The Cheesecake Shop: An Australian and New Zealand success story

Founded in 1991 in Sydney, The Cheesecake Shop operate over 220 stores across Australia & New Zealand. The brand is now owned by River Capital having purchased the business from PAG Asia Capital in 2022.

With a proven track record of success in Australia, River Capital has appointed ex Dominos Ireland executive Scott Bush to the role of Managing Director to build on the success of the brand and capitalise on the brand equity the business has built up over its 30 year existence as the dominant dessert & cake business in this country.

The Cheesecake Shop hold a rather unique position in the market as the only true manufacturer and retailer of take home cakes, and desserts all made to order on site. TCS serves nearly 5 million customers daily and 90% of consumers recognize the brand. Like any business, TCS faces increased competition from supermarkets that offer products at a lower price point but cannot match the superior quality and range The Cheesecake Shop provides.

In mid 2022, Josh Ludski of River Capital, contacted Geotech to assist the business to better understand how the brand could identify potential new store locations and profitably grow the business. The challenge for any mature business is to make sure that future network growth does not come at the expense of existing franchised stores, but to explore where demand in new growth areas could support new stores without cannibalising sales from existing franchisees.

There are a number of factors that define a good location opportunity for occasion based food retailers like The Cheesecake Shop over and above having sufficient numbers of the right demographic the brand attracts, positioning, site visibility, parking and access all contribute to the overall success of a location.

Geotech was engaged to firstly undertake a full market analysis for the brand to identify the key factors driving sales and the relative contribution each factor makes to store sales performance. Once identified, we were able to build sales forecasting models to assist the business with a more scientific approach to forecasting the sales potential for any new site of interest.

In addition, Geotech were then able to create suitable catchment areas around each store location and better understand the quantum of cannibalisation occurring in the network when a new store opened, and measure impacts on the surrounding stores. Managing cannibalisation impacts for destination driven brands is a critical part of network planning.

Another benefit in undertaking this kind of analysis, is to use the models developed to optimise the current store network, focussing on those stores that may be underperforming and learning from the insights on how to improve performance and profitability.

The final part of the project involved Geotech providing a prioritised network plan identifying specific locations with enough of the right demographic characteristics that could support a new store.

Geotech then designed some tools The Cheesecake Shop could use internally to help focus only on those sites worthy of further in-depth analysis and the ability to order both a sales forecast and cannibalisation impact report (if needed).

If you need Geotech’s market leading experience and insights, please call Jeff Vassel 0421 684 444 or [email protected]



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