Winning strategies for franchises: key success factors

WHITE PAPER

SPONSORED BY:

By Robin Arnfield | Contributing writer, Fast Casual

2© 2016 Networld Media Group | Sponsored by Capriotti’s Sandwich Shop

This white paper helps franchisees and potential franchisees identify key strategies which will help their business succeed.

“In the sandwich shop segment, success depends on the ability to separate oneself from the pack,” said Bruce Evans, VP of franchise sales at Las Vegas, Nevada-based Capriotti’s Sandwich Shop.

When looking into franchises, prospective franchisees should focus on companies with a proven record for success. Ideally, this franchise would support its franchisees by provid-ing services like ongoing training, keeping construction costs low, developing innovative menus, maintaining efficient operational systems and having expert marketing assistance.

Anyone looking to own a franchise needs to evaluate franchisors to see if they have the fol-lowing winning characteristics.

Select a franchisor that will provide you with a winning scenario

“Capriotti’s was founded in 1976 in Wilmington, Delaware, and eight years ago our founder sold the firm to one of our franchisee groups in Las Vegas,” Evans said. “What sets us apart

WHITE PAPER

SPONSORED BY:

Winning strategies for franchises: key success factors

By Robin Arnfield | Contributing writer, Fast Casual

3© 2016 Networld Media Group | Sponsored by Capriotti’s Sandwich Shop

is that our owners have been Capriotti’s franchisees. They take very seriously the idea that we are successful because our franchisees are successful. We don’t try to nickel and dime franchisees to death and don’t make any money off of the things we sell to franchisees. We have a vested interest in helping franchisees succeed.”

Ashley Morris and childhood friend Jason Smylie bought their first Capriotti’s franchise in 2004. Four years later, they bought the entire company. Morris now serves as CEO of Capriotti’s, and Smylie serves at CMO/CIO.

According to an article on Fast Casual, Smylie introduced Mor-ris to Capriotti’s while they were both students at the University of Nevada-Las Vegas. They both became raving fans of the sandwich shop.

Fast Casual quotes Morris as crediting his and Smylie’s passion for the product as the key to their success, and also crediting Capriotti’s winning formula. “What’s great about fran-chising is that it takes a lot of the guesswork out,” Morris said. “We bought into a concept that was 30 years old, and had gone through multiple business cycles and multiple reces-sions. If the concept is successful, we have a higher likelihood of being successful.”

Keys to success

Drawing from his experience as both a franchisee and a franchisor, Morris identifies four keys to being a successful franchisee:

Trust the systemFirstly, successful franchisees must keep in mind that the system has been tried and tested by an experienced team, said Morris. Having a system with a proven track record in place makes it easier for franchisees to be successful.

Get involved in the communitySecondly, put a face on your business in the community. “Too many restaurants out there are like a machine,” Morris said. “In our business, we look at it from, ‘How can we deliver extraordinary customer service and not worry about turning tables?’”

4© 2016 Networld Media Group | Sponsored by Capriotti’s Sandwich Shop

Getting outside the four walls goes a long way towards telling customers that you care about them and that they are more than just a number, Morris added. Partner with local charities, get involved with the chamber of commerce collaborate with other brands, etc.

“We’re looking for people with a good attitude and business acumen to get into the com-munity and help build our brand so that we get recognized nationally,” said Capriotti’s Ev-ans. “You don’t need restaurant experience to become a Capriotti’s franchisee. It’s about getting involved in the community and putting a face on the business.”

Leverage technologyThirdly, take full advantage of the technology and reporting tools available to you. “The most successful franchisees embrace these tools, and that really helps generate margin,” Morris said. “The difference may be just 3 or 4 percent, but that’s a lot of money. Don’t just be happy with making money, be happy with making the right amount of money.”

Leveraging technology will accelerate both productivity and profit, helping you maximize efficiency and bring in more revenue.

Stay involved with the franchisorFourthly, stay involved with the franchisor. Participate in advisory committees, read com-pany newsletters and provide feedback. “You generally get out of it what you put into it,” Morris said.

Franchisee involvement is key to Morris’ approach. Morris relies on meetings, testing and focus groups with franchisees to gain insights and buy-in. He used that approach when making changes to Cheese Steak, one of Capriotti’s signature menu items. With a preparation time of around 10 minutes, the sandwich was slowing down service.

Changing a core product could have been a tough sell, but Morris kept in close touch with franchisees, and because he had their buy-in, the change was a great success. Quality of the product actually improved, and the preparation time was cut in half.

“Franchisees are the champions of our brand,” Morris said. “They are the policemen of the quality of our brand. We love that our franchisees care so much about the product.”

The food is the difference

Capriotti’s has found that offering home-style, on-premises cooking is a critical success factor.

“Our food is vastly different from anything else,” Evans said. “We are the biggest user of butterball turkey outside the grocery sector. We roast whole turkeys and beef in-house every day, and we also make home-made coleslaw, meatballs and tuna fish. We have a home-made food taste, as we’re doing things very differently to our competitors, which

5© 2016 Networld Media Group | Sponsored by Capriotti’s Sandwich Shop

creates a unique flavor profile. It’s not just sliced meat on a piece of bread, it also has a home-made taste.”

Fast Casual reports that Technomic’s “2015 Center of the Plate: Poultry Consumer Trend Report” found that diners are increasingly looking for menu alternatives. The Technomic study showed that 61 percent agree that turkey (versus 59 percent for chicken) is healthier than beef or pork. Additionally, the report found that more consumers prefer to order turkey-based substitutes such as turkey burgers and turkey bacon for breakfast, lunch and dinner, as they tend to be more familiar with these products than chicken-based substitutes.

Mom-and-pop feeling“Talking turkey: Capriotti’s builds big business on humble sub,” a January 2015 article in USA Today, says that Capriotti’s sandwich shops have “a bit of that mom-and-pop feel.”

“Open kitchens are typically set behind a counter area where you can see the sandwiches being made to order, and in some cases, the signature turkey being hand-pulled or shred-ded,” the USA Today article says. “The kitchens have grills where hot sandwiches like cheese steaks are cooked… staff at all the Capriotti’s I visited have been uniformly and exceptionally friendly.”

High-quality training

Providing high quality training is one of the most important things that a franchisor can do for you.

“Capriotti’s is very different in the amount of training we do for franchisees and the empha-sis we have on business principles and P&L, not just on how to make a sandwich,” Evans said. “So operationally, we have a different approach to franchisees than other firms in the sandwich shop sector.”

Capriotti’s helps its franchisees improve their ROI and also develop their franchise, for example through improved interpersonal skills for interaction with guests. It also has a strategy of value-engineering the build-out of new shops so that from start to finish costs do not exceed $370,000.

About the sponsor:Founded in 1976, Capriotti’s Sandwich Shop is an award-winning sandwich shop that remains true to its 40-year tradition of slow-roasting whole, all-natural turkeys in-house nightly. Capriotti’s homemade ingredients, hand-crafted subs and unique menu items have won numerous accolades including being voted “Greatest Sandwich in America” by AOL | Lemondrop and being recognized with numerous “Best of” awards in Delaware, Las Vegas, Dallas, Quad Cities, Eastern Shore and San Diego. The fast casual sandwich shop’s broad menu of cold, grilled and vegetarian subs, cheese steaks and salads are available at over 104 company-owned and franchise locations across fifteen states in the U.S. For more information, visit www.capriottis.com

Capriotti’s missionTo share our passion, one sandwich at a time.

Capriotti’s core valuesPassion – be the bestFamily – care about peopleIntegrity – walk the talkProfitability – everyone winsGenuineness – 100 percent real