Happy Monday Flux fam!

Today's big stories: 

✈️ Qantas is riding the industrial property boom 

🏋️♀️ Body Fit has landed in the U S of A

💰 DoorDash is trying to boost its bottom line

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Qantas rides industrial property boom into the cash-filled sunset

Background: Qantas has had a pretty tough couple of years. Let's see...international borders closed...over 330 days of domestic travel restrictions. All up, the Qantas CEO said COVID was likely to cost the airline $20 billion in lost revenue by the end of 2021. Yikes.

What happened: But in some much-needed good news, Qantas has banked around $802 million after selling extra land next to Sydney Airport. This piece of land was said to be the most valuable in the country, because of its prime position next to the airport.

What else: Qantas will use the cash to pay down some of their (very large) debt that's been building up during the pandemic. Once the deal is done and dusted, it'll be a record-smashing sale for industrial property.

So what's the key learning?

💡Industrial property is any property that's used for industrial purposes. Think warehouses, factories...pretty much anything that's designed to manufacture and store goods.  

💡Australia's industrial property sector is booming. In fact, it's tipped to hit $120 billion by 2025. And you can thank our COVID-induced online shopping addictions for that.

💡For every $1 billion of incremental online sales, an additional 70,000 square metres of warehouse space is needed. That's nearly 3 times the size of the MCG. So you can see why Qantas got a premium price for their juicy airport land.

Call Eddie Murphy 'cos Body Fit is coming to America (again)

Background: Body Fit Training was founded back in 2017 and is focused on high intensity training (F45-esque).

What happened: This crew have ridden the fitness boom pretty nicely. They're expecting to have around 40,000 members and 200 studios in Australia by the end of 2021.  

What else: Now, US fitness operator Xponential Fitness - a franchise operator that owns a tonne of different fitness brands in the US - has just bought Body Fit's intellectual property for $60 million. Under the deal, Xponential will grow Body Fit in the US and Canada.

So what's the key learning?

💡When a company creates a blueprint for success and wants to expand, there are a few ways to commercialise their IP.

💡We've got:

1. The strict franchise model. Ya know, the Maccas model. McDonald's give you a licence to sell their scrumptious burgies, but they'll tell you what your staff need to wear, control your marketing and set performance quotas. 
2. The licence model. Heard of CrossFit? This crew licence out their name and logo, but the licensee can market their gym with fewer rules. 

💡In this case, Body Fit has taken inspo from CrossFit and is getting paid $60 million by Xponential for the licence to open it in the US.

DoorDash prays to the ad Gods as it struggles to boost revenue

Background: DoorDash is the food delivery platform that was founded back in the US in 2013, and is actually the largest food delivery company in the US.

What happened: Despite serving more than 450,000 merchants and 20 million consumers, DoorDash has never seemed to turn an annual profit. In fact, it reported a net loss of $102 million in the three months to June 30. 

What else: So, DoorDash is thinking of some new ways to boost revenue. And they came up with...selling restaurant ads in the search results section of the app. Kinda like...exactly what Google does. 

So what's the key learning?

💡Companies are always looking for new revenue streams to grow, grow and grow. 

💡Delivery platforms make their revenue through a few key streams:

1. Restaurant commission fees (i.e. the commission that a restaurant pays when customers order meals via the app)
2. Delivery fees (i.e a portion of the cost of delivering the meal)
3. In-app advertising (at Doordash, it's a fee paid by retailers when when they get a sale on the platform)

Because commission and delivery fees tend to be fixed, the only lever to boost revenue is increasing ads. 

💡 And now they're using your data. DoorDash knows how many burgers you've devoured in the last month (and ice cream, ya snack fiend). Which means it can sell restaurant ads based on your previous behaviour. The world is watching, team.