Greene Turtle, Denny’s, Edible attract ‘zees
Raj Rana will be the first to tell you launching a restaurant in New Jersey is an expensive proposition. A liquor license, for example, costs $1 million compared to roughly $50,000 in New York. A $45,000 franchise fee for the first unit and a nearly $1 million investment in building and opening costs top it off.
Yet Rana, who signed a deal to open 15 Greene Turtle Sports Bar & Grilles in the central and southern half of the state—a new market for the chain—believes the concept’s contemporary vibe and the region’s dense population will provide a decent return on invested capital.
“We felt the Greene Turtle had more of the characteristics of the new wave of restaurants than the old wave,” he says, referring to two uncles, who are partners in the venture.
The Greene Turtle, founded in 1976, operates and franchises 37 units in the mid-Atlantic. In 2007, the Hanover, Maryland-based chain was acquired by JPB Capital Partners, a private equity firm also headquartered in the state.
Opening a full-service restaurant is a delayed dream for Rana, a Canadian with an MBA. A former Subway franchisee, he longed to return to foodservice after selling his sandwich shops and taking a job in Toronto’s corporate world while his wife studied to be a physician and, later, did a residency.
Today, his wife having found work in New Jersey, Rana has teamed with his uncles who wanted to diversify their New Jersey gas-station holdings. They will help fund the opening of the first several Greene Turtles, he adds.
The partners’ territory includes Middlesex, Camden and Woodbridge counties, where the first restaurant opens this spring. “It’s right where Route 1 and Route 35 meet. There’s lots of competition in the area but there are also 350,000 people living within five mile of the intersection,” Rana says.
However, because Greene Turtle is relatively unknown in the Garden State, he and his uncles had to “sell themselves” to the landlord and banks.
Denny’s enters Atlanta
When we talked in mid-January, Donnell Thompson was just weeks away from opening his fifth Denny’s, in Snellville, Georgia, a city of 19,245 about 18 miles east of Atlanta. Another of his restaurants is under construction in the Atlanta suburb of Stockbridge (population 26,265). He also expects to open a Denny’s in Marietta this year.
“We continue to look for good locations in the Atlanta market,” Thompson says. The midscale chain, by the way, hasn’t had a presence in Atlanta for years.
This isn’t the former NFL defensive lineman’s first stab at franchising. Upon retiring at age 33 after 11 pro seasons, he bought a McDonald’s restaurant in the Atlanta airport, having learned the fast-food ropes during seven off-season stints with the burger giant.
He claims he increased sales in his first unit by $400,000 in its first year by actively involving the community and supporting local sports teams. Eventually, the chain opened restaurants too close to his and the franchise relationship soured.
Thompson, 56, operated six restaurants when he and McDonald’s finally parted ways after eight years. He then launched a construction company and became a Zaxby’s franchisee in Durham, North Carolina, his home state. Yet Thompson says he didn’t see much room for growth for the chicken chain and was looking for a different culture.
Meanwhile, after partnering with friend and former New England Patriots player Ron Wooten (now a financial services executive), the two opened their first Denny’s in Fayetteville, North Carolina, in 2012. Three more restaurants have followed in part because, Thompson says, the franchisor’s management is “conducive to his personality.”
“I looked at the leadership first versus just the brand. As a franchisee, you need to know who you will be doing business with,” declares Thompson, who, like many before him, likens the relationship to a marriage.
Curiously, Thompson is also working with an African Methodist Episcopal Church in Bowie, Maryland, to help it become a Denny’s franchisee. Pastor Jonathan Weaver of Greater Mt. Nebo says although plans for the eatery on land the church owns are in the talking stages, there has been “very active interest” from Denny’s officials. Thompson, for his part, will contract to manage the restaurant for a fee. “All the profits go to the church,” he says
Fruitful Southern California
Ibrahim Choudhry is seeking Edible Arrangements domination in California. The ambitious franchisee and his brother, Hashim, operate six units but plan to open more. They have plenty of time. Ibrahim, after all, has yet to turn 30.
Ibrahim, who was born in Pakistan and arrived in the U.S. as a child, began working for the Wallingford, Connecticut-based Edible Arrangements International when he was 19. He and Hashim were trainers, he says. Hashim became director of training while Ibrahim opened stores in the U.K. and Middle East.
The bug to franchise their own units eventually bit. Ibrahim recalls approaching founder and CEO Tariq Farid to share their plans. “When I told him this is what I’d like to do, he said he saw me becoming a vice president in the company. I told him my heart is really in this,” he says, adding Farid gave him his blessing. “He’s been such a mentor.”
The brothers’ real estate strategy has so far been opportunistic: Their units have been purchased from struggling franchisees who have not been aggressive enough in their marketing or operations, according to Ibrahim, who blames bad spending habits. “People are so far in debt. You have to put your profits back into your stores,” he asserts.
The Choudhrys operate units in Fontana, Laguna Hills, Claremont, Moreno Valley and Rancho Palos Verdes. The Moreno Valley unit produces award-winning sales. Ibrahim notes that surprises people because the Inland Empire town of 201,000 is mainly blue-collar. But customers tend to spend more per arrangement than those in nearby wealthier cities because it’s a significant purchase for them and they want it to be nice, he reasons.
Ibrahim declined to disclose the average transaction amounts or provide per-unit sales for his four stores, which he took over in 2008. Edible Arrangements’ franchise disclosure document shows its 734 stores open for four or more years averaged $512,213 a year in sales. The 1,060-unit chain has been adding 50 to 60 mostly franchised outlets a year since 2011.
David Farkas has covered the restaurant industry for 25 years as a reporter and food writer. Submit your company’s development agreements to him at email@example.com.