Spur Corp, known for its steaks and meaty burgers, is exploring plant-based foods through a new brand — Modrockers — in a bid to attract younger consumers.
Spur, which owns brands such as RocoMamas, John Dory’s and Panarottis, has opened its first Modrockers — a plant-based quick service restaurant — in Rosebank, Johannesburg.
The new brand is in its fourth month of its pilot phase and is aimed at the “youthful target market defined as ‘flexitarians’ who are seeking a value meal with a greater purpose”, Spur CEO Val Nichas said this week at the group's interim results presentation. The group “aims to capitalise on the growth and awareness of plant-based eating”.
Nichas said the group will monitor consumer response to Modrockers over the next six-12 months and then determine “our strategy to expand the brand. Based on the success of this pilot restaurant we will look for opportunities for further sites”.
Vegan options will continue to feature on restaurant menus across all Spur brands.
Although it's a niche, “we are expecting growth as more customers make a personal choice of wellness and environmental awareness”, Nichas said. “While people may eat healthily at home, eating out is generally a treat and it may take some time before consumers make the shift to healthy lifestyle eating in restaurants.”
SA is known for its addiction to red meat, so it may take some time before it goes the same way as the West
— Chris Gilmour, an investment analyst with Salmour Research
Chris Gilmour, an investment analyst with Salmour Research, said a growing number of people in Western countries are turning to healthier meal options, both at home and eating out.
“SA is known for its addiction to red meat, so it may take some time before it goes the same way as the West, with far more in the way of plant-based offerings. But it’s a global trend and it will happen in SA too, eventually.”
Speaking from Scotland, Gilmour said: “I have been stunned to see how many people here are vegetarians, although the majority of them would have been brought up on a predominantly meat diet. SA is not there yet, what with its culture of braaiing meat, but it is coming.”
Last year Spur’s restaurant base expanded to 627, with 545 outlets in SA and 82 across the rest of Africa, Mauritius and the Middle East. It opened 16 restaurants in SA, including seven RocoMamas, three Spurs and two Panarottis, while 10 were closed.
This year it plans to open 32 new restaurants in SA and seven internationally.
Gilmour said there is obviously still demand. “Remember, we are not talking about upper-end fine dining here, apart from maybe Hussar Grill,” which is owned by Spur.
Spur is casual dining and people are trading down from more upmarket eateries. “So there is plenty of space left in this affordable segment of the market,” said Gilmour.
Headline earnings rose by 119.4% to R59m in the six months to end-December 2021. The Spur brand increased local restaurant sales by 32.6%. Panarottis, John Dory’s and RocoMamas all increased restaurant sales by a third and The Hussar Grill by 45% in SA.
Gilmour said this “is a tremendous turnaround” for Spur, helped by the easing of pandemic restrictions. (In the full year to end June 2021, group revenue declined 10.5% to R681m.)
In the first half of this financial year takeaways accounted for 20% of the group’s South African turnover, mostly at RocoMamas (53%) and Panarottis (40%).
Nichas said a return to trading at pre-Covid levels depended on market conditions and the continued impact of the pandemic, “with certain brands like Spur already being very close to pre-Covid sales levels”.
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