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Smoothie King 'Zee Glad to be Afloat on Katrina Anniversary


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The Smoothie King Center boosts the brand's visibility in New Orleans.

Ten years ago, David Magri’s Smoothie King business was underwater—literally—as the levees in New Orleans broke after Hurricane Katrina passed through. This weekend, marking the 10th anniversary of the storm, he is relieved to say he and the city are back on their feet.

“I had 11 feet of water in my stores. It was crazy,” Magri recalls. The two stores that flooded were in Saint Bernard Parish, the hardest-hit area in the Lower Ninth Ward. A third store, by the University of New Orleans, did not flood but the neighborhood was closed.

The disaster wiped him out. “I was extremely depressed right after. I had a hard time getting motivated,” Magri says. “I still owed on the last store, $135,000, when the storm hit.”

Although area banks were lenient on loan payments for a time—Magri’s note was $3,200 a month but he suddenly had no income—that came to an end. “In December, two days before Christmas, I got a letter: Your grace period is up,” he says. “Luckily, I had my trailer.”

The trailer was the idea of his long-time manager, Tracy English. She convinced Magri to put a lone Smoothie King food truck, which had been developed a few years earlier for special events, in Saint Bernard Parish, where all the restaurants were closed and most of the people gone.

“I couldn’t see it at first,” Magri said, about how a trailer could do business in an area so devastated. But soon people started lining up for smoothies, and then when they got to the front of the line they’d ask for hamburgers, too. Rather than send them to the back of the line of the truck next door, serving sandwiches and po’boys, Magri got permission to make hot plates to sell as well.

“They charged us royalties,” Magri says about his franchisor, at the time owned by founders Steve and Cindy Kuhnau, but were willing to be flexible by allowing Magri to add food. “They wanted to see us survive,” he says.

Magri credits his ability to “have the stomach” to rebuild to his manager, Tracy English, and his business partner, Charlene Carrouche, who is the first franchisee of Smoothie King. Their operation does business under the name WAF, which stands for We Are Friends.

Magri was able to open one of the flooded stores in Saint Bernard one year after the storm, but he doubts he’ll re-open the second because so many people left the neighborhood and never came back. Before there were 70,000 people in the parish; today they’re barely at 30,000.

“I see a much brighter future ahead, because they’ve rebuilt the levees, they’re much stronger. They built the great wall of Saint Bernard, that’s a feat in itself,” he said.

He also puts faith in Wan Kim, the former Smoothie King franchisee in South Korea who bought the franchise two years ago and became CEO.

While at first planning to move headquarters to Dallas or Atlanta for greater accessibility, Kim decided to stay, and last year bought naming rights at the sports stadium, now called Smoothie King Center.

“Every day you see the name up in lights,” Magri says, which boosts his stores and all the others in New Orleans, although he acknowledges franchisees in other cities may grumble about the cost of the deal. “Wan Kim, he’s new. He’s young. He’s got a different vision. Hopefully he can take us there.”

 

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The latest news, opinions and commentary on what's happening in the franchise arena that could affect your business.

Tom KaiserTom Kaiser is senior editor of Franchise Times. He can be reached at 612.767.3209, or send story ideas to tkaiser@franchisetimes.com.
 
Beth EwenBeth Ewen is senior editor of Franchise Times. She can be reached at 612.767.3212, or send story ideas to bewen@franchisetimes.com.
 
Nicholas UptonNicholas Upton is restaurants editor at Franchise Times. He can be reached at 612.767.3226, or send story ideas to nupton@franchisetimes.com.
 
Laura MichaelsLaura Michaels is editor of Franchise Times. She can be reached at 612.767.3210, or send story ideas to lmichaels@franchisetimes.com.
 
Mary Jo LarsonMary Jo Larson is the publisher of Franchise Times Magazine and the Restaurant Finance Monitor.  You can find her on Twitter at
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