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November-December 2015

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In this issue

Native Grill & Wings attracts capital

Dan Chaon, CEO of Native Grill & Wings, put together an unusual group of private investors, including himself, to purchase the system and set it up for more rapid growth. He wouldn’t disclose the amount of the capital infusion, but said Brad Williams, one of the largest Freddy’s franchisees in the United States, who has a 60-store development deal with that brand, is the other lead investor. Real estate players make up the rest of the small group. Plus, three daughters of Native Grill founders Floyd, now deceased, and Judy Anderson retain a small “legacy” stake in the brand. The Anderson family took a road trip from Buffalo, New York, to Arizona in the ‘70s, and started Native New Yorker in 1978. The name was changed to Native Grill along the way.

Youthful energy on the Latin American trade mission

It was our idea to pose Sergio Orozco next to a Lego man on the trade mission to Latin America. At 25, Orozco, international manager for Signal 88 Security, was the youngest member of our band of merry franchisors, and thereby, willing to combine work with play. On trade missions, you have plenty of downtime while traveling from airport to airport to get to know the other participants, but not as well as when you give them the Franchise Times Personality Quiz. Here’s how Orozco answered our probing questions:

Daughter’s zigzag journey leads home, to Epcon

An adventurous daughter ends up back home, learning her mother’s house-building business in a trial by fire. The younger partner’s wanderlust is still going strong, but the two have worked out a smart operating system.

Shattered devices boost uBreakiFix

Anyone who’s dropped a phone knows the pain of a shattered device, and uBreakiFix is gaining customers and franchisees in the aftermath. Can they convince enough people to repair rather than replace?

Star Trek’s ‘replicator’ inspires Burritobox

Well dressed and energetic, Denis Koci was in his element surrounded by a hungry gaggle of onlookers as he explained and demonstrated Burritobox, an automated burrito-doling machine he created that’s based on the “replicator” food machines in Star Trek. Koci, a self-labeled futurist, is a massive fan of the spacey TV series.

Dental Fix CEO learns lessons one sip at a time

At age 34, David Lopez has seen success and failure. Dental Fix RX is a prime example of the former; Froots not so much. He’s developed strong points of view along the way. Read on for his particular flavor of Kool-Aid.

Founders’ past mars future for Fresh Healthy Vending

Nicholas Yates is on a mission to put fresh, healthy snacks into vending machines instead of all that junk food. But a fast start in selling machines—5,500 to date—is colliding with the founders’ past.

Franworth aims to help small franchisors grow

Mentorship comes in all shapes and phases—sometimes you’re the mentor; sometimes you’re the mentee. It all depends on where in the ride you’re picked up.

Trying to make convenience stores, well, convenient

7-Eleven is testing delivery. The Cube is all about the drive-thru. How c-stores are trying to give customers ‘what they want, when and where they want it,’ as the grandfather of the business commanded.

Salsarita’s, a fixer-upper, getting back on track

After success at McAlister’s Deli, Phil Friedman bought Salsarita’s with a plan to revive the struggling burrito brand. It’s come a long way from the ‘washout’ days, but there’s plenty of hard road ahead.

Restaurants try carrots to lure shrinking labor pool

Better quality of life, such as two consecutive days off, is an attraction for restaurant workers. And Chipotle tried to hire 4,000 workers in one day this fall, serving notice that the competition is on.

Are these fast-casual trends hot or not?

Fast-casual restaurants are still new-ish, but they’ve been around long enough to develop some trends of their own. Our writer decided to analyze six items and declare their hotness—or notness.

Third-party delivery services gain traction

One Jersey Mike’s operator gets 20 percent of her sales through an outside delivery service, a nice bump. As third parties compete for No. 1 status, some wonder how to maintain their own image.

Salad-centric concepts experiment with ways to grow

Salads are ‘very, very low margin,’ one CEO says, but nonetheless a bevy of choose-your-own-greens concepts are competing for investors and customers. We provide a rundown of a leafy bunch.

