It is hard to shake off memories from the early 2000s when Mr Biggs and Tantalizer Plc championed the fast food and restaurant industry. It wasn’t exactly a two-horse race back then, but these two arguably were the dominant forces.
Now, times have changed and for some, business dynasties are ceasing to exist. These “old” but renowned food conglomerates see their influences and markets hijacked by a multiplicity of well-funded new brands.
Chicken Republic, KFC, Mega Chicken, etc, have elevated the competition to a new level. Whilst selling at affordable prices, Chicken Republic, like the other “newbies” has majored in the proliferation of its outlets nationwide. This is hard to beat for anyone and the ability to pull this sort of “swagger” in a market space reek of immense financing.
As you can already tell, funding is everything; and a dearth of it guarantees death for any business today. Tantalizer Plc struggles with funding; thus, their present state is sad to see.
Sweet Sensation, another one of the “oldies” from the early 2000s, enjoyed a new lease of life with the injection of significant cash flow this last half a decade. They made their outlets flashier by renovating and have simply refused to be brushed aside by the bluster of new establishments.
Tantalizer Plc on the other hand isn’t doing very well. It put up one of its worse outings last year, encapsulating a decade-long decline. It closed 2021 with a loss position of N214 million, an embarrassing feat for an ancient brand of its calibre.
Like most fast-food companies after a bad year, Tantalizer hammered down on administrative expenses reducing it from N941 million to N406 million in just 6 months, but this is hardly where the solutions lie, at least not entirely. Not that cost management is an unreliable strategy, but the wrong implementation would have the same impact as pouring water into a basket.
Fund injection is what the business needs. From the look of things so far, management perhaps does not think so given how scarce funds are or there is simply a paucity of believers/investors. Perusing Tantalizer’s Jan-March 2022 report and Jan- June 2022 report, you’ll notice their bottom line albeit positive (for the meantime), keeps declining.
From over N10 million in March 2022 to just over N2 million as at June 2022. This pattern suggests that it will ultimately culminate into another loss by year-end like in 2021.
Management of admin expense as a sole strategy is “effort in futility”. Instead of clamping down on costs, Tantalizer Plc should be looking to spend more, yes, but this time with intent.
Consider this illustration;
Market penetration was a significant strategy that earned Chicken Republic a foothold in the fast-food business at the start. Offering for sale, “rice and chicken” for just N600 at the time, a service tagged “refuel max”, appealed to a large niche of customers. These customers had no problems with repeated purchases given its affordability and supposed good quality. Chicken republic didn’t stop there. They bulldozed their target audience with sponsored adverts over the internet via social media platforms. As a young person, you came across a chicken republic pop-up online daily, informing you that “refuel max” went for as low as N600.
“Refuel max” costs N1350 now and the social media promotional adverts aren’t that consistent anymore. Why? My guess is that they’ve successfully penetrated the market and can allow their services sell themselves.
Tantalizer Plc should be borrowing all the leaves here. Last year, their total expenditure on advertising averaged N3 million monthly. This year so far, in a struggle to avoid another loss position, the average drops to N1.4 million. No promotional campaign nor real penetrative advertisement to inform/remind the target audience of their services is noted. This is simply not the time for advertising to be cut down, and certainly is the perfect moment to intensify advertising but with a better strategy.
Funding is at the heart of whatever progress or resuscitation Tantalizer Plc hopes to make. Tantalizer’s continued focus on cost reduction only guarantees one thing; they die at a slower pace, but they’ll die.