Industry News | September 30, 2013
Pretzels and Italian Ice: Match Made in Heaven?
Most franchisees would jump at the opportunity to boost their revenue with limited additional costs. Jeff Moody and Marty Ferrill are trying to give their franchisees the ability to do just that.
Moody, CEO of Rita’s Italian Ice, and Ferrill, president of Philly Pretzel Factory, announced a new cobranding operation between their brands.
“It gives our franchisees and potentially Philly’s franchisees the ability to go into more places, to have higher volumes, to share personnel and facilities, and to get better economies,” Moody says. “Also, it provides a greater line up for consumers.”
Moody and Ferrill believe a dual-brand store will attract more consumers and generate more revenue than a single-brand store. “Pretzels and what we call ‘water ice’ go really well together. It’s a really nice fit,” Ferrill says. “And the additional revenue for one franchisee is the added benefit.”
Ferrill says franchisees’ finances are used more efficiently when they are able to utilize one space for two different products.
“The economics work better in terms of the build out for the space when you only need one thing now, like one refrigerator, one POS system,” he says.
Start-up costs for cobranded stores will be similar to those of a single-brand store, but franchisees with the two brands will see more returns due to their product variety, Moody says.
He says cobranding success is highly dependent upon operational, marketing, and product compatibility. Rita’s Italian Ice and Philly Pretzel Factory are both Philly-based brands and both share a commitment to high-quality, fresh products, making them ideal candidates for cobranding, Moody says.
“Even though one is baking pretzels and one is making ice and custard, they’re both fairly simple operationally, and they don’t need a very big footprint,” he says.
Ferrill says consumers are quickly recognizing the compatibility of the brands and fully support the decision to cobrand.
“The feedback from customers has been fantastic. A lot of real positive response just because the two concepts fit together so well, especially in this market,” Ferrill says. “Hearing things like, ‘Wow, you guys should have thought of this sooner, this is a great idea.’ It’s a really good, natural fit for these two brands.”
Ferrill hopes the new cobranded concept will one day be accessible throughout the East Coast.
“What we’re hoping is that we can go into some of these high-traffic areas, not just malls. High-traffic areas like bus terminals, train stations, airports, potentially even other nontraditional locations like amusement parks,” Ferrill says. “We’re excited about the opportunity, that’s for sure.”
By Marlee Murphy
Food & Beverage