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Sweetening a Multi-Unit Deal

Franchising’s high-achieving multi-unit franchisees share views on key topics of the day.

QUESTION: What most affects your acceptance of a multi-unit deal with a particular brand?

FOLTZ: “We have only signed two multi-unit deals, one in 1989 with Cinnabon and another a little more than three years ago with Jamba Juice. Cinnabon was very unique at the time and was stringent about selecting sites and the process you needed to go through to even become a franchisee. This protects your investment and gives you confidence in the long-term growth of the brand.

“With Jamba Juice, it was all about the brand and the product. Our stores were doing very well and it offers four dayparts, which is extremely hard to find in this business. We get a strong breakfast wave with oatmeal and fresh juices, great lunch traffic with food pairings and smoothies, an after school or workout quick treat and a strong evening/dinner business. We also knew it was unique to combine great taste, healthy and fun all in one brand, so that gave us an edge.

“Once we knew the brand would be strong for the next 10 years, we looked at protection as the number one factor. The ability to secure the rights to a large geographical area was very important because it allowed us to market and grow the brand at our pace and style. Buying power was the last element we looked for in both Cinnabon and Jamba Juice. Both brands have controlled costs and have strong plans to maintain that over time. We also felt that both brands have carved out a ‘niche business’ that will keep us competitive in the market. You need all of this in place when you sign a long-term deal, yet have no control over government regulations that might be passed that are detrimental to the bottom line of your business.”

Steve Foltz, who runs Cinnamon Bums, Inc., now has 23 franchise locations in Oregon and Southwest Washington. There are three Cinnabon, 19 Jamba Juice and one Seattle’s Best Café locations. Foltz can be reached at sfoltz1023@comcast.net.

SHAH: “Consistent superior home office support is the biggest reason I chose to invest in multi-unit agreements with my current brands.

“A colleague of mine who owned three 7-Eleven franchise stores that were all doing very well introduced me to the brand’s investment opportunity. He had nothing but great things to say about the home office and the support he was receiving on a weekly basis. I decided to partner with him in 2009. Franchising has always been an attractive investment to me. As a practicing attorney, I know the benefits of joining a proven system with a collection of ongoing processes and support structures in place. Shortly after partnering with my colleague, I saw an unlimited amount of opportunities with 7-Eleven and other established franchise systems. As a result, I recently reached an agreement with 7-Eleven to open two additional units and I am excited to help grow the brand throughout the region.

“Additionally, I pursued other franchise investments through a comprehensive due diligence process. During this discovery process, Childrens Lighthouse Learning Centers caught my attention. I saw it as just the right fit for the region where I live and work in New Jersey. The area has a void in educational childcare options for families and I decided to capitalize, while also realizing the benefits Childrens Lighthouse would be to the community.

“A little more than a year ago, I reached an agreement with Childrens Lighthouse to bring three centers to the state. My first school is open and I am proud to be the first franchisee in the Northeast section of the United States. My second and third locations are in the site selection process right now.

“7-Eleven and Childrens Lighthouse may be different in scope, but they are similar in support structure. The Childrens Lighthouse home office has been exceptional and responsive to all my questions and needs. Without that support, I would have never decided to be a multi-unit franchisee.”

Ankim Shah owns three 7-Eleven franchise units in New Jersey with two more units set to open in the first quarter of 2014.  Shah recently signed a multi-unit deal with Childrens Lighthouse Learning Center to open three centers: one in Woodbridge, N.J.  and two more locations will open by the end of 2014.  Shah can be reached at ankim.m.shah@gmail.com.

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