What started as a bakery café in Greenside, Johannesburg ten years ago is fast becoming a sought after restaurant franchise with its sights set on various trendy spots throughout Gauteng and eventually expanding to other parts of the country.
Doppio Zero owner, Paul Christie, moved to Johannesburg in 1992 after studying in Cape Town. He opened a number of convenience stores and small restaurants, but it was in 2002 that he and his business partner, Miki Milovanovic secured the Greenside site. Christie explains that at the time, the site didn’t have restaurant zoning and Milovanovic had a baking background, two factors that combined to create a great business opportunity.
“We got around the restaurant zoning issues by opening a bakery with tables,” he says, adding that the concept was very well received as there were no café bakeries at the time. The store got busy and the demand was there for evening trading, so the owners decided to extend it beyond the store.
Offering Something Different
Christie’s Greek family, coupled with his partner’s skill, meant the pair had significant experience and access to bakers. According to Christie, his family was involved in developing the recipes for Doppio Zero’s meals. He says the concept for Doppio Zero is that of a casual eatery. “We try not to be too formal. We offer good food in a bistro environment.”
With a refined concept that was becoming increasingly popular, Christie and Milovanovic opened two more stores in Bedfordview and Fourways. They later decided to franchise these and then opened the Rosebank branch as a franchise store.
Developing the Franchise
Turning Doppio Zero into a franchise was always a debate, says Christie. They first looked at the joint venture model, but the structure couldn’t handle the growth. “We looked at outsourcing, but didn’t have the capital to open shops,” he says, adding that a restaurant is a more challenging model than franchising a takeaway business.
Once the first three stores were opened, all owned by Christie and Milovanovic, the business was becoming difficult for them to control, and Christie says they didn’t have the infrastructure needed to run the three operations concurrently. The owners met with Franchising Plus who took them through the necessary steps of franchising their business. Christie says it was an “interesting process” that saw them having to develop an operations manual, recipe books and more. “It is an evolving, ongoing process. We never sit still as there are always new laws, systems and ideas.”
For Christie, the starting point was finding good people that he could teach the systems to. They didn’t necessarily need experience in running a restaurant but had to be good at dealing with customers.
Doppio Zero now maintains a balance between franchised and co-owned stores. “The restaurants we are running allow us to understand the business because we are in it,” he explains. There are currently eight stores in total, seven of which are located in Johannesburg and one in Cape Town. Four of the stores are owned by franchisees, two are company owned and the other two are joint ventures.
Growing the Brand
Christie admits that growth through franchising has been slow. He attributes this to the difficulties facing business owners when trying to access money and negotiate with landlords. Banks are making it harder for potential franchisees to secure loans and landlords are charging inflated prices to lease property.
Notwithstanding these challenges, Christie says business has been satisfactory, with the group’s results up by 13% on the previous year. But, 2011 also saw the closure of two restaurants in Cape Town due to the franchisees’ financial circumstances. Christie says the decision was made to keep the brand in Gauteng to get the systems more refined before looking at Cape Town locations again. The only remaining restaurant in Cape Town is located at Mandela Rhodes Place.
But, in Johannesburg, the flagship stores, namely Rosebank (which is the biggest) and Greenside, are booming. A new store will open in the new section of Sandton City shopping centre later this year.
Christie says the process of growing the Doppio Zero franchise has always been an informal one, but this is changing as new procedures become more structured. The product is the same in all restaurants, but the atmosphere and set-up vary. “We are looking at making this more consistent. In the beginning we wanted every restaurant to be unique, but this doesn’t work in a franchise environment.”
According to Christie, the menu is consistent, as is the quality of food and service. In all the restaurants, he wants to express the European café culture. One area that does allow for a bit of flexibility is the retail side. “Franchisees can be more proactive on the baking side, but the bakery only accounts for about 20% of each restaurant.”
