Amanda and Bryan Kelly are struggling to get back on their feet after being involved in a Retail Food Group franchise.
Amanda and Bryan Kelly are struggling to get back on their feet after being involved in a Retail Food Group franchise. Warren Lynam

Four years of franchise hell leaves couple $800k in debt

BRYAN and Amanda Kelly say they have always been "successful" in everything they've done, but "four years of hell" owning a franchise through Retail Food Group has left them picking up the tatters of their old life.

A lack of support, exorbitant compulsory refurbishments, un-competitive pricing and a slew of fees ran their business into the ground before they could even get started, the Kellys claim.

But, their story is not the only one.

RFG - which includes brands Donut King, Brumby's, Gloria Jean's, Pizza Capers, Crust Gourmet Pizzas and Michel's Patisserie - has recently come under a fire after a Fairfax investigation into its "brutal business model" as more and more financially devastated franchisees come forward to share their stories.

Legal firm Bannister Law has proposed a class action against the company which RFG has said it will defend "vigorously".

With experience in running businesses and 30 years of bakery and pastry cooking knowledge, Mr Kelly said when they moved from Victoria to Queensland he thought it would be best to start out with a franchise before moving onto their own store, so they could learn the local market while being supported.

The Kellys took over Brumby's at the Sunshine Plaza in 2009, but just weeks later they said it was clear the figures they'd been given "weren't right" with the couple only making about $200 per week.

"They were pumping us up saying, you've got a gold mine," Mrs Kelly said.

"You'll do better than Brisbane."

They walked away from the business on June 30, 2013, owing more than $800,000.

"We really felt like a failure," Mr Kelly said.

"We thought maybe it was us, but we've gone through everything and thought, 'we tried everything in our power'."

Through their short tenure with the company, the pair said they faced many brick walls including trying to compete with their neighbouring store Coles, which was selling bread for less than a dollar.

During a meeting with an area manager, Mr Kelly also claims they were offered waived fees to help keep their heads above water only to receive a $55,000 fee relief debt bill months later.

They were further required to spend $150,000 updating the store despite their claims the store was physically fine and the upgrade was unnecessary.

The couple have been left with nothing and are now renting a home, with Mr Kelly suffering from an auto-immune disease believed to be brought on by the stress of the situation.

He's now on a partial disability pension while his wife works full-time in administration.

An RFG spokeswoman said she was unable to comment on "specific details of our current and former franchisees", but the company was now "six months into a business-wide review to improve the support, value and services we provide to our franchisees".

"Recently, the focus has been on the negative experiences of some franchisees rather than the majority of our franchisee network who are running successful businesses," she said.

"With such a huge network, we don't get it right every time or claim that all our franchisees are always happy, but we do know that we are working extremely hard to support them in incredibly tough retail market conditions."

Mrs Kelly said she hoped by sharing their story more former RFG franchise owners would come forward and be able to offer each other support.



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