Fast-food operator Collins Foods has signed a new corporate franchise agreement to take over KFC Netherlands’ franchise, a subsidiary of Yum! Brands.
“Today’s announcement marks a true milestone in the progression of Collins Foods’ strategy in Europe,” said Drew O’Malley, chief executive and managing director at Collins Foods.
“We believe there is substantial opportunity for restaurant growth in the Netherlands, given KFC’s low penetration rate relative to developed markets and other quick-service brands. We enjoy a strong partnership with KFC in Europe and globally, and this agreement is a testament to the quality of that relationship.”
The deal would enable Collins Foods to develop, manage, operate, and support KFC’s business, including introducing, managing, and overseeing existing and future franchisees.
With 34 outlets at present, the agreement would allow the fast-food operator to open up to 130 new stores, both franchised and company-owned, potentially increasing its Netherlands footprint by almost five-fold.
The company would also receive a fee from KFC to cover the costs of running the business and will earn incentives if performance targets are met.
The five-year deal takes effect in December with a conditional option for Collins Foods to extend for an additional five.