The Business Concept
The ideal location for a Doppio Zero restaurant is a combination of numerous factors, which Christie lists as character, availability of outside areas, vibe, atmosphere, proximity to other businesses and residential areas, and parking space. “We need to make it more of a science; now we rely a lot on gut feel. The overheads of running a restaurant are high, so we need high turnover. The turnover of ten years ago is now what the wage bill is so the location has to be right for the brand, but also have the potential for high foot traffic,” he explains.
During the day, Doppio Zero positions itself as a café bakery, and in line with this stays away from accessories like table cloths, but in the evening it has more of a casual dining feel offering sophisticated food, which Christie calls ‘interesting food’. “We try to keep the menu local so that the restaurants are seen as a local hangout, but the meals are generally Mediterranean/Italian so we try and stick to that.”
Going forward, Christie says the group is going to establish a central bakery which will supply most restaurants, but that some will continue to bake their own products. He says the reason for this is the high electricity costs and scarcity of skilled staff. “It doesn’t always make sense to have a full bakery, but it is part of our character so we won’t take it away completely,” he adds.
While Christie considers competition in the market to be a challenge, he says it is a good one as it keeps the industry going. The rise of new entrants into the market is positive as it forces businesses to improve and differentiate themselves.
What differentiates Doppio Zero from its competitors is the menu and the bakery element. “The menu is a big factor, in terms of the dishes offered and the way we cook.” Another strength is that the restaurants offer a non-threatening atmosphere. “We have a diverse customer base, ranging from guys in shorts to tuxedos.”
According to Christie, the target market is adults aged between 26 and 40 years old in the eight to ten LSM bracket. However, he says the restaurants are becoming more and more popular with families, which was never intended. This could lead to more child-friendly stores in future.
Finding the Right Franchisees
Many people have approached Doppio Zero because they are interested in becoming part of the brand, says Christie, but the challenge is finding people with the right experience and the cash required. Christie explains that if he finds an operator with all the right skills but they don’t necessarily have the cash, he tries to find an investor. “We try to give them the chance to get into the business if they show that they are really passionate about it.”
Christie says a lot of enquiries come through the Doppio Zero website.
The first step requires franchisees to fill in an application form. If the franchisor is happy with the information provided they will set up a meeting with the potential franchisee and then make a decision about whether or not to go forward with them. According to Christie a new process has been introduced which requires the franchisee to secure the lease first. As the franchisor, Doppio Zero will assist the franchisee with negotiating rentals, training staff and building the restaurant. New franchisees are trained in other stores for between one and two months, while new staff are trained for between one and two weeks.
Christie says the success of Doppio Zero is due to its high regular customer base, which has ensured consistent growth. But adds that the focus for the group will be on the head office structure. Another important aspect will be maintaining the standard of food throughout the franchising process. “We have to keep a certain amount of integrity with our cooking methods.” Doppio Zero will be looking at moving towards more responsible buying, including free range or organic products.
The next phase, he says, is to present food in a more appealing way while still offering good value portions. Christie says the group chef is constantly developing new ideas for the menu and the restaurants will soon be introducing smaller portioned helpings during the day at lower prices. Christie believes that the Doppio Zero brand remains relevant with its target market by innovating. He adds that better training techniques and good front of house staff are important, as is keeping the stores fresh. This is done by renovating the stores every three to five years.
In terms of opening new restaurants, Christie says the focus will be on opening smaller Doppio Zero bakery sites in Pretoria as well as the West and East Rand of Johannesburg. “We want to focus on those areas now and in 2013 we will start looking at Cape Town, KwaZulu Natal and other areas of South Africa. We want to grow Doppio Zero into a national brand so we are going to be putting our foot on the gas and opening more franchises,” he says.
The Importance of Customer Service
Offering the customer a pleasant, unforgettable experience is key in the restaurant business. This is something Christie knows all too well. “The big thing with restaurants is people. You are only as good as the last experience a customer had.” While the restaurant is operating, usually from 7am to 10pm, there are many opportunities to give great service or miss the boat, says Christie, adding that customers should be regarded as guests.
