Branching Out
QSR Magazine | Issue 98 | January 2007
| By Jamar D. Laster | page 1
As founder and CEO of Fransmart, Dan Rowe is leading
the charge for several regional brands looking to spread their wings.
He hated it.
That’s how Dan Rowe describes his admitted
apathy for the computer software business with which his career background
is intertwined. At first thought, the word “hate” might seem
a bit strong. But to hear Rowe tell the story of trudging the mundane
career path he chose in his early 20s, “before it was cool to be
a nerd,” hatred might be fitting.
“We were selling six-figure software systems
that apparently were very good because the biggest companies in the world
were buying them, but half the time, the software was never even used,” Rowe
says. “In the industry, we called it ‘vaporware,’ and
it wasn’t very inspiring to me.
“We worked in data centers around people
that hated their jobs, and who always talked about doing something different,” he
adds, “and it didn’t take me long to realize that I wanted
something different as well.”
Working amid the clear disdain and scorn of his
co-workers, Rowe knew a change was in order. He knew that to be successful,
he needed to be around motivated, success-driven people. So he heeded
the call of the franchise industry.
Rowe, founder and CEO of Fransmart, couldn’t
have chosen a more successful industry in which to immerse himself. After
all, in what better climate is there to grow the entrepreneurial spirit
than franchising? And those wanting a piece of the pie look to Fransmart
to satisfy their appetites. Rowe’s company provides strategic advice
to a growing portfolio of brands and companies, helping them grow successfully,
maximize unit economics, and achieve brand awareness in the restaurant
and franchise industry.
Need proof that Fransmart works? Check its track
record.
Fransmart helped guide Five Guys Famous Burger
and Fries through the sale of 300 franchises within the first 18 months
of working with the brand. Three years into the relationship, more than
100 new units have opened, with another 1,000 in development. And within
five years of taking Camille’s Sidewalk Café under its wing,
Fransmart helped open 100 units, with 1,000 in development worldwide,
including franchisees such as Aramark and HMSHost.
Leading the charge for the Fransmart juggernaut
is Rowe, who took a moment with QSR to discuss all things related
to growing a small brand into a big one.
Discuss
your involvement in helping to expand Qdoba Mexican Grill when you were
with Franchise Development Co. My business partner and I owned
a few Chesapeake Bagel Bakery franchises in Denver; one of our restaurants
was across the street from the original Chipotle. We knew Chipotle had
legs, but they weren’t interested in franchising. We joined forces
with Qdoba. It was originally called Zuma, then ZTECA, before they finally
found a name we could own…expensive lesson. We got with Qdoba when
there was only one unit and less than a year under their belt. We coordinated
the legal and administrative processes of setting up the franchise system,
helped with the manuals and systems, and provided a key senior operations
executive to help steer the franchise company. We sold hundreds of franchises
our first few years to large, multi-unit franchisees of other brands.
After about 80 or so restaurants were opened, Jack in the Box purchased
Qdoba for $45 million.
What are some of the challenges
of franchising in today’s economy and marketplace versus expansion,
say, 15–20 years ago? The cost of building and operating
businesses has gone up and continues to go up disproportionate to the
ability to raise menu prices; therefore, it is tougher for undisciplined
operators to succeed. The smarter companies are figuring out how to do
more volume in less space, and companies such as WD Partners are in huge
demand. The fragmentation of marketing has forced more operators to focus
on strong four-walls and neighborhood marketing—strategies that
typically people don’t like to focus on, but, unfortunately, these
strategies are all that emerging brands should be focusing on. Emerging
brands will never be able to compete in a marketing context with concepts
that have been around forever or concepts that advertise during the Super
Bowl.
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