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  • 11 Restaurant Franchises on the Cusp of Greatness

    Emerging Concepts April 5, 2018 By Danny Klein
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    The Hummus Pita & Co.

    Fueled for growth

    We’re all looking for the next big thing. In the restaurant industry, concepts arrive daily and look the part. But getting there is another story. Tales like Firehouse Subs, which sped to 1,000-plus units from its Jacksonville, Florida, roots, to Five Guys and other massive operations that begun from humble bases, are tough to come by. And, frankly, that kind of four-digital rollercoaster isn’t for everybody. In this growth conversation, franchising remains a powerful tool for brands of all sizes and backgrounds to scale up. It might not be for every concept, but there’s no denying its value for many operators hoping to bring their brand to new audiences worldwide and in the U.S.

    Here’s a look at 11 franchised concepts ready for lift-off. Click the arrows in the picture above to begin the story.

    A bowl of food at CoreLife Eatery.
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    CoreLife Eatery

    CoreLife Eatery

    CoreLife began as a shop in Syracuse, New York, in May 2015. Many concepts tout the healthy lifestyle but how many host yoga and Pilates classes? The fast casual, which serves foods free of trans fats, artificial colors, sweeteners, other artificial additives and GMOs, and focuses on hearty bowls, has major plans ahead. With CEO Larry Wilson at the helm, the brand plans to expand to 300 locations, including corporate and franchised units, nationwide over the next five years.

    In late March, CoreLife announced a new development agreement to enter North Carolina. Earlier in the month, it signed a 21-store deal for the Cleveland area. Just weeks before, a 32-unit agreement for Florida. And before that: Pennsylvania. CoreLife is targeting more than 60 units by the end of this year, with 40 opening in just 2017. So the growth will be rapid and sustained. Steven Corp, a seasoned franchise sales professional, joined as senior vice president of franchise development in August 2017 to head up expansion. He spent 15 years with FOCUS Brands, where he helped scale Moe’s Southwest Grill, Schlotzky’s, Auntie Anne’s, and Cinnabon.

    A salad bar filled with choices at Coolgreens.
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    Coolgreens

    Coolgreens

    CEO Robert Lee knew a great concept when he saw one. After dining at the Oklahoma City-based salad chain’s first location, Lee approached its founder with interest in becoming a franchisee. That was nearly a decade ago. Coolgreens wasn’t franchising yet but that didn’t deter Lee. He invested in the brand and eventually joined its management team. In early 2017, everything changed when Coolgreens brought on Clay Carson, its vice president of franchise development, and began to plot a course for growth.

    There are currently eight units and two franchised, pushing average-unit volumes of $803,000 in a 2,000 or so square-foot concept that does a lunch/dinner split of 60/40 and carries an average ticket of $12.50–$12.74. In its first eight years, Coolgreens grew from one to seven traditional locations, plus an airport unit. By the end of 2018, Coolgreens expects to open at least four to six additional units in Oklahoma and Texas, with a plan for 40 open units and another 50 in the pipeline. Coolgreens set a franchising minimum of three units per agreement and is approving only applications with prior experience. World Franchise Associates announced in early April that it signed an agreement to exclusively represent Coolgreens for development opportunities in the Middle East.

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    Melt Shop

    Melt Shop

    In late 2017, Melt Shop announced its franchise program. To that point, Melt Shop had grown to eight units in New York, Philadelphia, and Minnesota since arriving on the scene in 2011. Founder and CEO Spencer Rubin enjoyed franchise success right out the gate. Melt Shop signed agreements to develop 26 locations worldwide in markets like Pennsylvania, New Jersey, Delaware, and the Middle East. The first international franchise unit debuted January 2018 in Kuwait City as part of a seven-restaurant deal in the Middle East.

    The broad goal is to hit 100 locations in the next five years, leaning on its simple, yet proven model of melted sandwiches, made to order, built with high-quality ingredients. The company said its targeting domestic opportunities in the Northeast, Midwest, and Florida, and internationally in Southeast Asia, Japan, China, India, Mexico, South America, Canada, Western Europe, and Australia to go along with the Middle East growth. The chain said the ROI is robust as well, with estimated initial investment range of $368,240–$698,800 for the first location, including a franchise fee of $35,000 and a sales range of $1,016,984–$1,640,406.

    “We think the sky’s the limit. We think Melt Shop could be a 500-plus unit concept in the next 10 years based upon the success we’ve seen in different markets already,” Rubin told QSR in October.

    Turkish Meatballs in a pita.
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    The Hummus & Pita & Co.

    The Hummus & Pita Co.

    There’s no denying the strength of Mediterranean in fast casual. But what about Americanized Mediterranean? Introducing a three-unit concept out of New York City hoping to sell 100 locations this year alone.

    “We wanted the only ethnic part of our brand to be the authenticity of the flavors of our recipes. But we wanted our look and feel to be American, accessible and warm,” co-founder Dave Pesso said in February.