Apart from driving training programmes for waiters, Doppio Zero is also proactive when it comes to customer complaints. “If someone loves a place, they will tell a friend, and word of mouth is so important for the business.” Christie says a lot of feedback is received through the group’s website and that an effort is made to address it immediately.
He claims that with 95% of the issues raised, Doppio Zero is able to turn disgruntled customers around. He says a franchisee can’t be controlled, but people can be directed to company stores. Franchisees, however are trained to get customers back.
“We all make mistakes, but it is the way we recover that counts. What really angers people is when a company doesn’t care. Service is a very big thing because people have other choices.”
The origin of ‘Doppio Zero’
The name, Doppio Zero, means double zero. This is a grading of flour in Italy. Type 00 is a fine flour which the restaurant group uses to make its pizzas and pastas.
The Doppio Zero franchisee
The ideal Doppio Zero franchisee has restaurant experience and the ability to manage people. Paul Christie, founder of Doppio Zero, says the right character can make it work. He explains that the restaurants are very people intense businesses, hiring between 35 and 60 people. “A franchisee needs to be capable of managing the process.”
Besides staff, they should also be able to handle customers. According to Christie, this takes a certain kind of personality and it’s easy to recognise whether or not a person has the right skill. Another characteristic he looks for in a new franchisee is compliance. While franchisees should think for themselves, there are certain set systems and procedures they are required to follow.
“The best franchisees are those who challenge us the most, they keep us on our toes.” Of course, he says, they have to work hard and be programmed to working hours that most people don’t work. Doppio Zero favours owner-managers as they should have a vested interest in the business.
6 Lesson Gems From Appanna Ganapathy That Helped Him Launch A High-Growth Start-Up
Twenty years after first wanting to own a business, Appanna Ganapathy launched ART Technologies, a business he aims to grow throughout Africa, starting with Kenya thanks to a recently signed deal with Seacom. As a high-growth entrepreneur with big plans, Appanna spent two decades laying the foundations of success — and now he’s starting to collect.
- Player: Appanna Ganapathy
- Company: ART Technologies and ART Call Management
- Launched: 2016
- Visit: art-technologies.co.za; art-callmanagement.co.za
Like many entrepreneurs before him, Appanna Ganapathy hadn’t even finished school and he was already thinking about his first business venture. A friend could secure the licensing rights to open Nando’s franchises in Mozambique, and they were very keen on the idea — which Appanna’s mom quickly dampened. “You can do whatever you want,” she said. “As long as you finish your degree first.”
Unlike many other entrepreneurs however, Appanna not only finished his degree, but realised that he had a lot of skills he needed to develop and lessons to learn before he’d be ready to launch the business he wanted.
“We launched ART Technologies just over two years ago. If I had started any earlier, I don’t think I would have been as successful as I am now,” he says.
Here are six key lessons that Appanna has learnt along his journey, which have allowed him to launch a high-growth start-up that is positioned to make an impact across Africa.
1. You don’t just need a product – you need clients as well
Business success is the ability to design and execute a great product and solution, and then be able to sell it. Without sales, there is no business. This is a lesson Appanna learnt while he was still at university.
“I was drawn to computers. I loved figuring out how they worked, playing computer games — everything about them,” he says. “My parents lived in Mozambique, and during my holidays I’d visit them and a friend who had a computer business. I helped him assemble them and thought I could do this too while I was studying. I convinced my dad to buy me a car so that I could set up my business — and never sold or assembled a single computer. I delivered pizzas instead.”
So, what went wrong? The simple truth was that at the time Appanna had the technical skills to build computers, but he lacked the ability to sell his product.
“If someone had said, ‘I’ve got an order for 30 computers’, I would have filled it — but to go out and get that order — I didn’t really even know where to start.”
2. Price and solution go hand-in-hand
As much as you need the ability to sell your solution, you also need a market that wants and needs what you’re offering, at a price point that works for everyone.
