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Gauging Economic Climate’s Impact on Multi-Unit Franchisees’ Businesses

GARRETT:   “The economy hasn’t affected our Newk’s Express Café locations negatively, and this year has been better than 2011 so far. Last year we opened our fourth restaurant in the Memphis market. That restaurant has done extremely well in its first year and the three existing stores have experienced double-digit increases in same-store sales this year.

Newk’s is a great lunchtime concept, and we have found that when people are at work, they are going to eat lunch. If we’ve seen a sales drop off, it has been in catering from pharmaceutical representatives, but people are still coming in to the restaurants regularly for lunch and dinner.

Even throughout the recession, people still need to eat. We never saw a decline in sales, which I attribute to our superior product and great service. People are willing to pay for quality and service. Those are the two main things that will make a customer choose your restaurant over a competitor when money is tight. We focus on making sure every customer receives excellent service and a great menu item in a timely manner.

As the economy keeps improving, I think you will see even more improvement in the restaurant industry. We plan to capitalize on our momentum and keep growing so we plan to open at least two restaurants next year. I have seen more restaurants as a whole open over the past 15 years, and I think the restaurant industry will just keep growing as the years go on.”

Daniel Garrett is the owner and Nick Lancaster is a managing partner of Danco, LLC, a franchisee of four Newk’s Express Café restaurants in Memphis, Tenn., and one restaurant in Springfield, Mo. They will open at least one more restaurant in Memphis and four more in Missouri in the next few years. Garrett can be reached at danielgarrett@dancocafe.com and Lancaster at nick@dancocafe.com.

HANSEN:  “There is no doubt that the economy continues to present very serious challenges to the small-business community. Throughout my career as a franchise business owner, I have learned to focus on those aspects of the business that I can control. With seven Bennigan’s locations in Michigan, that meant reinvesting a significant amount of money in the past year to refresh two of our restaurants in Saginaw and Mount Pleasant. We had seen the sales increases that the chain’s corporate prototypes enjoyed, and we knew that a similar commitment to enhanced service and increased operational standards would be worth every penny.

When our guests’ disposable income is put into their gas tank, they obviously have less money to spend dining out.  For us, that means we must deliver legendary service every single time they walk in the door. It’s more important than ever to retain their loyalty, focus on the guest experience and allow our guests to create an emotional connection to our brand. We have trained and retrained our servers, knowing that legendary service and food are going to be what weathers the storm.

Overall our sales are up two to four percent year over year. We are determined to stick with the guiding business principles that have brought us success over the past 40 years. We pay what we owe, we don’t over-extend ourselves, and we look for opportunities to reinvest wisely when we can.

Being part of a multi-unit chain like Bennigan’s, which also embraces these principles and is focused on making every guest experience count, really gives us the support we need in these tough times. At the state level, we have been helped immensely by an active Restaurant Association and a new governor who is pushing through business-friendly legislation to help jump-start a Michigan turnaround and give back as much as we can.”

Brad Hansen is CEO of Labelle- The Sweet Onion Inc. with seven Bennigan’s restaurants in Michigan.  He can be reached at 989-429-8422 or bhansen@labellemgt.com.

ROME:  “The average Woodhouse Day Spa location has experienced very impressive revenue growth over the past year, and I expect this to continue in spite of the unstable economic climate. I don’t see any indicators that would prove otherwise and with the holiday season fast approaching, I think the outlook is bright system-wide.

Although there are a multitude of factors that affect growth, or lack thereof, within our industry, I believe our success can be attributed to a few key factors. Our brand has developed into one known for its excellence in customer service, quality of services and variety of service offerings. We place value on the entire spa experience, not just the services themselves.

I firmly believe that any service-based business providing a high quality experience, along with dedication and care to both its guests and team members, can grow even in tough economic times. These are factors that separate truly great businesses from average concepts. Great businesses can grow, or at least hold their own, in almost any economic climate.

I think the stressful world in which we live, along with the changing attitude toward spa services, is another contributing factor to our growth in a flat economy. There is no doubt that the stress we live with today affects the body in a negative way. Most people are realizing that spa services should no longer be considered just a luxury or pampering. Spa services go a long way toward relieving stress and healing the body in a natural way. More and more people are incorporating spa services into their regular health regimen just as they do diet and exercise.

Consumers are becoming more aware of these facts. This is a big factor in why we continue to see growth in our industry regardless of the economy.”

Stuart Rome has been a business owner in the New Orleans, La. area for more than 20 years and operates Woodhouse Day Spa locations in New Orleans, La., Slidell La. and Franklin, Tenn. Rome is also a regional developer covering five states including Louisiana, Mississippi, Alabama, Tennessee and the Florida Panhandle.  He can be reached at 504-482-6652 or stuart@nola.woodhousespas.com.

 

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