    The chain is currently building units in Denver; Brookfield, Connecticut; and Holmdel, New Jersey. Each part of a five-unit deal with a group in the area, bringing the imminent footprint to 15. And recently, it signed a five-location franchise deal in Michigan, with plans to open in Troy, Warren, Canton, Detroit, and Ann Arbor. Florida is up next, according to the brand, as well as Tennessee, Texas, and California. Culinary wise, The Hummus & Pita Co. doesn’t box itself into any singular region.

    “We wanted to have the best of what our family is, because our family’s background is Greek-, Turkish-, Israeli-American; we’re a mixture of what America is,” Pesso says. “If you come into our place, you’ll see a gyro, which is Greek, next to a shawarma, which is Middle Eastern-Israeli-Palestinian. We have Turkish Salad, Moroccan Beans, Spanish Eggplant, Moroccan carrots, Turkish Meatballs … a mixture of everything. When someone comes to us, they’re not coming for Greek food or Israeli food, they're coming for healthy, delicious, craveable food,” Pesso said.

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    Überrito

    Überrito

    In February, the fast casual Mexican chain announced it signed a Master Franchise Agreement that carries the potential of more than 100 franchise locations—just in Texas. Ally Lakhpaty and SNL Franchise Development plan to expand across Houston, Austin, and San Antonio. The Lakhpaty family has more than 30 years of development experience with Subway and Sub Zero. This would be a massive boost from its current footprint of five Houston-area units and two Phoenix locations. The chain is part of Mexican Restaurants Inc., which operates 43 total units across five brands: Überrito, Casa Ole, Monterey’s Little Mexico, Tortuga Mexican Kitchen and Crazy Jose’s.

    Überrito launched its nationwide franchising program in June 2017 with the arrival of new chief development officer Peter Ortiz. Single and multi-unit area development opportunities, along with master franchise agreements, are available. The company is looking for operators with a minimum net worth of $1.5 million and at least $500,000 in liquid assets, and to agree to a 10-year initial term of contract, as well as front the franchise fee of $40,000 per location. The Überrito concept launched December 2014, building on the success of the former Mission Burrito founded in 1996 in Houston.

    Polpettina Antipasti: this  appetizer features two of Mici’s popular hand-rolled meatballs topped with matriarch Rosalie's marinara, and garlic bread
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    Mici Handcrafted Italian

    Mici Handcrafted Italian

    The Denver-based fast-casual Italian concept, founded by siblings Jeff, Michael, and Kim Miceli, is slated to begin franchising toward the end of 2018. It expects to open one or two corporate stores annually while building a pipeline for franchisees and strengthening systems. In 10 years, CEO Elliot Schiffer said the goal is 100 Mici restaurants in operation. For now, corporate growth will remain in Colorado, with a potential aim of 15 Denver-area stores.

    “We want great operators who care about the brand,” Schiffer said in January. “We’ll choose the person over location, because there’s nothing that requires anything unique from a demographic perspective.”

    Schiffer joined the brand as partner and CEO last August. He was previously senior vice president of non-traditional development for Smashburger. The chain presents an old-school vibe to go with new-school convenience. Online ordering is a key component, for example, and about 60 percent of Mici take-out and delivery orders are placed online via an ordering app. “I found it interesting that with four units, a lot has been done with branding and technology,” Schiffer says. “Mici is not operated like a mom-and-pop place.”

    Pizza accounts for 40 percent of sales and units so far vary greatly in square footage, showing its versatility. The first, in Downtown Denver, is 1,200 square feet; the second in Cherry Creek Shopping Center is 2,300; and the third and fourth are 1,500 and 1,800, respectively, with seating for about 55 guests.

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    Pokéworks

    Pokéworks

    The 20-unit chain hit stardom with a poke burrito that went viral. But there’s nothing flash-in-the-pan about this brand, founded in 2016 in Midtown Manhattan by brothers Michael Wu and Peter Yang, and college buddies Kevin Hsu and Kasper Hsu. The chain said in mid-March that it expects 100 new franchise locations in the next two years. There are thriving stores currently in Manhattan, Houston, and Chicago. Multi-unit deals are signed for San Francisco, Phoenix, Miami, Philadelphia, and Atlanta. Major cities will be the target.

    “Our commitment to providing a healthier alternative to traditional fast food, coupled with the ability to meet demands for a reduced carbon footprint and naturally sustainable food, places us in a prime position for future growth,” Hsu said. Pokéworks has invested in infrastructure with a comprehensive franchisee training program and dedicated support teams to assist with on-boarding, developing, and ongoing operations.

    The chain said it is seeking experienced operators in Texas, Florida, and California, but isn’t restricted to those areas. The menu is simple and easy to execute and the kitchen design allows for lower construction costs, reduced labor, and lower ongoing maintenance than some other concepts. The initial franchise fee for Pokéworks is $35,000 for a single unit with discounts for multi-unit agreements.

