Gami Chicken is targeting 15 per cent year-on-year in-store revenue growth, is on track to grow to 42 locations by the end of 2023, and has grand plans for 2024.
Jun Lee, Gami Chicken’s executive director, said “In 2023, the dine-in category made up 54.7 per cent of our in-store revenue composition, followed by delivery at 30.7 per cent and takeaway at 14.6 per cent.
“If we continue to follow this trajectory of dine-in revenue across the majority of our stores, in addition to our franchise expansion, we’ll be able to move towards a $60 million business by 2024.”
The Aussie-born Korean cuisine chain launched in Melbourne in 2006. Today there are 37 stores across Australia and another five already contracted.
Gami Chicken growth strategy
Lee is eyeing up the New South Wales market, with 36 strategic locations plotted for the state. A Beverly Hill Park outlets has opened, a Newtown store opens in August, followed by an outlet in Albury.
“We want new blood but we are building on delivering more success too for our existing franchisees,” he told Franchise Executives. “Year on year expansion will be 70 per cent in store revenue, and 30 per cent expansion.”
Lee is committed to maintaining in-restaurant dining as the core business. “A lot of franchisors are changing their focus. It comes down to foundation of Gami. We are in casual dining. This is a culture you can feel best when people are in store. When we started the brand, our dream was to emulate a shop
that’s a drop-in for everyone.
“People who used to go to fine dining are now absorbing casual dining because of the market. And we welcome takeaway customers who are upgrading for a special occasion.
“Casual dining can be a fine line. You don’t want to lean too heavily to either side, remaining accessible for all consumers whilst still providing an elevated dining experience.”
Lee said commissioned research has identified three distinct customer personas based on emotions rather than generations.
Focus on franchisee support
The socially connected, cultural connoisseurs, and families, are key to the Korean cuisine chain’s customer expansion.
Lee told Franchise Executives restructuring the business as a fully franchised operation was also an important step.
“We used to have six corporate stores but these were absorbing a lot of head office resources. We couldn’t support all our franchisees effectively.”
Mid-2022 Lee made the decision to reinvest in franchisee support rather that focus on growth. The decision has paid off, with most franchisees in need of extra support reporting improved business performance.
Value deals key to Gami Chicken growth
In response to interest rate hikes, inflation, and global supply chain issues Gami put the spotlight on value.
“As pricing remains the key determinant when choosing products, we introduced value packs and a wider range of budget-friendly menu options which delivered 271 per cent sales growth between March and June 2023,” he said.
Gami Chicken’s revitalised menu introduced single meal options for $10 or $20. Traditionally the menu focused on share plates.
“The reconstructed menu with lower dollar value provides more value for customers, but we’ve made sure COGS remain at 30 per cent so franchisees can still have profit.”
Lee said working with suppliers to swap high cost ingredients for affordable options was crucial.
“At the end of the day I sell chicken. The system is important, and the structure, but most important is tasty food. We want to create something the franchisee wants to sell, that is appreciated by the customer, that is affordable.”
This story was originally published on Franchise Executives.
