Franchise Blog

A lack of training explains how a Nashville-based fast-food eatery lasted less than a year here before closing its doors.

Fat Mo’s owner and franchisor Mohammad Karimy said the restaurant’s first Kentucky location closed May 13, after the partners could not transform the building at 1854 Russellville Road.

“By myself I opened up (several locations). I didn’t have any problems,” Karimy said. “But these two gentleman, unfortunately they couldn’t run it.”

There were also quality issues, like a lack of air conditioning and persistent flies, that led customers to call Karimy, he said.

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< a href=”http://www.franchisebrief.com/franchises/7-eleven-franchise.php”>7-Eleven is planning to convert its company-operated stores in the Washington area to franchises as part of a national strategy to become a fully franchise business.

The Dallas-based convenience-store chain has 951 stores in D.C., Maryland and Virginia, and 413 of them are currently franchises, according to 7-Eleven officials. Over the next five years, 7-Eleven expects to convert the remaining 538 company-operated stores to franchises.

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Award-Winning Franchisee Organization The Rose Group Steps Up to Corner the Philadelphia Market – National Bakery Cafe Brand Boasts 19 Straight Quarters of Positive Comp Sales

From a corner store to a national cornerstone of fast casual dining, Corner Bakery Cafe today took a large stride forward in its comprehensive growth strategy with the announcement of The Rose Group as CBC Restaurant Corp.’s first new franchise partner. Since the company’s first location in 1991 to its current reach of 98 restaurants across the country, Corner Bakery Cafe’s growth has been primarily through company owned and operated locations…until now.

“We were waiting to do it right,” said Mike Hislop, Chairman and CEO of CBC Restaurant Corp. “Over the past several years, we’ve invested heavily in new systems, prototypes and product innovation to ensure a best in class experience for our guests. Already more than 50 percent of our customers visit us more than once a week and we’re recognized as one of the leading caterers in the industry. After just completing our 19th straight quarter of positive comp sales and holding the highest average annual sales volume (almost $2.2 million) of any national bakery cafe brand, we feel we’re in a position to move our franchise program forward at an aggressive pace. The right partner can help us not only achieve our growth plans, but also add insights and value from their vast experience in their respective markets. We’re confident that after months of searching we found that partner in The Rose Group.”

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When Colleen Cavalieri launched her home-based business at the Naval Academy, she didn’t have to start from scratch.
Ms. Cavalieri, whose husband was transferred to the academy last fall, is the local franchise owner of TSS Photography, an on-site youth and sports photography company with more than 225 units across the country.
She signed a 10-year franchise agreement that gives her the marketing power of an established brand name and the security of a corporate network.

“We’re locally owned, but we’re nationally supported,” she said. “If something happens to us, headquarters is going to take care of customers.”

Across the country, entrepreneurs such as Ms. Cavalieri are starting franchise businesses. Demand is so high that between 2003 and 2005, nearly 900 new franchise concepts began franchising, according to Washington-based International Franchise Association. In Maryland, there are more than 13,000 franchise establishments with 180,000 employees on the payroll, the association found in 2004.

But as with any business venture, owning a franchise means hard work and commitment, with most agreements lasting about 10 years.

“You’re going to be involved in a long-term arrangement with this company so you want to make sure this is something you want,” said Terry Hill, a spokesman for the franchise association.

Although buying a franchise means “most of the bugs have been worked out for you,” he said potential investors must research their market and talk to other franchisee owners before signing on the dotted line.

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The Corner Bakery Cafe chain has granted franchise development rights to The Rose Group for 25 restaurants in the greater Philadelphia area. Rose Group, an Applebee’s franchisee, agreed to build the bakery-cafes–Corner Bakery’s first free-standing franchised units–over the next seven years.

The franchise agreement is the first for Corner Bakery parent CBC Restaurant Corp. since the company was acquired last year by Il Fornaio America Corp., Corte Madera, Calif.-based operator of the namesake casual Italian chain. Of the 98 Corner Bakery units currently in operation, four are airport locations franchised to HMSHost Corp., and the rest are company owned.

Mike Hislop, CBC chief executive, said the company plans to add five to six new franchisees each year, with the goal of expanding into new markets. The company will also continue to open stores in existing markets, particularly California, aiming for 15 percent to 20 percent growth per year.

