.
COVER STORY
PostNet's Steven Greenbaum is the consummate risk-taker, and therefore, his business partner Brian Spindel concedes, the true entrepreneur between the two of them. It was Greenbaum, after all, who wanted to take their original business of helping independent mail centers get started and turn it into a franchise. Spindel—who says he deals with the "nuts and bolts" of the business as president/COO—acknowledges that he was against the decision initially, but once they looked at the competitive landscape, he grudgingly admitted franchising was the way to go. |  |
FRANCHISE FOCUS
Development Agreements
Features
These days, few shoppers walk onto a used car lot without arming themselves with the trunk-loads of information available on the Internet. They often know the exact car they want. They know about its mileage, its history, its quality and, most important, whether there's a cheaper one down the street.
Hotels & Hospitality
Hotels try to pack in the amenities
Branded hotels might want to follow the lead of an independent whose "Guppy Love" program provides guests with a live goldfish so they can enjoy "completely stress-free bonding with these little buddies throughout their stay." Competition for the middle-income traveler who seeks amenities that blend work and play with style and affordability has driven hotel companies to pour millions of dollars into researching what guests want when they travel (hint: cookie-cutter hotels that look the same in every city is a big no-no).
At any of 55 Fairmont hotels or resorts around the globe, loyalty program members just pick up their key and go to their room. What makes the difference? Fairmont captures customer intelligence on guest preferences and previous behavior in a centralized database, says Sean Taggart, executive director of marketing in Toronto. The technology supporting paperless check-in also enables call center concierges to quickly arrange preferred tee-times, spa treatments, and welcome amenities ahead of time.
What are the tubes sticking out of hotels? These tubes are water slides, central pieces in water parks that are being included in more hotels around the country, especially the Midwest. Guests, it seems, are bored with the same-old hole-in-the-ground pools where the most fun involves diving in from the side despite signs pleading guests not to do such things.
Embassy Suites Hotels officials are hoping guests will fork over a little more of their cash at the new Flying Spoons marketplace concept, instead of having to leave the property to find dining and relaxation elsewhere.
PEOPLE
Executive Ladder
Franchising's movers and shakers
Franchise Profile
When Ellen Hui first got into the chicken business, she hid when her former coworkers came into the restaurant. Today, she’s diversifying into pizza, with plans to someday launch her own concept.
People
Lifestyles of the rich in franchise
We thought franchisee attorney Robert Zarco might be reluctant to open his home to us. After all, franchisees are known as the "Davids" in the fight against "Goliath" franchisors. Wouldn't they be afraid they couldn't afford his law firm? Quite the contrary; Zarco thinks his show of wealth sends a message to franchisors: "You'll never outspend us."
For seven years, Dave Giesen heeded that old saw: Don't quit your day job. He worked full time in medical sales, plus ran several Arby's on the side before deciding it was time to sink or swim. "Seven years into it, I realized I was going to have to quit my day job. I was going to have to depend on the restaurants," he says.
Profiles
Valerie Daniels-Carter uses her faith and positive attitude to run one of the largest black-owned fast-food holding companies.
UPFRONT
Currents
Pictures of Tejal Patel's artistic skill with henna designs on attendees at the Franchise Times booth, in keeping with the publication's branding ad campaign.
Buffets Holdings declares bankruptcy, Roark Capital closes on second equity fund, Sizzler on the block, Super 8 franchisees form association, Franchise associations form a coalition, NexCen gets into cookies, Management private equity buys Au Bon Pain, Lois Marshall
Highlites of the IFA Convention speeches and educational opportunities.
Pictures and higlights from IFA
Where’d all the Quiznos letters go?
No other subject produces more mail from readers than Quiznos.
Restaurants
If you're going to open a wing restaurant in Phoenix across the street from the stadium hosting this year's Super Bowl, what better time to host your grand opening bash than on Super Bowl Sunday?
Worst foods in America
Up Front
Interview with Sebastien Page, the marketing director for Source Book Publications, a network of franchise Web sites.
SPECIAL FEATURES
Departments
Exit Interview
I don't think people realize how difficult my job is. In the course of a routine interview for an article this month, I learned that the jean jacket I love is hopelessly out of style.
Fast 55
Dave Timlin is the chief executive of Yakety Yak Wireless, a burgeoning chain of wireless phone retailers and one of the few franchises of its kind. He believes the company's unique ability to adapt to each market is a big reason for its current growth—the chain has 71 units open, double the number it had a year before.
Door-to-Door Dry Cleaning, targets residential customers with a simple concept: The customer leaves their dry cleaning on the porch in the morning. A delivery person picks up the clothes that same day, and after they're cleaned, they're hung back on the door at the agreed upon time.
The concepts that make the Fast 55 list provide many insights into the success of the franchise business model. Only one company returns to this years list, an indication that fast growth is fleeting in the franchising world.
