menus and paraphernalia side by side – or nearly – on the walls or decorating the same open space. "At least from now on I won't have to hide when I indulge in a Double Whopper," jokes Kevin Derycke, CEO of Burger Brands Belgium. More seriously, Derycke"s success story with Quick in Belgium is probably the very reason Burger King trusted him with the Master Franchise for the brand in Belgium and Luxembourg. "It did not happen on a whim. We had to go to them and to convince them we could turn the Belgian market into a success story. Our track record with Quick helped us to win the argument. We have demonstrated that we have the expertise, not only in franchising and business development, but even more importantly, in the fast-food sector."
An Expert Player
Neither Burger Brands Belgium, nor Kevin Derycke, are beginners. Kevin Derycke started his career as an assistant manager in a Quick restaurant. In 13 years, he made his way up the company, first in Belgium, then in France. "When Quick restaurants was sold to Groupe Bertrand in 2015, they decided to convert the French market to Burger King and divest the Belgian market. I was sent back to Belgium to help with the sale. Kharis Capital, the investment fund which bought the Belgian arm of Quick, asked me to stay as the CEO. When Quick Belgium and Luxembourg was sold to Kharis Capital, we had 101 restaurants in our portfolio, both franchisees and managed by the company. Now, Burger Brands has 60 employees working at its headquarters. Currently we employ a staff of 3500 in our network, 20% of them in our own restaurants. This was, of course, very reassuring for Burger King."
Two competing brands? Not a problem, quite the contrary!"Both brands have room for growth"
Doesn't it look odd that the same company manages franchises for competing brands? "It is true that we are the first in Belgium to do so. The only other Belgian franchiser with two brands in its portfolio is Top Brands: they manage the Pizza Hut and the Paul franchises, but these are hardly on the same market," Kevin Derycke admits. "That being said, both Quick and Burger King are strong brands with a large fan base. Moreover, the Belgian market is hardly saturated: disregarding Quick and McDonald"s, there are no other fast-food franchises. It"s probably due to the difficulty of the Belgian market, with its three regions and three languages. Besides, our Quick franchisees are happy with our decision, and that means a lot to us. Some of them will convert their restaurant to Burger King, but better still, others have chosen to open new restaurants and operate both brands. This means they feel the same: both brands have room for growth." Jüry De Wulf, CFO of Burger Brands agrees. "The results from our first openings are very encouraging: turnover has far exceeded our expectations."
A Win-Win-Win Partnership
To help new franchisees set up shop and existing franchisees expand or transform their existing Quick restaurant into a Burger King, Burger Brands Belgium has negotiated a new form of partnership with ING. "Basically our franchisees are entrepreneurs and they are very good at what they do," says Jüry De Wulf. "Nevertheless our experience has shown that there is often a communication problem between franchisees and banks. Since we consider it part of our duty to help franchisees in any way we can, we decided to address that issue. ING was proposing a new kind of partnership that seemed to be the kind of solution we were looking for: a framework agreement between Burger Brands and ING regarding the funding of a new restaurant or the conversion costs of an existing Quick into a Burger King. Provided an investment meets the criteria we agreed on with ING, it will fast track the franchisee"s loan application."
Passing on knowledge"This framework agreement makes the whole process speedier and more predictable"
"What makes the framework agreement possible is that we have a very good relationship with Burger Brands," says Jan Van den Bergh, Franchising Expert at ING Belgium. "We know their track record, and we know how serious they are when selecting candidates for new franchises. Moreover, they can lend extra credibility to the information provided by franchisees. Which means our business desks have far more information and a lot more reassurance than what they would if a franchisee came to them on its own. In other words, everybody stands to win from the framework agreement: the franchisee can secure a loan in an easier and quicker way, ING has the certainty of high-quality debtors, and Burger Brands can strengthen the support they give to their franchisees." Kevin Derycke and Jüry De Wulf agree: "Our aim is to do our utmost to help our franchisees focus on what they do best: opening and managing fast-food restaurants. This deal offers real added value. Our franchisees have given us very positive feedback to date. This framework agreement makes the whole process speedier and more predictable. As we are involved from the outset, we can help answer any questions the bank may have, and hence it helps the franchisee to secure financing faster than on his own."
Ambitious Growth Plans
This partnership will certainly help Burger Brands Belgium meet their ambitious growth plan. "We have already opened a restaurant we operate ourselves in Luxembourg," Kevin Derycke details. "Three franchisees we already work with have opened a restaurant: in Antwerp, Charleroi and Namur. The next opening will be in Brussels. In total we are counting on 7 to 10 new openings a year in Belgium. We are confident: there is enough unmet demand on the market to keep us busy for the coming years!"