Moe’s Southwest Grill

From the pages of Restaurant Franchising
The Atlanta-based fast-casual concept continues optimistic growth

Moe’s Southwest Grill franchise

“Welcome to Moe’s!” The fact that people can’t even think of Moe’s Southwest Grill without recalling its notorious greeting is a tribute to the Atlanta-based company best known for fresh southwest fare, quirky menu names, and a fun, family-friendly environment. The company has carved itself a profile in the fast-casual market, as it continues to thrive in its 10th year; “While the segment is growing in popularity because of speed, convenience, and value, Moe’s is particularly well positioned because of the differentiated brand experience, high-quality ingredients, and excellent service,” says Steven Corp, vice president of franchise sales.

Moe’s looks for franchise partners who understand the restaurant business already, then they look to see that experience backed up by operations, management, and profit and loss experience.

Moe’s franchise partners should have $1 million in net worth and $200,000 in liquid assets. “One of the biggest reasons people don’t succeed is that they are undercapitalized,” says Corp. “So they need restaurant experience and they need the proper financing.” (Like other companies, Moe’s has raised its requirements over the past 18 months as loans have been more difficult to come by.) Corp estimates that it takes about $450,000 to $500,000 on average to open a restaurant.

Typical operators have three to 10 restaurants, says Corp, and the company likes that. “Historically, it’s advantageous for Moe’s operators to have more than one location because they’re able to find marketing efficiencies, build a strong employee infrastructure, and gain useful brand knowledge by living the business at more than one restaurant.”

Moe’s franchise partners get support from corporate on several levels. “From site selection and build-out, to ongoing marketing and training support, the Moe’s team offers a wide array of expertise, systems, and tools, most of which can be found on our company intranet,” says Corp. “Additionally, we have four corporate locations where we can train, test new products, try local store marketing tactics, and perfect operations, which enables us to continually improve our systems.”

Moe’s has an active franchise advisory council, whose members are voted in by fellow franchise partners. “We don’t do anything unilaterally at corporate. We build a relationship with our partners, sharing information on as many fronts as possible,” says Corp, and even though parent company FOCUS owns several brands, each brand has its own dedicated team: president, marketing, sales, research and development, and so on.

Franchise partners also get support from franchise business consultants, who visit the stores and provide feedback. “The quality of these people is so high,” says Corp. “The franchisees really feel like partners in solving problems. The goal is to share best practices and improve the unit level economics of every store.”

Over the past difficult year, says Corp, same-store sales remained “close to flat, and in this economic climate, that is fine. Over the last quarter, sales have been consistently trending positive, which brings us great optimism about 2010.”

Future Moe’s growth, about 50 stores in 2010, will be in two arenas—traditional domestic restaurants and “non-traditional” locations such as airports and universities. The company already has 14 non-traditional locations with more under development. Moe’s is focusing its efforts on existing markets, particularly those in the northeast: New York; Boston; Washington, DC; and Philadelphia. (International growth is not included in this number.)

Moe’s corporate recently worked closely with a franchise partner in Vermont to develop a LEED (Leadership in Energy and Environmental Design) certified building. “Moe’s has a long-term goal to become a more sustainable business, and this LEED (pending) location is the first step in the right direction,” says Corp.

For more information about franchising opportunities with Moe's Southwest Grill, visit www.moes.com/Franchising.php.