Growth
Best Headhunting Strategy
Church’s Recruits Competitors
What if you could expand to new locations in less than 30 days and for less than $100,000? Church’s Chicken is doing just that by recruiting existing quick-serve operators to convert their stores to Church’s.
As of September, Church’s had signed three conversion deals for a total of 15 restaurants, or a third of its store openings for the year. Three Louisiana Chicken’s in Philadelphia, two Crispy Chick’s, a Chat & Chew, and several units of a defunct franchisee of an unmentionable competitor were all converted to Church’s last year.
According to Chief Development Officer Doug Pendergast, local and regional chicken quick-serves that convert can tap Church’s purchasing power, operational efficiencies, and labor savings. Fried chicken locations that have converted to Church’s are averaging a 52 percent increase in sales and 1.5 percent improvement in food costs, Pendergast says.
Best Regional Breakout
El Pollo Loco Goes National
It’s not what, but who you know, as the old business adage goes. Thus when management of the 380-unit El Pollo Loco chain decided it was time to expand nationwide, they took a “first who, then where” approach.
“If we identify a great operator who also has an infrastructure and development experience within a given market,” says Vice President of Communications Julie Weeks, “then we’ll conduct our due diligence on the market to ensure it meets our criteria for development.”
Some of the great operators who’ve signed on include Panera developers Mitchell Roberts and David Peterman in New England; Princess Street Partners in North and South Carolina; ABE holdings and Adam Velarde in the Chicago area; Applebee’s, Panera, and Chevy’s developer Ed Doherty in New Jersey and New York; Burger King franchisee Ellen Avery-Smothers in Virginia; and veteran restaurateurs Chris Elliot and Joe Uhl for the Atlanta area. Experienced El Pollo Loco franchisees Roland Spongberg and Dave Barrows develop Utah/Arizona and northern California respectively.
By the end of 2007, El Pollo Loco plans to add 30 new units, 10 company and 20 franchised. In all, the new development agreements will add almost 200 units over the next several years.
Best Tagteam
Co-Branded Carl’s Jr./ Green Burrito Take Off
On January 30, CKE celebrated the opening of its 300th Carl’s Jr./Green Burrito store in Livermore, California.
Dual-branding the two concepts began with Carl’s Jr. founder Carl Karcher and former Green Burrito chairman William Theisen in 1994 and advanced when CKE purchased Green Burrito in 2002. In addition to increased average unit volumes and profits, Green Burrito’s presence in more than 300 Carl’s Jr. locations throughout Western states gives it a presence just under the 360-unit Qdoba and 310-unit Baja Fresh chains.
Best Desert (or Dessert) Import
Cold Stone Opens in Middle East
With summer temperatures averaging more than 110 degrees in the United Arab Emirates, the ice cream business should be lucrative. That makes Cold Stone Creamery’s choice of a third international market a sensible—and profitable—move.
Cold Stone signed a franchise agreement in early 2007 with Dubai-based Apparel Group to open 40 locations over five years in the United Arab Emirates, Saudi Arabia, Kuwait, Qatar, Bahrain, Oman, and Jordan. The chain’s first Middle Eastern store opened in Dubai in October followed by three others by year’s end.
“The response from the community has been tremendous,” says Senior Manager of Public Relations Jami Clark. “People who have experienced our concept keep asking us when we are going to build a Cold Stone Creamery near their home.”
In addition to stores in Japan, Korea, and now the Middle East, Cold Stone plans to expand into China, Taiwan, Mexico, Indonesia, and Malaysia.
Best Gift to Our Neighbors
Moe’s Goes to Canada
Fast-casual burrito concepts are found in most corners of the U.S., but if you are north of the border, the occasional small, independent shop makes up most of the market. Thanks to a new unit that opened in late fall 2007, Moe’s Southwest Grill is one of the first U.S.-based Fresh-Mex concepts to enter Canada.
“There is very little in the fast-casual Southwestern segment in Canada, so we believe consumers are really going to embrace the Moe’s concept,” says Shane Silver, co-founder of Moe’s new area developer True North Brands.
Moe’s agreement with Toronto-based True North Brands is True North’s first area development deal. The company was formed in 2006 to secure the rights to develop U.S.-based restaurant concepts. Moe’s is the first concept it plans to develop in Canada. True North will open 40 units in the Ontario province over the next several years.
“We see a great advantage to entering a partnership with True North Brands for development of our first international units because it is a Canadian firm that has a good understanding of Canadian business, real estate, and consumers,” says Matt Andrew, executive vice president of Moe’s.