vafooli. Regarding why spend the money on buying franchisees...

vafooli.

Regarding why spend the money on buying franchisees rather than just continue expanding...

They wrote a bit about this at the beginning of the year when they announced this is what they would be doing.

Essentially they have been growing the number of franchisee outlets massively over the past few years and they basically got to a point where although revenues were growing, this wasn't flowing through to such significant growth in the bottom line. They noticed how much more profitable they were in the stores they personally owned and so decided to start buying out franchisees. Not only would it help increase margins but also give them more control over their image. I imagine they have been strategic over which franchisees they have bought back.

Rather than focusing solely on revenue expansion via number of stores, they have moved their focus to online. So this year you will have seen them begin to develop their brand's websites a little (still need a lot of further work), but more so they have been expanding the number of on-line retailers that are stocking/selling their brands.