In 2007, Appanna was approached by a former supplier whom he had worked with while he was based in Mozambique. The supplier had an IT firm and he wanted to expand into South Africa. He was looking for a local partner who would purchase equity shares in the company and run the South African business.
“I loved the opportunity. This was something I could build from the ground up, in an area I understood well,” says Appanna. The firm set up and managed IT infrastructure for SMEs. The value proposition was simple: “We could offer SMEs a service that they could use for a relatively low cost, but that gave them everything an enterprise would have.”
The problem was that although Appanna and his team knew they had a great product, they were competing on price with inferior products. “If we couldn’t adequately unpack the value of our solution, an SME would choose the cheaper option. It was a big lesson for me to learn. It doesn’t matter how good the solution is that you’re offering — if it’s not at a price point that your target market accepts, they won’t choose you.”
It was this understanding that helped Appanna and his team develop the Desktop-as-a-Service solution that ART Technologies now offers the SME market.
“While I was developing the idea and the solution, I needed to take three key things into account: What do SMEs need from an IT infrastructure perspective, what is the most cost-effective way to offer them that solution, and what will the market pay (and is it enough to cover our costs and give us a small profit margin)?”
Appanna’s experience in the market had already taught him how cost-conscious SMEs are, and so he started developing a solution that could deliver value at a price point SMEs could accept. His solution? A unique Desktop-as-a-Service product that combines all the processing power and Microsoft products a business needs, without any capex outlay for servers or software.
“It’s a Cloud workstation that turns any device into a full Windows computer,” Appanna explains. “We hold the licences, and our clients just access our service. A set-up that would cost between R180 000 and R200 000 for 15 users is now available for R479 per user per month.”
It took Appanna and his partners time to build the solution, but they started with the price point in mind, which meant a solution could be designed that met their needs as well as the needs of the market.
“Too many businesses set everything up, invest in the solution, and then discover they can’t sell their product at the price point they need. My time in the market selling IT and infrastructure solutions gave me invaluable insights into what we needed to deliver on, and what we could realistically charge for our service.”
3. Get as much on-the-ground experience as you can
The time that Appanna spent building the IT firm he was a part-owner of was invaluable. “I started as a technical director before being promoted to GM and running the company for three and a half years. Those years were very, very important for me. They’re where I learnt everything about running a business.
“When I started, I was responsible for sales, but I didn’t have to actually go out and find clients, I just had to meet them, compile quotes and handle the installations. Everything I did was under the guidance of the company’s CEO, who was based in Mozambique. Being the guy who did everything was the best learning ground for me. It set me up for everything I’m doing today. In particular, I learnt how to approach and deal with people. Without people and clients your business is nothing.”
Appanna didn’t just learn by default — he actively worked to expand his understanding of all facets of the business. “At the time I wasn’t planning on leaving to launch my own business,” he says. “I was a shareholder and I wanted to grow that business. That meant understanding as much as possible about how everything worked. If there was something I wasn’t sure of — a process, the numbers, how something worked — I asked. I took personal responsibility for any errors and got involved in every aspect of the business, including areas that weren’t officially ‘my job’. I wanted to really grow and support the business.”
4. Stay focused
Interestingly, while the experience Appanna has accumulated throughout his career has allowed him to build a high-growth start-up, it also taught him the importance of not wearing too many hats as an entrepreneur.
“I’m glad I’ve had the experience of wearing multiple hats, because I’ve learnt so much, but I’ve also learnt that it’s important to pick a lane, not only in what you do as a business, but in the role you play within your business. I also race superbikes in the South African Kawasaki ZX-10 Cup; through this I have learnt how important it is to focus in the moment without distractions and this is a discipline I have brought into the business.”
“If you’re the leader of an organisation, you need to let things go. You can’t be everything to everyone. When I launched ART Technologies, I knew the key to growth would be the fact that although I’m technical, I wasn’t going to run the technical side of the business. I have strong technical partners whom I trust, and there is an escalation framework in place, from tech, to tech manager, to the CTO to me — I speak tech and I’m available, but my focus is on strategy and growth. I believe this is the biggest mistake that many start-ups make. If you’re wearing all the hats, who is looking at where you’re going? When you’re down in the trenches, doing everything, it’s impossible to see the bigger picture.”
