'How I built a household name business from a single store'

Having marked 30 years since founding the now high-profile business, Oporto founder Antonio Cerqueira discusses how he grew this iconic Aussie business from a single store on Bondi Beach into an international franchise.

As is a rite of passage for many young people, Antonio Cerqueira left his homeland of Portugal in his teenage years to venture out into the world. Yet his plans to travel to North America and further afield were put on hold when he arrived in Sydney, the city that would soon become his home.

He spent the next 10 years working in an array of hospitality jobs, before taking the plunge and opening his own store.

Little did he know that the store, named ‘Portuguese-style Bondi Charcoal Chicken’, would grow to become one of Australia’s great business success stories.

Starting out

“When you’re from another country, normally you start working hard and think differently, because we come with empty pockets and we need to take some risks. Normally if you take risks and you work hard, you succeed. That’s what happened to me,” Antonio says.

Antonio Cerqueira, Oporto founderHe was 26 years old when he started his own business, recognising a niche for his native Portuguese-style chicken flavours in Australia.

“There was nothing [like it] in the market. That opportunity, with the Portuguese-style chicken, was something different, something new in the market. [I thought] if you do it well, if your flavours come across … it was a good opportunity to succeed in business.

“[So] I opened the first in ’86, and after a year and a half, the business started growing every year. That was the beginning.”

Why did he choose Bondi?

“Because in Bondi at that time, there [were] a lot of young-generation people there, it was close to Bondi Beach. And with the younger generations, normally they don’t have time to cook – somebody needs to cook for them.”

“In the end, I think people follow you – if they believe in what you are trying to achieve, people follow you and they will do what you want to do.”

Growing pains

For the next three years, Antonio ran the Bondi store, but it quickly became apparent that his idea wasn’t a one-trick pony. And so a second store was launched in 1989, in Willoughby on Sydney’s north shore.

“It was a lot of money to do it, but in the end I was positive, because with the first store we were doing well – very well – and it made it a much easier decision to do the second store than the first store,” he says.

This, Antonio explains, was in part because he had strong revenue and a strong business case, but also due to the confidence he had in his product and concept.

“In the end, I think people follow you – if they believe in what you are trying to achieve, people follow you and they will do what you want to do,” he says.

“I called it Oporto because of the football club – they are famous in Europe. Not as famous as Manchester United, but they are famous.

“When you have a good business ... if you do the right thing, you won’t have any problems to build the second store and third store. It worked well.”

Antonio is quick to point out that a major ingredient in the mix at this early point, and indeed right throughout Oporto’s history, was getting the right people on board, and then getting them to really grasp and engage with his vision for the business.

“In the end, I think people follow you – if they believe in what you are trying to achieve, people follow you and they will do what you want to do.”

“If you are doing a franchise, you can bring cash flow to the business. It helped us to grow as we wanted.”

Turning franchise

Interestingly, it wasn’t Antonio’s initial desire to make the transition to a franchise model. Rather it was a means of combating the issue with which virtually all businesses struggle – cash flow.

“At that time, we had the first 14 stores, but cash flow was a problem,” he explains.

“If you are doing a franchise, you can bring cash flow to the business. It helped us to grow as we wanted. From that, in ’99 we had 14 stores [and] by 2007 we had 98 stores, because of the franchise system.”

As well as store numbers, moving to a franchise model enabled the chain to expand its geographic footprint beyond its Sydney base.

“It was positive cash flow because we had cash coming into the business and we could grow the business.”

Antonio Cerqueira, Oporto founderAntonio admits that making the transition to a franchise model is no easy feat, particularly if you have built the business from the ground up yourself. As well as the legal and financial implications, it also means relinquishing a great deal of control and trusting other people to help build the brand further.

“It was a tough decision, because we needed to work with different people. But in the end we take the decisions, even if they are hard,” he says.

“As long as we tried to train as a franchise business well, convinced them to work the way I work, built the culture with franchisees, I thought we could succeed. And it did well.”

Of course, the other consideration was that taking the business national meant pitting it squarely against international fast food giants such as McDonald’s, KFC and Hungry Jack’s.

“We had a few changes, I’ll admit, to grow as fast as we wanted to grow [against these competitors],” admits Antonio.

“A little on the operations side, about how we do some of the preparation of the food [and so on].

“[Also] when we had just a few shops, it was always hands-on, I was more involved day-to-day. As soon as we moved from 14 stores, we needed to change that up to be much easier to do as a franchise business.”

The famous name

Oporto is now a household name. Yet many people are surprised to discover that the name only arrived some years after its launch.

“We knew we couldn’t call it the Portuguese-style Charcoal Chicken everywhere you go, so we needed to come up with a name,” says Antonio.

“Porto is my [home] town, or the closest city to where I come from [the English translation is Oporto]. But the reason I called it Oporto is because of the football club [FC Porto] – they are famous in Europe. Not as famous as Manchester United, but they are famous; they have won championships.

“And the reason we don’t call it Porto but Oporto is for the trademark – it is marked as city name, so we needed a different name, and they let us do that. And so in ’95 we opened with the new concept.”

Moving on

Oporto grilled chicken next to chili sauceHaving taken his business from an idea of serving Portuguese-inspired chicken, to an empire spanning Australia and New Zealand, the question for Antonio became ‘What next?’. And it was for this reason that he made the decision to sell Oporto, for a reported $60 million.

“I sold it in 2007. It was a good offer – too good to refuse,” he explains.

“I thought about [selling] a couple of times before coming to the decision, but in the end it was a good decision price-wise.

“It was time to have a break and go do some different things.”

“From small to big, the most important thing is the cash flow. If you have the cash flow, you don’t have a problem with that [transition].”

The start-up addiction

When he says ‘different things’, however, Antonio means that he was starting other companies from scratch, confessing it is “absolutely” something of an addiction for him.

Those ventures include being a part-owner and director of Daily Fresh Food Service, which has ambitions of listing on the stock exchange as part of joint venture Hudson Food Group.

“I already have another two existing small businesses I’m going to do the same thing to. I think I’ve got the gift – I can take a business from a small business, take it from that and build it to a big level and sell it again,” says Antonio.

“I think there’s a lot of ways you can do it, and you can make money from it too ... [but] it’s not just a matter of making money for myself; I’m happy for everyone around me to make money too.”

Making a comeback

Despite selling the business in 2007, it’s a fitting tribute for Antonio to return to the Oporto family in 2016, to help the company celebrate its 30th birthday.

As a consulting adviser, Antonio will be helping to relaunch and revitalise the business as it looks towards its next 30 years, and beyond.

“I’m happy to be back now and be involved to help them [with] some ideas for the future, and I think Oporto can come back again and start to grow and be the number one franchise in the country again, like we did in 2004/2005,” he says.

With its founder back on the job, it will be interesting to see exactly what Oporto has in store for the future.

“It’s not just a matter of making money for myself; I’m happy for everyone around me to make money too.”

Fast facts about Oporto:

Industry: Fast food

Distribution model: Franchise

Location: Australia and New Zealand.

Founded: 1986 at Bondi Beach in Sydney.

Ownership: Antonio sold the business for a reported $60 million in 2007. Oporto is now owned by Archer Private Equity, which also owns the Red Rooster franchise business.

 

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