Growth | February 2010 | By Deborah L. Cohen
‘The International Plan’
Population. U.S. proximity. Financing. Footprint. The right partners. Those were just a few of the factors that mid-sized quick serve Wing Zone considered in choosing the first international market to represent its expanding brand.
The founders believed they had just one shot to make their international debut and they wanted to get it right. For years, prospects had approached the fast-growing domestic chain, offering to bring its largely college-oriented take-out concept abroad. But Wing Zone held out, seeking to maximize opportunities at home in a U.S. market that appeared plenty big enough to handle increasing demand for buffalo-style chicken wings.
Come the recession the picture began to look different, recalled executives with the Atlanta-based chain of 100 restaurants, which was founded on the campus of the University of Florida in 1991. So in early 2009—with domestic growth expectations slowed to about a dozen stores—they undertook serious plans to expand the concept outside U.S. borders.
“It became more of a priority as things domestically slowed down,” says Matt Friedman, founder and CEO, looking back on the process in early September. “We could then focus attention on the international plan.”
Mexico, Central America, Latin America, and the Caribbean, with their penchant for chicken, the world’s most popular protein, seemed logical choices. These markets were close enough to facilitate the affordable export of Wing Zone’s products and allowed for hands-on supervision by the operations team, just an easy hop from Miami International Airport.
Industry heavyweights such as KFC and Burger King had already demonstrated success in the region. In addition, there seemed to be room for a niche player devoted primarily to made-to-order chicken wings, with signature sauces that would cater to the region’s appetite for spicy flavors.
“Delivery concepts are really thriving in these markets,” Friedman says. “The buffalo wing as a core menu concept really hasn’t penetrated yet.”
Adds co-founder and CFO Adam Scott in the same September interview: “Central and South America—they’re not having the same economic struggles as the rest of the world is. That was definitely a factor in where we would start our initial push.”
While Friedman and Scott oversaw pieces of the broader strategy, including financing and legal, work on the ground was spearheaded by two newcomers: chief operating officer Casey McEwen, a former Wing Zone consultant with executive experience at chicken concepts including Mrs. Winner’s Chicken & Biscuits and Lee’s Famous Recipe Chicken; and vice president of international development Hair Parra, a Venezuelan-born franchising executive with longstanding expertise in Spanish-speaking markets.
McEwen would run point from Atlanta, providing Parra with marketing, training, and other resources from the operations team and leveraging key affiliations such as Coca-Cola for its renowned market research.
Working from a Miami office, Parra would function as the only executive exclusively focused on the international efforts, locating potential franchisees, suppliers, and other contacts critical to phasing in the new markets. He understood the competitive landscape, having previously brought brands such as Papa John’s and Domino’s Pizza into the region.
Poultry would be sourced locally, but the chain’s 15 proprietary sauces, including flavors like Sweet Teriyaki, Thai Chili, and Nuclear, as well as its signature fries, would likely have to be flown in from the states, at least in the short term.
Wing Zone determined the best partnership model for expansion into the region would be area developers, savvy insiders who knew the lay of the land, had access to financing, and offered established local connections. Unlike franchise brokers, they would also be directly accountable for performance with hands-on responsibility for restaurants.
“For us, we’re getting into business with people that are operating the business,” Friedman says. “Those first few countries we go to—the units have to be so buttoned up and focused. I don’t want to jeopardize that by selling franchises to a bunch of different people.”
Parra worked his extensive sourcing network to uncover a series of qualified leads. In mid-September, he and the team were entering late-stage negotiations with a Panama-based group of four young men whose strengths included strong family backgrounds in the restaurant and beverage industries. Panama, it seemed, was shaping up be the first non-U.S. market to house a Wing Zone restaurant.
The country, whose main trading partner is the U.S., serves as a strategic bridge connecting North and South America. Its thriving port of Panama City, with a population of 1.1 million, constant influx of tourists, and strong service sector, seemed ripe with opportunity.
“Panama loves American brands,” says William LeSante, a Miami-based international consultant who specializes in helping food and restaurant companies move into new markets.
“They’re going through a massive expansion now,” he says, noting the advent of several major shopping malls. “There’s a lot of building going on.”
McEwen, who spent time scouting Panama and El Salvador earlier in the year, had noticed other trends, as well, namely local eating patterns. Diners, he observed, were not harried like their U.S. counterparts and seemed more family focused. People sat down to eat; even at quick serves, tables turned more slowly. The primarily delivery-centered Wing Zone footprint would need some retooling.
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