For Markham, Ontario-based yogurt chain Yogen Früz, the goal has been to permit would-be entrepreneurs getting into business for themselves -- without being by themselves -- as owner-operators. "We stress customer service and product quality, and we believe that this can be best delivered to the customer through an owner-operator who is at the location all the time," says co-founder Aaron Serruya.
Yogen Früz has grown to 1,200 locations in 25 countries by offering consumers healthy and functional alternative treats. The growth plan calls for adding 1,000 new locations during the next decade, with a focus on Europe, Asia, and Persian Gulf countries, Serruya says. A major recent initiative has re-branded the concept, with a new store look appearing alongside a raft of new flavors.
At Dunkin' Donuts, the emphasis is less on new and different and more on tried and true. "We refer to it as ‘quick quality,'" says Grant Benson, vice president of franchising and market planning for the Canton, Massachusetts-based restaurant franchiser. "We can get people in and out of stores fast, but it's a quality product."
While serving up tasty coffee and food to customers, Dunkin' presents franchisees with the chance to partner with a company that has lengthy experience in franchised restaurant operations and iconic name recognition yet plenty of room for growth. "We have a brand that has close to 7,000 locations in the U.S., yet we are very heavily concentrated in the Northeast, Middle Atlantic, and Florida," observes Benson. "Very few brands have the opportunity in so many markets to develop very aggressively."
And the company does plan to develop aggressively, targeting markets east of the Mississippi where they have an existing presence but room to fill in. "Regardless of economic times,
Dunkin' has always been among the very top in the restaurant business in terms of new unit growth, and we'll continue to do that," Benson says. "I couldn't cite specific numbers, but we would be near the top, if not at the top, in number of new locations this year."
CiCi's Pizza has shown up at or near the top of some recent industry rankings of per-store sales growth. That does a lot to polish the Coppell, Texas, restaurant franchise's image to potential franchisees. With regards to consumers, CiCi's restaurants tend to do well in economic downturns, in part because of pricing, says J. Forbes Anderson, chief strategy officer. "CiCi's pizza has positioned itself as a value brand," he says. "With Americans reemphasizing value, I think we're poised to take advantage of that."
Today, CiCi's has approximately 630 locations in 35 states. The company's goal is to open 40 new stores a year for the next few years. Target markets include Southern California, Phoenix, Miami, Chicago, and Philadelphia. "Our expansion plans are really coast to coast," says Jim Sheahan, vice president of franchising.
Would-be entrepreneurs in any market like the low initial investment and high potential business opportunity from AdvantaClean, says Jeff Dudan, founder and CEO of the Huntersville, North Carolina-based franchiser of air duct cleaning, mold remediation, and emergency service businesses. The company's home-based franchisees enjoy modest ongoing overhead costs. "That's as a result of a lot of the background services we provide franchisees, such as answering the phone, customer service follow-ups, and operating platform," Dudan says.
AdvantaClean can also make a claim that its market demand is not much affected by economic trends. "These are nondiscretionary services," Dudan says. "When your house floods, you have mold or vermin in your air ducts, or you're bringing a baby home, people are going to buy this service; they don't have a choice."
From 40 locations currently, AdvantaClean anticipates growing to 100 stores by the middle of 2011. Dudan says that they have locations inthe northeastern,southeastern, northwestern, and southwestern United States east of the Mississippi and are building on that in their expansion plans. "We have the corners tagged, and we're filling in quickly. We also have several deals in the pipeline moving out toward the West Coast," he says.
When it comes to the franchise industry as a whole, and to its leadership in particular, franchising consultant Spencer sees a lot of change in the pipeline. Specifically, she predicts significant turmoil over the next few years as established franchisee organizations transition to next-generation leaders who want to do things differently. "These kids are saying, ‘You worked like this with my father, my grandfather, my uncle; but that's not going to happen now, '" she says. "'Please teach me how to be a different franchise owner from my parents.'"
In some cases, the incoming generation of leaders won't be able to reconcile its vision of the future with the realities of staying within a franchise system. When that happens, new leadership will be required. As a result, Spencer expects record number of ownership transfers to sweep through the industry in the not-too-distant future. "People are going to retire, there's going to be no generation behind them, and they're going to have to sell their units," she says.
Clearly, while leaders are important in business, so is timing. And, whether you open a new location or bring a new vision of growth to an existing franchise, right now appears to be an opportune moment for would-be business owners to take a look at the offerings and consider franchising.
Barriers to entry such as the cost of real estate, interest rates, and labor availability have dropped to rarely seen levels, notes AlphaGraphics' Coley. "So many things are stacked in a new business owner's favor that, quite frankly, if you find a good brand, you should get going," he says. "Now's a perfect time."