One day a few years ago Julie Burleson was in the kitchen of her Waco, Texas, home, cooking for the meal-replacement company she owned with Suzy Nettles. Her assistant that day was her 4-year-old son.
Parable Group tells growth story
Steve Potratz, a former music industry executive bought a Christian bookstore in 1985 on a whim while looking for a better lifestyle for his family.
In addition to our listing of the Fast 55, we've profiled six companies that are meeting the challenges of fast growth to see how they're coping with life in the fast lane.
For every franchise that used fast growth to propel it into a major national chain there are at least as many companies that grew too fast and imploded. Yet despite all the horror stories of problem franchises it's a hole many companies fall into. After all, everybody likes to grow and with a franchise it's easy to do with a strong brand and a good sales force. It's also relatively cheap because the franchisees are the ones making the investments.
WineStyles, the retail wine chain added 50 units last year. But Robert Spuck, the CEO, believes that 2008 will be the really big one.
BIZ WISE
Finance
We've all heard of green grocers and sustainable developers, but the Midtown Niki Group in San Diego hopes to be known as a green lender. The boutique real estate investment company has given Andrew Malk the title of director of acquisitions and sustainable finance and a mission, "to support eco-friendly retailers and restaurant owners." Malk seems perfect for the job.
Rough waters ahead for credit markets
As the recent spate of year-end 2007 earnings calls made plain, companies that depend on free-spending consumers—or at least free-spending American consumers—are uniformly bracing for lean times. Talk of a slowdown in discretionary spending has been building to a fever pitch for several years now, and judging by the tone of retail and restaurant executives, that slowdown has definitely arrived.
How To...
How to pack your whole life into a suitcase
Have you ever arrived at a franchise conference only to discover you forgot to pack your black shoes? For about half the population (metrosexuals excluded), this probably wouldn't be considered a crisis, but for a woman with a suitcase full of black pants suits, it's the stuff of which nightmares are made.
How to travel on business trips
Tips and insights from experts about staying healthy and alert when traveling.
Marketing
What is life like during a downturn? What guidance can we draw to help successfully negotiate a downturn?
Dealing with a competitor's spin is never fun, but easier if you are ready to respond. Setting spin straight can mean the difference between a successful business and one facing doom.
Operations
In a tough retail environment, smart operators try a combination of growing sales and reducing expenses.
Opinion
Most economists say we're headed for a recession, if we're not already in one. So how does a company succeed in a declining economy? We put the question to people who are thinking this very thing: company executives.
Profiles
Some refer to Gary Levy as "the accountant to the restaurant stars." "I hate that," he says dryly. "I'm not an agent. I'm not even a foodie. I just have the opportunity to work with some of the leaders in the industry."
Real Estate
Pioneering senior housing developer Jack West hopes to introduce the franchise world to assisted living.
For information on where the expansions and new locations are going up, as well as who the movers and shakers in real estate development are, refer to this page in this and future issues.
Technology
Coming to a cell phone near you
Coupon redemption in the digital age is less about traffic and more about targeting. That's what some restaurants are discovering about mobile marketing—allowing patrons to use their cell phone to download digital coupons, order via text messaging, or use the convenience to simply skip to the head of the line.
New technology and who is using it
LEGAL
Briefs
Legal issues in the franchising world
Nursefinders' competition? Nursefinders
Franchisees of temporary nurse staffing firm Nursefinders—what's left of them, anyway—have filed a pair of lawsuits claiming the company's recent expansions have left them at a competitive disadvantage against their own franchisor.
CFR
Appeals Court strikes IFA's amicus brief on non-compete clause issue
After a franchisee scored a victory last June in a $12 million lawsuit against the Atlanta Bread Company for terminating his five stores over a non-compete issue, the International Franchise Association attempted to have the decision reversed.
Columnists
This month's column discusses the steps in a successful restructure. One of the reasons for this topic is that filing bankruptcy is seldom the appropriate course of action for an overleveraged franchisee situation. A bankruptcy will extinguish debt, but in many cases, will also extinguish the ability of the franchisee to move he business forward.
Disputes
Norman Lindley opened three Contours Express locations in early 2006. The units he opened operated in the red and he found himself spending more than he anticipated opening and running the units. Within five months he was down at least $136,000.
The Michigan Dairy Queen Operators Association last month filed a lawsuit against the Minneapolis-based chain. The operators claim in the suit that Dairy Queen is trying to force them to change their units to either its "Grill & Chill" concept or a dual-branded treat-centered unit with Orange Julius.
Pennsylvania AG sues Pure Weight Loss
The Pennsylvania attorney general filed a lawsuit against Vahan Karian and his company, Pure Weight Loss Inc.
International
Should U.S. courts care what courts in other countries have said about issues relevant to matters arising in cases in this country.
