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Wed 2 Aug 2006 04:00 AM

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Brumby's bakes surprise for Middle East

Brumby's, one of Australia's best known bakeries, has unveiled plans for a number of outlets across the region.

Brumby’s Bakeries Ltd, one of Australia’s best-known high street bakers, is set to roll out stores across the Middle East after reaching an agreement with a local master franchisee, IIC Group, in the region.

The ten-year agreement with IIC Group, a Middle East consortium, covers GCC countries and Iran. Brumby’s managing director, Michael Sherlock said he expected the first Brumby’s stores to open in the Middle East by 2007.

“Hopefully we’ll have our first stores opening up in this financial year; we’ll probably open up with about two or three in each market and we’ll take it from there. Initially we’re looking at Bahrain, Dubai and Doha,” Sherlock told Retail News Middle East.

“These are the cities we’re looking at in the initial instance and then once we’re established in those areas, then we’ll look further afield to Kuwait and Muscat.

“Since signing an initial memorandum of understanding late last year we have been finalising our business plan and conducting extensive market research,” he added. “It is clear that there is a tremendous potential in the Middle East and we expect to see considerable store growth during the next decade.”

The speed of Brumby’s expansion in the Middle East will depend on the success of the initial stores, according to Sherlock. “We prefer to get the initial stores proven in that market because it’s all subject to the initial consumer response. We’ve done a fair bit of work there and observed other bread offers in the supermarkets. We think that a broad-based Australian concept will have some merit in the Middle East,” he added.

Furthermore, Sherlock expects the Brumby’s concept to be successful in the region, not least because of the range of bread the chain offers at its stores. “We’ve got a wide variety of bread products because Australia is pretty multi-cultural,” he said. “We’ve got 150 products from all different cultures around the world, savoury and sweet products such as pastries and traditional Australian products including pies and sausage rolls.”

The plans mark Brumby’s first expansion outside Australia and New Zealand, where the company has 317 stores. But despite the ambitious scale of the proposed expansion, Sherlock said Brumby’s is still looking at other potential markets.

“Apart from the Middle East, over the past 12 months we have conducted pre-entry studies and held discussions with potential master franchisees in Thailand, Malaysia, Singapore, China, Fiji, and South Africa,” he said.

Brumby’s has operated in Australia for about 30 years and is listed on the Bendigo Stock Exchange.

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