Appanna chose his partners carefully with this goal in mind.
“All the partners play a very important role in the business. Ruaan Jacobs’s strength is in the technical expertise he brings to the business and Terry Naidoo’s strength is in the support services he provides to our clients. Terry is our technical manager. He has the most incredible relationship with our customers — everyone wants to work with Terry. But there’s a problem with that too — if we want to scale this business, Terry can’t be the technical point for all of our customers.
“As partners we have decided what our blueprint for service levels will be; this is based on the way Terry deals with clients and he is developing a technical manual that doesn’t only cover the tech side of the business, but how ART Technologies engages with its customers.
“Terry’s putting his essence down on paper — a step-by-step guide to how we do business. That’s how you build a service culture.”
5. Reputation, network and experience count
Many start-ups lack three crucial things when they launch: Their founders haven’t built up a large network, they don’t have a reputation in the market, and they lack experience. All three of these things can (and should) be addressed during start-up phase, but launching with all three can give the business a valuable boost.
Appanna learnt the value of networks at a young age. Born in India, he moved to Zambia with his family as a young child. From there he moved to Tanzania and then Mozambique, attending boarding school in Swaziland and KwaZulu Natal. At each new school, he was greeted by kids who had formed strong bonds.
“I made good friends in those years, but at each new school I recognised how important strong bonds are, particularly as the outsider.”
Appanna’s early career took him back to Mozambique, working with the UN and EY on various projects. When he moved to South Africa, as a non-citizen he connected with his old boss from the UN who offered him a position as information officer for the Regional Director’s team.
His next move would be to the tech company that he would run for just over three years — also the product of previous connections. “Who you know is important, but how you conduct yourself is even more so,” says Appanna. “If your reputation in the market place is good, people will want to do business with you.”
Appanna experienced this first hand when he left to launch his own business. “Some key clients wanted to move with me,” he says. “If I had brought them in it would have settled our business, but I said no to some key customers who hadn’t been mine. I wasn’t ethically comfortable taking them with me.”
One of those multinational clients approached Appanna again six months later, stating they were taking their business out to tender and that they were hoping ART Technologies would pitch for it. “Apart from the Desktop-as-a-Service product, we also provide managed IT services for clients, particularly larger enterprise clients. Due to the client going out on tender and requesting for us to participate, we pitched for the business and won. The relationship with this client has grown, allowing us to offer them some of our services that they are currently testing to implement throughout Africa.”
“I believe how we conduct ourselves is essential. You need your own personal code of ethics, and you need to live by it. Business — particularly in our environment — is built on trust. Our customers need to trust us with their data. Your reputation is key when it comes to trust.”
Interestingly, although Appanna and his team developed their product based on a specific price point, once that trust is built and a certain standard of service is delivered, customers will pay more.
6. Start smart and start lean
Appanna was able to launch ART Technologies with the savings he and his wife, Kate, had put aside. He reached a point where he had ideas he wanted to take to market, but he couldn’t get his current business partners to agree to them — and so setting up his own business became inevitable.
Although he was fortunate to have savings to bootstrap the business, it was essential for the business to be lean and start generating income as quickly as possible. This was achieved in a number of ways.
First, Appanna and Kate agreed on a start-up figure. They would not go beyond it. “We had a budget, and the business needed to make money before that budget was reached.” The runway Appanna gave himself was only six months — highly ambitious given the 18-month runway most start-ups need. “Other than my salary we broke even in month three, which actually extended our runway a bit,” says Appanna.
Appanna had a server that he used to start with, and purchased a second, bigger server four months later. He also launched another business one month before launching ART Technologies — ART Call Management, a virtual PA services business that needed a PABX system, some call centre technology and two employees.
