Don’t Panic, But Red Rooster Could Be In Serious Trouble

It’s hard to believe that Red Rooster, a fixture of so many suburban childhoods, a friend to so many burnt out parents, could ever be in trouble. Although now I think about it, when is the last time you ate Red Rooster?

Either way, your aging palat isn’t the problem.

According to a submission from franchisees to the Senate's inquiry into the Franchising Code of Conduct, several store owners are facing bankruptcy or have already closed, due to high costs and multiple restrictions placed on them by Craveable Brands—the company that controls the chain.

Craveable Brands operations include Red Rooster, Oporto, and Chicken Treat. But this glorious chicken empire is apparently what the franchisees believe is causing them so many problems. As the submission details: "The common complaint for Red Rooster chicken has been 'it is the same chicken, which is available at the local supermarket for half the price.’”

But any move to sex up the product by adding sauces or spices has been blocked because it would mean the product was competing with sibling brand Oporto. This competitiveness has been further inflamed by Craveable opening competing stores in close proximity to each other

But the problems extend beyond chicken. The submission also claims that Craveable charges significantly more for goods—such as drinks and cutlery—than competitors. For example, one franchisee details: “Mount Franklin Water carton which can be bought for $11 every day price at IGA and costs $18 through Craveable suppliers."

Speaking to Fairfax, a Craveable spokesperson hit back saying, “We don’t believe the submission reflects the views of the vast majority of Craveable franchisees.” They claim the submission has several inaccuracies that “omit vital context about the operation of the broader franchise system.” Adding that ”in a business with more than 400 franchisees across three brands there will be a range of experiences, but our system is healthy and growing and we work closely with our franchisees to support their businesses."

Interestingly, they also claim they haven’t been contacted by the association and aren’t sure who this submission represents.