Rose Group, based in Newtown, Pa., operates 54 Applebee’s franchised units, and recently launched a proprietary Irish pub concept called The Shannon Rose in Clifton, N.J. Under the agreement, Rose Group will also take ownership of three company-owned Corner Bakery stores in Philadelphia.

According to a Kaiser Family Foundation study, today’s overscheduled youth spend an average of 44 hours per week staring at some kind of electronic screen, creating America’s first generation to grow up disconnected from nature. Rather than “going green,” children are “going screen,” a trend Wild Birds Unlimited is combating with its new Pathways To Nature for Kids initiative.

“Today’s youth spend less time outside than any previous generation, depriving themselves of the emotional and physical benefits that come from having a bond with the natural world,” said John Schaust, Chief Naturalist at Wild Birds Unlimited. “For years, our mission has been to bring people and nature together by offering products that make enjoying the outdoors easier. With Pathways To Nature for Kids, we’re investing in children so they can reconnect with nature, and live richer, fuller lives.”

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I had spent a little time skimming Qdoba’s menu online before making my on-site visit, but somehow I took away the impression (thanks purely to my own imagination) that it was a full-service, sit-down restaurant.

So when The Grub Spouse and I pulled up and realized that Qdoba is just the latest in a long string of local slap-and-wrap, fast-casual, Mexican-food franchises, I was somewhat disheartened. I was really in the mood to be waited on – not stand in line at another Moe’s/Z-Mex/Tijuana Taco/Salsarita’s/Blue Coast Burrito clone.

I had little time to wallow in my disappointment. Even before we were able to sit down and strategize with a menu, The Spouse and I were intercepted at the head of the queue by the manager, who proceeded to share with us approximately three college-credit hours’ worth of Qdoba history.

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Founder of a 360-unit franchise system and former Chairman of the nation’s franchise trade association, Richard Rennick is recognized as one of the leading experts in franchising and is available for comment. Contact Amy Bannon at (202) 789-1940 to schedule an interview.

Rennick founded American Leak Detection, a high-tech service franchise headquartered in Palm Springs, Calif., which has more than 360 units in 40 states and a dozen foreign countries. He is president and CEO of TEAM Rennick, and often tapped by other franchise systems such as the Dwyer Group, Estrada Strategies, Great Harvest Bakeries, Roto-Rooter, Screenmobile, Two Men and a Truck and others to parachute into an existing franchise system, evaluate their business model, and recommend improvements to their programs and processes.

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Jo To Go Coffee franchise now offers an Incremental Franchise Fee Structure for entrepreneurs interested in opening their own specialty coffee franchise. The advantage of the new structure is that Jo To Go Coffee® does not require a lump sum franchise payment early in the process, which allows potential franchisees the opportunity to gain the information necessary for a commitment to the process.

Jo To Go Coffee®, in response to the needs and concerns of future franchisees, has developed an Incremental Franchise Fee Structure that allows entrepreneurs to take small financial steps towards the opening of their Jo To Go Coffee® drive-thru predicated on finding an approved real estate site first.

“The bottom line is that, even though Jo To Go Coffee® drive-thrus have enjoyed success, many folks didn’t feel comfortable putting out a lump sum franchise fee payment early in the process,” commented Jo To Go Coffee® Vice President of Franchising, Jonathan Lukens. “The new process allows franchisees to take ‘baby steps’ toward paying the franchise fee. It has already proven to be very popular.”

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San Diego Gathering Unveils Initiatives for “Putting it All Together”

Homes & Land’s recent 32nd annual business conference attracted a record 318 attendees representing approximately 20,000 real estate communities across the nation and Canada. The conference theme, “Putting it All Together,” emphasized Homes & Land’s new, multi-media initiatives and the brand’s comprehensive marketing package for real estate professionals. The May event was held at the exclusive Loew’s Coronado Bay Resort in San Diego, California.

The company unveiled new website and magazine initiatives and recognized its award-winning affiliate publishers. The company also launched Homes & Land University, the new banner under which its enhanced fully-integrated education modules are offered. Homes & Land’s corporate management underscored their commitment to supporting their affiliates with this innovative focus on training.

