It’s been called the “single most successful marketing concept ever.” And whether or not this statement can be substantiated, the fact remains that franchises are a vital part of our economy that serve millions of people each and every day.
By Mallorie Ann Ingram
In 2014, according to IHS Global Insight, 770,000 franchise establishments employed 8.5 million Americans and created $840 billion in output, up 4.9% from 2013. And the outlook for continued growth looks bright. Total GDP for the franchise sector in 2015 is expected to increase 5.1%, exceeding projected U.S. GDP growth of 4.9% with franchise establishments growing 1.6% and franchise employment jumping 2.9%1.
Here in the Chattanooga area, savvy business owners lead successful franchises, including many of the most popular full-service and quick-service restaurant concepts — read on to discover how they first got involved in the industry and why franchising works for them.
1Source: IHS, Franchise Business Outlook 2015, Jan. 2016
Milan Patel, Orange Leaf Frozen Yogurt
About the corporate franchise: First started in 2008 in San Francisco, Orange Leaf’s goal is to have 1,000 stores worldwide by 2020.
Getting started: Milan Patel’s family runs an Exclusive Quarters hotel in Cleveland, which gave him plenty of business experience and sparked an interest in entrepreneurship. “My background gave me the confidence to run my own business, which served as a building block to run Orange Leaf,” he says.
Why it works: His tip for potential franchisees? It’s always a good idea to do your homework and research businesses before investing. “Franchising is great,” he says. “You come in with everything created.”
Location, location, location—Patel’s determination to build successful restaurants all begins with the where. His businesses all operate in close proximity of each other in a part of Cleveland he refers to as a “micro Gunbarrel Road.” As the area has proven popular with consumers, Patel feels being in a nearby location to other stores and restaurants can only help him grow.
Patel says his goals are simple. “Have good food, a clean place, and great customer service,” he says. “I love the fact that I run into people who say ‘Hey, it’s the Orange Leaf guy!’ or ‘Thank you for bringing this chain here!” It’s great to feel appreciated by the community.”
About the corporate franchise: First introduced in 1995, Noodles and Company now operates more than 330 quick service restaurants.
Getting started: Megan Swartz’s background in franchising (her family owns several Sonic Drive-In locations in the area) gave her a strong foundation. After graduating from college she was certain that she’d found her calling. “Once it’s in your blood, it stays there,” she says.
Why it works: Swartz believes that with its fresh food approach and endless customization options, dining at Noodles and Company brings a new twist to fast-casual cuisine. Additionally, with more people searching for healthy food choices, along with an increased awareness of food allergies and busy schedules that make mealtimes a speedy affair, fast-casual dining like Noodles has been successful.
“Noodles is great for Chattanooga, with its customizations and completely fresh food idea,” Swartz says. “It’s neat to see how locally sourced and ingredient focused we are, even as a franchise.”
Although each day in the restaurant business is different and presents many obstacles, Swartz is in it for the long run. “There may be challenges along the way, but having a good team makes all the difference in the world,” she says. “I know my team brings me a lot success.”
About the corporate franchise: Established in 1990 in Statesboro, Georgia, Zaxby’s has grown to nearly 700 locations across the U.S. Founded in 1945, 7,300 Baskin-Robbins stores can now be found in nearly 50 countries.
Getting started: When Shannon and Julie Brown moved from Greenville, South Carolina 17 years ago, they were dismayed to find no Zaxby’s locations nearby. Their solution? Open one. The duo now owns six area Zaxby’s locations (with a seventh set to open soon and five more planned) as well as a Baskin-Robbins.
Why it works: The Browns’ passion for the brands they represent, combined with their go-getter attitudes, have enabled their dream of running a business to come true. “It all depends on how bad you want it,” Julie says. “You have to let fear go and look past it. If you have a dream, pursue your passion.”
The franchisee couple cites the welcoming and supportive nature of the people in Chattanooga and their own commitment to the community for their business success. “There have been bumps along the road, but you have to do your best and learn from them because it makes you stronger,” Julie says. “The more good seeds you sow, the more good things you reap.”
About the corporate franchise: First founded in 1934 in Normal, Illinois, Steak ‘n Shake now has more than 500 restaurants in 29 states.
Getting Started: Debbie Richman’s involvement with Steak ‘n Shake started early in her life—she was a Steak ‘n Shake waitress in Indianapolis when she was 15. This teen job helped her realize a passion for being around people in the restaurant industry and laid the foundation for her future as a franchisee.
Why it works: The franchising option appealed to the Richmans because all the business particulars are in place before you begin. “Having an entire company, proven brand, and system handed to you is fantastic,” Matt Richman says.
Debbie successfully ran a host of Steak ‘n Shake locations, and when her sons, Matt and Mike, showed interest in the franchise life, they joined their mom’s business to help make it even better. Their company, Debo’s Diners, now operates seven Steak ‘n Shake locations.
For the Richmans, being franchisees is a family tradition that allows them to combine their strengths into a singular goal. “It’s neat when my mom walks into a kitchen and hears the sound of burgers grilling and sizzling,” Matt says. “She says it takes her back to when she was 15 years old again.”
About the corporate franchise: First founded in 1986 in Arlington, Virginia, Five Guys Burgers and Fries now has more than 1,000 locations across the U.S. and 1,500 more in development.
Getting Started: Glen Griffiths and Jim Richards met while working at Krystal corporate and decided to put their experience to good use by starting their own company, GPR Hospitality, to manage and invest in Five Guys Burgers and Fries locations.
Why it works: For this pair, choosing to be franchisees was a simple decision, especially with the strategies and business operations already in place. “It’s a wonderful feeling to get up in the morning and see a plan come together,” Jim says.
The duo did plenty of homework before deciding to invest in Five Guys, an eatery that Forbes magazine cited as one of the fastest growing chains in the country. Since 2007, Glen and Jim have continued to expand their operations to a total of eight franchise locations in the South, with a ninth location opening late summer 2015.
Franchising isn’t for everybody. However, for this duo nothing beats choosing a proven brand and concept with everything ready to go. “You have to do your research, be involved as the owner, and work your tail off,” the pair says. “This is the most important part of franchising.” For these business partners, loving their work is their secret for long-term success.
About the corporate franchise: Founded in Decatur, Georgia in 1964, Huddle House now has more than 370 restaurants in 21 states.
Getting started: Gregg Hansen’s roots in the restaurant business run deep— he worked at Jack in the Box in high school—so his career as a franchisee comes naturally.
Why it works: As many franchise owners can attest to, having a business with a proven model and no need to create concepts from scratch is a major part of the appeal. “A large part of my day is executing the model successfully,” Gregg says.
After getting a taste of the food industry as a multi-unit supervisor at Jack in the Box, Gregg’s career then led him to a portrait company before he finally opened a door to franchise ownership.
Gregg is a firm believer in not having to recreate the wheel, which makes franchisee the perfect job title for him. And the success he’s found through Huddle House has been a swift development—he opened his first location in 2007 and evolved from there to be the chain’s largest franchisee member in the U.S., with 19 Huddle House restaurants in multiple states throughout the country.
So how does Gregg juggle the ownership of nearly 20 franchise locations? Simple logic, he claims. “It really is the people that you surround yourself with that make the growth and execution possible,” he says.