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Why this South African fast-food brand is expanding to America

In four years Chesanyama has grown to 300 outlets in South Africa, making it one of the country’s fastest growing food franchises.

In four years Chesanyama has grown to 300 outlets in South Africa, making it one of the country’s fastest growing food franchises.

Chesanyama (meaning ‘braaied meat’ in isiZulu) is a South African fast-food franchise brand built on the concept of the traditional township braai (a South African-style barbecue). It was started in 2012, and today has grown to around 300 outlets in South Africa, making it one of the country’s fastest growing food franchises. It also has a presence in Southern African countries such as Mozambique, Zimbabwe, Zambia, Botswana, Lesotho, Namibia and Swaziland and has recently announced its plan to expand to the US.

While the agreement is still being finalised, Praxia Nathanael – co-founder of Chesanyama and CEO of the brand’s holding company Gold Brands – expects the deal to be concluded within a couple of weeks for the establishment of a US-based Chesa Nyama Holdings. This will be formed through a partnership between Gold Brands (which will hold 30% of the shareholding), US-based The White Family Group (30%) and South African industrial holdings firm Red Hornbill (40%).

If all goes according to plan, the first Chesanyama store will open before the end of October in Nashville, Tennessee.

It’s all in the name

Chesanyama was started by Nathanael and her husband Stelio after selling their previous take-away franchise, The Fish & Chip Co, to Taste Holdings in 2012. It started under the name Butcher’s Grill, with three stores, but gained little traction.

“And then one day Stelio visited a township with one of our employees and when he came back he said to me, ‘You know what, I’m going to change the name and call it Chesanyama, which means braaied meat’,” recalled Nathanael.

“So we changed the name to Chesanyama and from there it just took off.”

Towards the end of 2012, the duo decided to set up their central kitchen to prepare and supply their franchisees with their own meat products and flavours in order to have a better control over costs and quality.

Since then Gold Brands have gained four other restaurant franchises and, in February, it listed on the Johannesburg Stock Exchange. Gold Brands is also finalising a deal to bring a UK fish and chips franchise brand, Harry Ramsden’s, to South Africa.

Part of Chesanyama’s growth has been on the back of catering to local tastes at affordable prices. For example, meals are served with a side option of pap (a traditional staple food made from maize) and relish while burgers start at R20 (US$1.30). Nathanael noted the brand has between 50 to 60 signed applications to open new franchises in the country, as well as other African markets.

And with the development of the company’s food production arm, Gold Brands is also looking into opportunities to supply retailers.

“We have our sauce factory, we have our spice factory, we produce our own meat spice and all our own sauces come from our head office. So what we are looking at doing is going more into the retail segment with our existing brands and products.”

Taking on the US

Gold Brands was approached last year by American businessman Ray White, who heads The White Family Group, about setting up Chesanyama in the US.

“He was very keen on taking South African traditional meals to America so he presented a business plan to Stelio and myself, and we agreed,” explained Nathanael.

She added that in Tennessee alone there is an estimated population of around 250,000 South Africans – making it a good state to begin expansion in.

However, the brand will also be targeting Americans and Nathanael explained that market research showed that brisket is the most popular cut of meat in the US. “And that is exactly what we are serving our customers daily in South Africa.”

She added that while the menu might be tweaked to cater for American tastes, it will still feature its traditional meals as demand for African dishes grows – especially among the African-American population.

“Just by what we have been told about some of the due diligence that has been done… to open 2,000 stores isn’t big for America. For us that is huge but to them it is doable,” highlighted Nathanael.

“So what we have decided is to open the first few and see how it goes and how well it is received by the American public. But we believe it will do really well.”

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