“I’d been playing around with the idea for a while,” says Appanna. “We were focused on SMEs, and I started noticing other challenges they faced. A lot of entrepreneurs just have their cellphones, but they aren’t answering them as businesses — it’s not professional.
“In essence we sell minutes — for R295 you get 25 incoming calls and 50 minutes of transferred calls. We answer the phone as your receptionist, transfer calls and take messages. How you use your minutes is up to you. For example, if you supply the leads, we can cold call for you. ART Technologies uses the call management business as a reception service and to do all of our cold calling. It’s kept the business lean, but it’s also brought in an income that helped us with our runway.” In 2017 ART Call Management was selected as one of the top ten in the SAGE-702 Small Business Awards.
The only problem with almost simultaneously launching two businesses is focus. “It’s incredibly important to know where you’re putting your focus,” says Appanna. “The call management business has been essential to our overall strategy, but my focus has been pulled in different directions at times, and I need to be conscious of that. The most important thing for any start-up is to know exactly where your focus lies.”
Thanks to a distribution deal signed locally with First Distribution, ART Technologies was introduced to Seacom, which has available infrastructure in a data centre in Kenya.
“It’s a pay-per-client model that allows us to pay Seacom a percentage of every client we sign up,” says Appanna. “First Distribution will be our sales arm. They have a webstore and resellers, and we will be opening ART Kenya with a shareholder who knows the local market.”
From there, Appanna is looking to West Africa and Mauritius. “We have the product and the relationship with Seacom gives us the foothold we need to grow into East Africa.”
Kid Entrepreneurs Who Have Already Built Successful Businesses (And How You Can Too)
All over the world kids are abandoning the traditional notion of choosing a career to pursue until retirement. Gen Z aren’t looking to become employable job-seekers, but creative innovators as emerging business owners.
Do kids have an advantage or disadvantage when it comes to starting and building a company? It depends on how you look it. Juggling school, friends, family and other aspects of childhood and adolescence comes with its own requirements, but perhaps this is the best age to start.
“Being an entrepreneur means having to learn, focus, and connect to people and these are all traits that are valuable throughout life. Learning this when you are young is especially crucial, and will set you up for success and to be more open to other opportunities,” says billionaire investor, Shark Tank personality and author Mark Cuban.
Here are some of the most successful kidpreneurs who have cashed in on their hobbies, interests and needs to start and grow million dollar businesses borne from passion and innovation:
30 Top Influential SA Business Leaders
Learn from these South African titans of industry to guide you on your entrepreneurial journey to success.
Entrepreneurship is said to be the answer to South Africa’s unemployment challenges and slow growth, but to foster entrepreneurship we ideally need business leaders to impact grass root efforts. Business leadership is vital to improved confidence and growth. These three titans of global industry say:
- “As we look ahead, leaders will be those who empower others.” – Bill Gates
- “Leaders are also expected to work harder than those who report to them and always make sure that their needs are taken care of before yours.” – Elon Musk
- “Management is about persuading people to do things they do not want to do, while leadership is about inspiring people to do things they never thought they could.” – Steve Jobs
Here are 30 top influential SA business leaders forging the path towards a prosperous South African future.
- Zareef Minty
- Roger Boniface
- Khanyi Dhlomo
- Zuko Tisani
- Phuti Mahanyele
- Nunu Ntshingila
- Dr. Judy Dlamini
- Tshego Sefolo and Londeka Shezi
- Nonkululeko Gobodo
- Dudu Msomi
- Sibongile Sambo
- Ian Fuhr
- Esna Colyn
- Ryan Bacher
- Nicky Newton-King
- Adrian Gore
- Terry Volkwyn
- Richard Maponya
- Sisa Ngebulana
- Wendy Luhabe
- Polo Leteka
- Vusi Thembekwayo
- Marnus Broodryk
- Thuli Madonsela
- Lebo Gunguluza
- Dawn Nathan-Jones
- Nicholas Bell
- Ran Neu-Ner and Gil Oved
- Vinny Lingham
- Patrice Motsepe
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