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With Pollo Campero restaurants in the U.S., Latin America, Europe, and Asia, Roberto Denegri realizes that people from different countries and different ways of life, really enjoy his company’s product.

“We believe that people are looking for new alternatives. People are willing to try new things,” said Mr. Denegri, president and CEO for Campero USA Corp. “It’s just the way we cook it, the passion our people put in the product. We start with a great product and great service.”

A restaurant chain known for its affordable fried chicken meals, Pollo Campero was first established in Guatemala in 1971 and in six other Central American countries soon after.

In 1994, a new period began for Pollo Campero as it launched a franchise program that would take the Campero concept around the world. The company decided to expand to the U.S. in 2002.

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Valpak and Budget Blinds announce partnership; includes promotion on over 44 million envelopes and 100 million coupon mailing

Every month, the familiar blue Valpak envelope brings unique on-envelope promotions and sweepstakes to consumers that typically feature cash and prize giveaways.

During the month of May, Budget Blinds, a leader in custom window treatments, will appear on the Valpak envelope and give consumers the chance to win $100,000 in prizes. 44 million Valpak envelopes featuring Budget Blinds and Kathy Ireland Home by Alta will be mailed to households throughout the United States and Canada.

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Marco’s Franchising LLC, the franchising arm of Marco’s Pizza, has announced the formation of MFS Leasing LLC to assist in the financing of new franchise stores.

Huntington National Bank of Toledo has provided MFS Leasing with an initial line of credit of $3 million for the new entity.

Marco’s has announced a goal of 500 units by 2010 and to be in 10 states by the end of 2007. There are currently 155 stores in eight states, primarily in the Midwest.

Marco’s Franchising president Jack Butorac acquired the franchise rights in 2004 to Marco’s from its founder, Pasquale “Pat” Giammarco.

College Hunks Hauling Junk, the innovative Washington, DC based junk removal company, which recently sold its first franchise in Central Florida, was recognized for its marketing efforts, winning 3 M-Awards and being named a finalist in 5 categories at the American Marketing Association’s annual event, which recognizes successful marketing campaigns. The young entrepreneurs were finalists in 5 categories and brought home the trophy for the following 3 categories: Corporate Identity, Company Website, and Marketing Campaign on a Shoestring Budget.

“It feels good to be recognized for our marketing accomplishments,” states Nick Friedman, President of College Hunks Hauling Junk. “I think the other finalists were surprised to see us win because they do marketing for a living and we do trash hauling. But the fact that we were able to turn a simple junk removal company into a million dollar enterprise in less than two years is a testament to our marketing strategies. I always tell people that we are not in the trash hauling business but rather the customer service and marketing business.”

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Camp Bow Wow, the leading doggy daycare and boarding franchise in North America, today announced that it has opened its first location in the state of Georgia. The camp, located in Fairburn, will be the first to serve the Atlanta community with Camp Bow Wow’s high-quality, pet-friendly hospitality. Georgia is the 17th state in the U.S. to open Camp Bow Wow facilities, which are also present in Canada.

“Local residents have been looking for this caliber of service in our community and we are enthusiastic about providing our furry friends a place to play and stay,” said David Kane, co-owner with his wife Suzi. “Atlanta is a dynamic part of the country full of animal lovers and Camp Bow Wow will fit right in.”

Camp Bow Wow has sold over 185 franchises, growing rapidly in new and existing markets, boasting 189% average growth year over year since it began franchising in 2003. So far, there are six other locations sold in Georgia, including Alpharetta, Buckhead, Duluth, Gainesville, Jonesboro, and Roswell. More franchise opportunities are available.

“Every time we enter a new market, we are thrilled to open our family to new pets and their parents,” said Heidi Flammang, Top Dog and CEO of Camp Bow Wow. “We are finding entrepreneurs across the country who revel in the idea of building a career around their passion for dogs, and the folks we’ve met from Georgia epitomize this commitment.”

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NexCen Brands announced today that Michael C. “Chris” Dull will become President of the Company’s Franchise Management Quick Service Restaurant (QSR) Division. Mr. Dull will lead all initiatives surrounding NexCen Brands’ franchise business development, including retail concepts and strategy. The announcement comes on the heels of NexCen acquiring Marble Slab Creamery on March 1 of this year, where Mr. Dull has served in a variety of progressive management roles for 13 years, including most recently as Executive Vice President of QSR Franchising.