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    Teriyaki Madness

    Teriyaki Madness

    Denver-based Teriyaki Madness calls itself “the fastest growing Asian restaurant concept in the nation,” and landed on Entrepreneur Magazine’s Franchise 500 for the second year in a row this past year. The company credits this to average unit volumes of $1,096,047 and profits up to 26 percent. In mid-February, the company unveiled expansion plans for Los Angeles that call for 20–25 additional units through franchise partnerships and strategic development over the next five years.

    The 41-unit company also has a similar deal in place for Miami. Brooks Speirs, formerly of Moe’s Southwest Grill, is directing expansion as vice president of development. Teriyaki Madness said it expects to open more than 100 units in the next two years, and the company is a believer in transparency, and includes an Item 19, which shows every Profit & Loss statement for each of the Teriyaki shops open two-plus years. Teriyaki Madness was founded in 2003 and currently has franchise agreements for nearly 150 locations in the U.S. It landed on the top half of the Inc. 5000 list in 2017 with three-year sales growth of 171 percent.

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    Rascal House

    Rascal House

    Clevelanders are plenty familiar with Rascal House, a concept that has been a local staple for nearly 40 years. In mid-March, the company revealed that it was launching a franchise expansion plan to build out the Ohio market and beyond. Company president Niko Frangos has started accepting applications for Cleveland, Columbus, Akron, Toledo, and Cincinnati. The brand is also registered and approved to sell franchises in Indiana, Michigan, Pennsylvania, and West Virginia. Frangos said he believes Rascal House, which specializes in pizza, burgers, fries, subs, salads, and wings, could open three to four stores this year and as many as 15 in the next 24 mounts.

    “We’re proud of our history, our reputation, and the fact that we’re still a Cleveland hometown favorite. Now we’re taking the Rascal House experience to more neighborhoods,” Frangos said. The brand was founded in 1980 by Frangos’ parents and has served more than 2.1 million pizzas.

    The franchise fee is $30,000, and the initial investment to open a Rascal House franchise ranges from $386,700–$694,700. The average restaurant is 2,500 square feet and employs roughly 40 full- and part-time people. The average unit volume nationwide, per restaurant, exceeds $1.3 million.

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    Jenna Satariano

    Mamoun’s Falafel

    A NYC icon since 1971, Mamoun’s Falafel has five corporate stores in New York, New Jersey, and Connecticut, as well as two franchised units in New Bruswick, New Jersey, and Dallas. With Fransmart leading the charge, the chain has three additional units planned for spring openings in Philadelphia, Long Island, and Fort Lee, New Jersey. Additional stores are in the pipeline and projected to open by year’s end in major markets, including Northern California, Chicago, and Staten Island, New York. Mamoun Chater founded the business using traditional Syrian recipes, which are still featured today. It’s currently run by Chater’s four sons.

    “The franchisees we have partnered with thus far are passionate about the brand and excited to join the Mamoun’s family. Their enthusiasm, paired with the resources and systems we’ve developed, have led to Mamoun’s success in each new market, and we look forward to repeating this pattern as we continue to grow,” Hussam Chater, the company’s CEO said.

    Mamoun’s Falafel was also included in the travel book “1,000 Places to See Before You Die” and has been featured on the Food Network, Travel Guide Channel, and on nationally syndicated television shows like The Rachael Ray Show and The Chew.

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    Maui Tacos

    Maui Tacos

    Mark Ellman created the iconic Hawaiian fast casual in 1993 for surfers and celebrities. It has since grown to eight locations on Maui and Oahu. In early April, the brand announced that it is ready to turn its growth national, with six new store openings scheduled for 2018 and 12 stores slated for 2019. These will be in in Kahului, Hawaii; Monroe, Louisiana; Pearl City, Hawaii; Charleston, South Carolina; Reno, Nevada; and Las Vegas, Nevada. The 10 new stores in 2019 will include a Hilo, Hawaii, location as well.

    “Mexican fast casual is and has been one of the fastest-growing food segments nationwide and offers great opportunities for franchisees who want to enter into this arena with an established brand known worldwide having served guests in Hawaii for 25 years,” Maui Tacos CEO Jeff Endervelt said. “We treat our franchisees like our ohana, our family,” Endervelt added. “We offer comprehensive training and ongoing support when franchisees open and operate a Maui Tacos. Thekokua [help[ doesn’t stop there. Maui Tacos corporate provides ongoing marketing and operational support and constant menu development. It’s all a recipe that’s been 25 years in the making, resulting in internationally acclaimed and award-winning cuisine, a proven business model, and a fun lifestyle for the franchisees and stakeholders involved.”

    Endervelt has led the brand since 2004. He was the CEO, president, and board chairman of Blimpie International Inc. from 2002–2005. The chain is targeting Hawaiian spots in Oahu and Big Island, as well as mainland locations in Oregon, Washington, Arizona, California, Florida, Colorado, Georgia, South and North Carolina, and Tennessee.