Cobs And Co In The Dough As Canada Proves A Delight
The Age
Friday February 10, 2006
WHEN the franchise giant Bakers Delight wanted to expand into Canada, it had a problem: the name of the company was already under trademark there.
So it came up with COBS Bread, referring to the bread type, and an acronym for "celebration of bread"."It could also stand for 'cunning old baker'," said Roger Gillespie, chairman of Bakers Delight, who opened the first shop 26 years ago in Hawthorn.With more than 600 outlets in Australia, expansion overseas was a clear option if the company wanted to grow, but deciding where was a tough call.It developed an economic model for a range of candidates - London, southern England, Ireland, Singapore, Honk Kong, the US and Canada - to see how they compared with Australia. The criteria ranged from the state of the market and economy and the level of employment, to political stability, customer profiles and shopping trends. The investigation included data on where people bought their bread, the level of competition and the role of supermarkets.The formula used showed Australia on top with 682 points, followed by Canada on 631, the US on 564, Ireland on 555, New Zealand on 498 and England on 405. "Canada was obviously the place to go," said Mr Gillespie, who outlined his strategy to a meeting of the Canadian Australian Chamber of Commerce this week.The director of international development at Bakers Delight, Braeden Lord, who has worked for the company for 20 years, became president of COBS Canada. The international expansion was under way.A team of 10 Australian bakers headed to Canada in 2003 to get the ball rolling. They had one clear aim: to attain $30,000 a week in sales. Vancouver was chosen for the first outlet because of its climate.Mr Gillespie said one teething problem became apparent. "Our formulas did not work with the Canadian flour," he said. A 20-tonne shipment of Australian flour was ordered and delivered, but fortunately the chefs fixed the problem and the first bakery opened on November 14, 2003.COBS hit its financial target in the first week, and progress has been strong since. "We opened our 21st bakery a few weeks ago," Mr Gillespie said. Most are in Vancouver - one is a franchise - and three will be opened in Toronto in April, and another in Edmonton in the next couple of months. The group has about 400 Canadian staff. Annual turnover is expected to be $15 million this financial year. "We will double or triple that next year," Mr Gillespie said.Surprisingly, in contrast to Australia, COBS does not feed off supermarkets. Mr Gillespie described Canadians as "car-destrians". Instead of parking and walking in freezing weather, they will drive 100 metres to each shop to get what they want.Mr Gillespie is bullish about the outlook for Canada, a country of 33 million people. COBS has a target of 500 outlets; and, beyond Canada, the US beckons. Mr Gillespie said the free trade agreement with the US would help. "It will make it easier to migrate staff backward and forward," he said.Mr Gillespie said COBS sold the same range of breads and savouries as Bakers Delight, although Canadians ate more wholemeal and multigrain bread, and less white bread.
© 2006 The Age