What do Kikki.K, Crust Pizza, Oporto and Guzman y Gomez all have in common?

They’re all Australian brands (quite delicious ones, except for our stationery friends at Kikki.K) that tried to expand into the American market but haven’t quite taken flight or found traction with U.S. consumers.

In today’s edition, we’re going to take a look at Guzman y Gomez, who are now facing a class action lawsuit after their ill-fated mission to the Wild West. More burritos for Aussies, I guess!

More than 500 former U.S. employees of Australian fast-food chain Guzman y Gomez (GYG) have launched a class action lawsuit in the United States.

The legal challenge comes a week after the company shut down its U.S. stores, saying its success “was not translating” to the American market.

Court documents filed in the U.S. state of Illinois allege the company breached workers’ rights by failing to provide the legally required 60 days’ notice before terminating staff.

A spokesperson for GYG told TDA that the company is “confident we have met all of our legal obligations.”

Guzman y Gomez is an Australian fast-food company founded in 2006 by two American entrepreneurs.

The chain went public in 2024 after expanding to more than 220 stores across Australia, Singapore and Japan.

Last week, the company announced it would “exit the U.S. market” and cease trading effective immediately, citing poor sales performance.

In a subsequent class action lawsuit, former employees across six Chicago franchise locations allege they were unlawfully dismissed by GYG.

The complaint claims the company breached workers’ rights by firing staff without notice.

According to the lawsuit, employees were told of the closures, effective immediately, through an internal messaging platform on the night the announcement was made public.

In the U.S, employers are generally required under federal law to provide workers with at least 60 days’ notice before large-scale layoffs.

The lawsuit is estimated to represent around 500 employees seeking 60 days’ unpaid wages and benefits.

In a statement to TDA, a GYG spokesperson said the company was aware of the legal challenge but was “confident we have met all of our legal obligations to our U.S. employees.”

Reporting by Achol Arok.

Long-term vs short-term investing: which is right for you?

-  Long-term investing means holding your investments for years to grow steadily and benefit from compounding returns. 

- Short-term investing focuses on quick trades to ride market swings.

Many investors combine both: a stable long-term “core” with short-term “satellite” trades for flexibility.

^{Transparency: This is a sponsored section of the newsletter. It’s the best way we can keep this newsletter free for you. Information is general in nature. Investing carries risk. To find out more, you can visit commsec.com.au}  

Regional banks are warning a major ATM expansion backed by some of Australia’s biggest lenders could put more pressure on smaller branches in rural communities.

NAB, ANZ, Westpac and Bank of Queensland are among the banks supporting a proposal to install or upgrade fee-free ATMs in regional areas, allowing customers to withdraw and deposit cash without extra charges.

But smaller lenders say the plan could damage the viability of regional branches already under pressure from declining cash use and years of closures.

Here’s what to know.

Bank branches across Australia have steadily closed as more customers move to online banking and use less cash.

Reserve Bank figures show the number of bank branches nationwide has nearly halved since 2011, falling to about 3,360 by June 2024. Over the year to June 2024, 230 branches closed, with more than a quarter of those closures in regional and remote areas.

In many smaller towns, local branches are still used for services that cannot easily be replaced online, including cash handling for businesses, face-to-face support and banking access for older Australians.

Regional lenders argue they are now carrying much of that burden, despite having much smaller customer bases than the major banks.

They say those pressures have only intensified as concerns grow about Australia’s cash network and the financial strain on cash transport company Armaguard.

A new proposal, backed by the Australian Banking Association, would roll out 20 fee-free ATMs across regional and remote Australia as part of a five-year trial.

The machines would offer free withdrawals for customers using Australian-issued cards, while some locations would also allow deposits.

NAB, ANZ, Westpac and Bank of Queensland have signed on to the proposal, while Commonwealth Bank and Macquarie have not joined the trial at this stage. (Just an editor’s note: Today’s newsletter is sponsored by Commonwealth Bank, but it has had no influence over this piece.)

The Australian Competition and Consumer Commission (ACCC) is now considering whether to approve the trial.

The Reserve Bank has indicated it supports the proposal in principle, saying it could improve access to cash in areas with limited banking services.

Regional and customer-owned banks argue the major lenders can afford to run the ATMs at a loss, while smaller institutions cannot.

A coalition representing smaller lenders told the ACCC the proposal could create an uneven playing field, accusing the major banks of using their scale to dominate regional banking access.

They warn the ATMs could make it harder for smaller branches to remain financially viable, potentially leading to further closures in country towns.

Some lenders also argue ATMs alone cannot replace full-service branches, particularly in communities where residents rely on in-person banking support.

The major banks reject claims the proposal is anti-competitive, saying the goal is to improve access to essential banking services in underserved areas.

Smaller lenders have instead proposed a rural banking levy on Australia’s nine largest banks.

Under the plan, the levy would raise an estimated $153 million each year to help support regional banking services and maintain branch access in rural communities.

The ACCC will decide whether the ATM trial can go ahead.

Reporting by Lachlan Keller.

Australia focused vs international ETFs: expanding your world

Many investors start with Australian ETFs (Exchange Traded Funds) – they’re familiar and give exposure to local companies and industries. But adding international ETFs can open the door to industries and businesses that aren’t well represented in Australia, like global technology.

Investing globally can also help reduce home-market bias and spread risk across different economies and currencies.

Some ETFs even offer currency hedging, which aims to reduce the impact of exchange rate swings on returns.

^{Information is general in nature. Investing carries risk. Consider the offer and Pocket T&Cs, and other fees and charges at commsec.com.au before deciding.}

Big news for the aviation nerds among us.

Melbourne Airport has announced it’s moving away from allowing passenger pick-ups and drop-offs at terminal doors. (Hollywood would hate this.)

What does it mean for you? Later this year, drivers won’t be able to pull up directly outside the Qantas, international or Virgin terminals to pick up or drop off passengers.

Instead, cars will stop at a new transport hub nearby and passengers will then walk to the terminal via a pedestrian bridge.

So essentially, it means more walking. Airports love to make us walk.

Reporting by Lachlan Keller.

Before we go, we thought we would finish the newsletter with something a little different today.

As we all know, the cost of living is rising. The latest inflation numbers told us that prices increased by 4.6% over the past year - their fastest rate since 2023.

So, we spoke to Melissa Browne, a former financial adviser turned financial educator, about ways we can all save money. Here’s what she said.

(And just a quick note: Any advice in this article is general in nature and does not take into account your personal financial situation, needs or objectives.)

Ask for a pay rise: With the new financial year coming up, some of you might be entering pay review time. Browne’s tip: focus on your performance and responsibilities, rather than rising living costs.

Negotiate with your bank: If you have a mortgage, Browne said many Australians are paying a “loyalty tax” by staying on older mortgage rates. She told TDA a quick phone call to a lender asking for a better deal could save borrowers hundreds of dollars a month without needing to refinance.

Check for unclaimed money: Browne encouraged Australians to search for lost superannuation, forgotten bank accounts, and government-held funds through the Australian Taxation Office and ASIC’s MoneySmart website.

Renegotiate household bills: Insurance, internet, utilities and subscription services are among the bills Browne said Australians should regularly review. She said companies often offer retention discounts to customers who threaten to switch providers.

Sell unused items: Browne said Australians could make extra money by selling unwanted clothes, furniture, textbooks and electronics online through marketplaces like Facebook, Gumtree, Depop or eBay.

Reduce food waste: Browne said food waste is another overlooked cost for many households, with the average Australian family throwing out around $50 worth of food each week. Something to take note of!

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Reporting by Lachlan Keller.