Months after failing to sell Timbercity, Pepkor calls it quits on franchises
- Timbercity is ending its franchise model, brand owner Pepkor has confirmed.
- More than half of the 41 stores in the group – started in 1974 – are owned by franchisees.
- It is talking to franchise holders about "the potential of acquiring select franchise stores", Pepkor told Business Insider South Africa.
- For more stories go to www.BusinessInsider.co.za.
Timbercity will be shutting down its franchise side, the brand's owner Pepkor has confirmed, after more than four decades.
"The Building Company intends to invest further in the Timbercity brand and the scope of its operations and has therefore decided to move away from the franchise-model to that of wholly owned businesses supporting its growth strategy," Pepkor told Business Insider South Africa this week.
The JSE-listed company's Buildings Company division, which also holds Tiletoria and the eponymous Buco chain of hardware stores, had been due to be sold. That deal finally fell through in August, when would-be buyer Cashbuild walked away following the Competition Commission's announcement in May it would recommend the acquisition be blocked.
Out of 41 Timbercity stores, 21 are owned by franchisees.
Some – but not all – of those franchise stores may retain the brand, if their owners agree to sell.
"The Building Company has commenced a process to engage with each franchisee to discuss future prospects, including the potential of acquiring select franchise stores," said Pepkor.
Until earlier this year, Timbercity offered to help independent board and timber stores convert to franchises at no brand conversion cost, while they would get access to its "top-of-mind brand awareness".
The first Timbercity franchise opened in 1979, three years after the brand was bought by PG Wood and five years after the first store opened in Parow in 1974.
PG Wood became PG Bison after a 1986 merger with then Mondi-owned Bisonbord, and PG Bison was swallowed by the Steinhoff Group in 2004.
That company’s furious corporate activities saw Timbercity end up as part of the JD Group, by way of SteinBuild, a division of Steinhoff Africa (Star) – which changed its name to Pepkor in 2018 to distance itself from Steinhoff International, of Markus Jooste fame.
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