Petepan, I believe you will find probability of Yum extending...

Petepan, I believe you will find probability of Yum extending the franchise is very high. The only scenario where I believe Yum would not renew agreements is if Collins Food breached its agreements. However, the conditions are in Collins Food interest to honour, ie. minimum standards and food quality etc. Also, management have been running this business for a long time and have experience in renewing these agreements. Plus, Yum would not want to lose their whole QLD operations unless there were significant reasons (remembering that Collins Foods owns the leasehold assets and holds the lease agreements, meaning Yum would have to find new sites and spend significant money). Furthermore, if Yum stopped renewing agreements without reason, all the other franchisees would notice and stop investing, placing significant risk to the KFC brand and Yum's business model.