During his time with Marble Slab Creamery, Mr. Dull has led the development and operational functions for the company to ensure long-term stability and growth. He has led an extensive franchise development program, working with prospective and new franchisees to manage all aspects of franchisees’ business development and financing. Additionally, Mr. Dull created and implemented a master franchising program that has resulted in Marble Slab Creamery’s international presence in Canada, the Middle East and Korea.

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Site to Lower Franchisee Costs with State-of-the-Art Communications, Ability to More Easily Share Best Practices and Reduce Paper Waste

Quiznos, one of the nation’s fastest-growing quick service restaurant chains, today launched MyQuiznos.com for North American franchise owners and corporate employees. The site is the foundation upon which future IT advances will be built to better align the organization and its franchise owners in meeting communications and profitability objectives.

“MyQuiznos.com will provide tools, information and communication channels to help franchise owners and the corporate office achieve the commitments laid forth in Greg Brenneman’s ‘Go Forward Plan’ for increased franchise owner profitability,” said Frank Hood, Quiznos Chief Information Officer. “Our vision, as we continue to strategically build out the site, is to create a virtual Quiznos community containing a wealth of relevant information while eliminating costly faxes, printing and video. These benefits will be enhanced by the free computers and printers being delivered to franchise owners to continue to raise efficiencies and create an optimized digital platform for our business model.”

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Cash Infusion Fuels Accelerated Corporate Growth and Continued Franchising Expansion

Houlihan’s Restaurants, Inc., the nation’s leader in stylish, casual dining, announced today that it has received more than $68 million to fuel national expansion of the newly positioned Houlihan’s brand and build on the success of its existing 105 franchise locations.

The financial transaction involved $28 million in private equity from Goldner Hawn Johnson & Morrison, a private equity investment firm based in Minneapolis, Minnesota, as well as $40 million from a new senior credit facility provided by Wells Fargo Foothill Restaurant Finance, part of Wells Fargo & Company (NYSE: WFC). Houlihan’s system-wide sales are projected to exceed $350 million for 2007.

“Partnering with Goldner Hawn and securing a line of credit gives us access to capital for carrying out our growth strategy more effectively,” said Bob Hartnett, Houlihan’s CEO.

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FranPoint’s Seasoned Franchising Team Takes on Restaurant Concepts Seeking Accelerated Growth

The modern-day founder of MaggieMoo’s and the former franchise development director of the recently acquired national ice-cream chain have launched a company of seasoned restaurant industry pros that is taking startup restaurant concepts under their wing and helping them reach the100-unit milestone. The new company, FranPoint Partners, is being dubbed the only one of its kind in the restaurant segment.

Led by Richard J. Sharoff, the former Chairman, President and CEO of MaggieMoo’s International, LLC, FranPoint Partners has already attracted the interest of several growing restaurant chains seeking to elevate their concepts. Sharoff purchased MaggieMoos in its infancy and developed it into a well-known brand, creating a franchise system and opening more than 150 units before selling it in July 2003. Sharoff was also one of the first multi-unit franchisees of Boston Market.

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Sunnyvale Santa Clara El Pollo Loco LLC Introduces San Francisco, Marin and San Mateo Counties to Leading Mexican Fast-Casual Concept

El Pollo Loco, the nation’s leader in citrus-marinated, flame-grilled chicken, announced today it has signed a multi-unit franchise agreement with Sunnyvale Santa Clara El Pollo Loco LLC led by Dave Barrows to open 11 El Pollo Loco locations throughout San Francisco, Marin and San Mateo counties. The new agreement is in addition to his current agreement to develop eight locations in Santa Clara County.

“We are pleased to have seasoned restaurant developers and talented El Pollo Loco franchise partners like Dave Barrows with our brand,” said Scott Gillie, Director of Franchise Development for El Pollo Loco. “We look forward to the important role he and his group will play in driving El Pollo Loco’s franchise expansion throughout San Francisco, Marin and San Mateo counties and raising awareness of the brand in Northern California.”

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