FOOD GROUP RISKS $1B FINE FOR ‘FOOLISH’ REMARKS

Written on the 5 July 2012

FOOD GROUP RISKS $1B FINE FOR ‘FOOLISH’ REMARKS

THE ASX-listed owner of Brumby’s Bakeries could cop a $1.1 billion fine after the subsidiary urged franchisees to lift prices due to the new Carbon Tax.

The company could be forced to shell out the nine-figure sum for each contravention, if an Australian Competition and Consumer Commission investigation currently underway finds the bakery network had mistakenly linked price rises to the Carbon Tax.

Brumby’s managing director Deane Priest recently told franchisees in an internal newsletter that the Federal Government’s $23 price on carbon should “take the blame … after all, your costs will be going up due to it”.

However, Southport-based Retail Food Group, which owns Brumby’s Bakeries, Donut King, Michel’s Patisserie and bb's cafe franchise systems, has criticised the link between price rises and the Carbon Tax as “inappropriate”.

“Following thorough investigation of the matter, we are satisfied that the comments were not made in an effort to encourage our franchisee community to link regular retail price adjustment to the Carbon Tax, but rather were innocent albeit foolish and ill-considered remarks,” says CEO Tony Alford (pictured) in a written statement.

“The principal purpose of the communication was to promote franchisee evaluation of in-store pricing practices due to cost and margin pressures.

“We therefore express our genuine regret over this isolated incident and unreservedly apologise for this unacceptable error of judgment.”

RFG shares fell slightly today to $2.65 per unit.


Latest News

ACCC TAKES ACTION AGAINST MURRAY GOULBURN

THE ACCC has begun proceedings against milk processor Murray Goulburn alleging it contravened Australian Consumer Law...

RUMOURS ARDENT LEISURE IS LOOKING TO SELL DREAMWORLD

THE PARENT company of Gold Coast theme park Dreamworld is considering a sale of the struggling business to a Chinese ...

TATTS GROUP REFUSES DUE DILIGENCE TO PACIFIC CONSORTIUM AFTER REVISED $6B OFFER

TAKEOVER target Tatts Group (ASX: TTS) has rejected a revised all-cash $6 billion offer from the private equity group...

AGENTS REPORTING STRONG DEMAND FOR MELBOURNE CBD OFFICE SPACE PURCHASES

SEVEN Melbourne CBD offices have recently sold for more than $11 million in total, demonstrating huge demand for c...

Related News

FURNITURE DISRUPTOR SET TO SHARE HIS ONE OF A KIND BUSINESS MODEL

IT'S no secret that Australians love homemaking. Their ceaseless quest to create the perfect place to call hom...

WEEDING OUT THE ASX'S BURGEONING CANNABIS TREND: 8 COMPANIES TO WATCH

A NICHE is budding on the ASX in the form of medical cannabis, an industry which has been on the country's rad...

FRESH CLASS ACTION TO REVEAL ANOTHER SIDE OF SLATER AND GORDON DOWNFALL

ACA LAWYERS has issued a formal letter of demand to Andrew Grech (pictured), managing director of Slater and Gordo...

STARSHIPS WERE MEANT TO DELIVER DOMINO'S PIZZA

NICKI Minaj may have been off the mark when she declared 'starships were meant to fly'. However, she m...

EVENTS COMING UP

 

Contact us

Email News Update Sign Up Contact Details
Subscriptions

PO Box 2087
Brisbane QLD 4001

LoginTell a FriendSign Up to Newsletter