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QSR Interview | By Fred Minnick

Staying FOCUSed
Steve Romaniello is building a strong portfolio with brands such as Moe’s Southwest Grill and Schlotzsky’s. But can he reach his goal of 5,000 units?
FOCUS Brands chief Steve Romaniello runs Moe's, Schlotzsky's, Carvel, and Cinnabon.

In the past two years, FOCUS Brands has made moves to position itself as one of the top holding companies in the business. This year, it purchased Moe’s Southwest Grill from Raving Brands for an undisclosed sum. FOCUS closed 2006 by buying Schlotzsky’s. Then there’s Carvel and Cinnabon. In 2006, a Carvel or Cinnabon opened every two days.

FOCUS’s acquisitions and development campaign beg the question: Can the brand avoid the pitfalls that have plagued other quick-growing quick-service companies?

We talked to Steve Romaniello, president and CEO of FOCUS Brands, shortly after the company announced the purchase of Moe’s, to find out.

When would you like to have the Moe’s deal closed? End of summer.

What changes do you plan to make with Moe’s? As much progress as Moe’s has made in the last 18 months in adding infrastructure, they still don’t have a lot of the infrastructure that we have. Generally speaking, the idea is to continue many of the initiatives that are under way. They are in the process of changing menuboards, introducing their first LTO, and making many significant operational improvements to enhance efficiency. We might be able to provide them additional resources to get them to execute those things better and faster.

How will FOCUS help Moe’s? FOCUS has a more robust corporate communications department, real estate department, development services, and architecture department. We have a bigger and more robust IT department. We have financial systems and financial infrastructure. We have a company-owned and -operated store division and a very large and fast-growing international division. We also have a pretty big non-traditional business. We are in 35 countries and have 500 or 600 units internationally. That takes a long time to build so that would be a good example of something Moe’s wouldn’t have that we’ll be able to add … and through which we will be able to add value.

How has Schlotzsky’s worked out? The business has incredible momentum. The franchisees have welcomed us with open arms. We’re seeing high single- to mid-double-digit sales increases just about every month. We’ve executed a new promotion, which was the first time the system had ever done three sandwiches at once. And there are franchisees who are claiming it’s among the most-successful promotions over the last 35 years of their existence. Obviously, I wasn’t here, so I don’t know that to be true, but I do know that they’re very excited.

FOCUS hadn’t previously operated company stores in mass on the street. We operated only in the stadiums and arenas. That division is doing great. In fact, we’ve already purchased one additional store, and we’re working on purchasing another and making further investments in that division.

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