Red Mango Starts Franchise Incentive Program



No restaurant sector in recent history has exploded in quite the fashion as has frozen yogurt. Six years ago, frozen yogurt shops were a relic of a bygone era when chains like TCBY flooded the franchise landscape. Since then, literally dozens of chains have emerged around the country, building hundreds of units and attracting just as many franchisees. It certainly doesn't seem like one that needs franchise incentives to lure operators.

But that's exactly what Dallas-based Red Mango is doing. The froyo chain, one of the concepts that has led frozen yogurt's rebirth, this week announced a new set of incentives designed to spur the chain's growth in certain markets, notably the Midwest.

The "Pioneer Program," as it's called, provides franchise fee discounts to operators who open two locations within 12 months. The discount increases for those who open three locations within 18 months. In each case, the units must be open within six-month intervals, with the first unit open in six months, the second within 12.

The program is targeted at operators who open units in Texas, California, Ohio, Kentucky, Tennessee, Minnesota, Wisconsin, Maryland and Maine. The company wants to open numerous locations in those states this year. "The exponential success of Red Mango has come from opening stores quickly to meet the rising demand for our business," Miguel Foegal, Red Mango's president, said in a statement. "And we are actively recruiting more multi-unit franchise owners to be part of our incredible team."

Indeed, Red Mango and others haven't had trouble growing in recent years. Consider that the chain now has 220 units. In 2010, it had just 65. Chains like Menchies, Yogurtland and others have had similar growth. Then again, given the aggressive growth by so many frozen yogurt concepts, Red Mango's incentive program could give the company an edge.

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News, notes and commentary on franchise financing, including SBA lending, both the SBA 7(a) program and the SBA 504 program, franchise finance programs, development incentives, big deals and startup lending.

  Mary Jo Larson is the publisher of Franchise Times Magazine and its sister publication, the Restaurant Finance Monitor. She is a frequent speaker at meetings and conferences, and at the Restaurant Finance & Development Conference. You can find her on Twitter at @mlarson1011.
  Reporter Jonathan Maze covers restaurants and finance for Franchise Times. He also writes for our sister publication, The Restaurant Finance Monitor, and writes a daily blog on the restaurant industry at www.restfinance.com. You can also catch him on Twitter at @jonathanmaze.

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