These senior care brands invest heavily in R&D

Some senior services franchises simply provide basic care. But a handful are partnering with the likes of Harvard Medical School and a prominent Alzheimer’s expert to invest in cutting-edge research. Will it pay off?

Healthcare SOS: Time to take action on Obamacare

You’ve heard about the seven stages of grief. As the Affordable Care Act lurched its way into being, franchisees took a similar emotional journey. This June’s Supreme Court ruling sealed the deal.

Tech plays bigger role in real estate tactics

Although they’re not magic boxes, site selection tools can cut the risk considerably to operators seeking real estate. Massive data-crunching, right down to the number of dorm rooms on a college campus, is the driver.

Staying in touch takes effort as brands grow

Clear, regular communication is the key to success for any growing franchise. It has the power to make or break companies, and compared with legal fees, the cost of communication is downright tiny. So if communication with franchisees is that significant, why do many companies fall short?

Scoreboard

With extreme and hard-to-predict gyrations of global stock markets in recent months, it seems that many place greater emphasis on the slightest turns of phrase by the Federal Reserve and ignore the fundamentals.

Trade mission to Costa Rica, Guatemala and El Salvador

I pity the poor franchisor who doesn’t go on at least one international trade mission. While the missions are designed to match U.S. companies with investors in the selected countries, they also serve to brief franchisors first-hand on a country and its special challenges—or as we say in franchising, “opportunities.” Call it boots-on-the-ground education.

How to hold an epic annual meeting

A sense of fun helps, franchisors say, if only to stomach corny themes like ‘May the Fourth be With You.’ (That conference was held May 4th, get it?) The universal rule: The minute one is done, start planning the next.

Living Large: How to protect the brand

Some franchisors are too strict when enforcing brand standards, and some are too lax, observers say. For the three emerging franchises we’ve been following all year, it’s tricky to find middle ground.

Executive Ladder

Seeking to revive its franchising efforts, Shoney’s named Terri Harof as director of franchise sales. It’s a newly created position responsible for marketing, business development, sales strategy and franchise support.

Top 10 legal cases of 2015

We asked Franchise Times’ Legal Eagles to tell us the cases they’re following, and they obliged with a diverse selection and smart commentary.

Canada is stone’s throw away, yet different climate

In the early days of cross-border franchising, “international” for most U.S. franchisors was likely to mean a unit or two in Toronto. The picture today is, of course, far different with most well-known U.S. brands represented in one or more of the Canadian provinces.

Don’t become the scapegoat when a crisis happens

In 1871, a single cow was blamed (many say in error) for causing a fire that killed some 300 people and destroyed most of the city of Chicago. Of course, the cow was not entirely at fault. Mrs. O’Leary could have taken better care of her lantern. An error by a watchman sent the firefighters to the wrong address. Another alarm sent to a nearby courthouse failed to register. And, in the end, a small fire in a barn grew so fast it quickly overwhelmed Chicago’s undermanned fire department.

Early Five Guys’ operator tries pizza niche

To take nothing away from Jeff Percey’s award-winning operations acumen, it was plainly good fortune to counsel the founders of Five Guys Burgers & Fries during his brief tenure at an Alexandria, Virginia-based franchise development firm. In 2003, he left to become the burger chain’s third franchisee.
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From the Magazine

Publisher's Column

Here’s your kick in the backside

Mentors come in many different forms. At my first job after graduating from college, I didn’t have a formal relationship with my mentor, but she was a seasoned veteran of the company who liked me.

Loose Ends

If the shoe fits — wear it on either foot

There are bountiful lessons learned on franchise trade missions, such as the one I was just on to Latin America. Executives from the 13 companies who attended were privy to insider info on the culture, safety issues, supply chain logistics and the business opportunities of three similar, and yet, very different countries. I learned you can buy shoes that fit either foot.
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