California-based gourmet hot dog, sausage, and burger concept Dog Haus will open 300 locations over the next seven years following a deal valued at more than $500 million with American Development Partners.
The development agreement will put Dog Haus in more than a dozen new states, and the new locations are slated to be constructed on land primarily purchased for built to suit and stand-alone concepts.
Dog Haus partner Quasim Riaz says the deal was perfect timing as there are many smaller agreements out in the pipeline for franchisees establishing locations in Ohio, Maryland, Texas, and Colorado.
“With this deal coming on and other operators coming in and developing, it’s better for the brand and for the individual stores all together because you get more of a critical mass and more people know about the brand,” Riaz says. “It’s easier than being out there by yourself and operating two stores in a state, when neighboring states or neighboring cities within those states have other Dog Hauses as well.”
Dog Haus has 21 stores open in five states including California, Arizona, Colorado, Nevada, and Utah, and for expansion the brand will look to franchisees with multi-unit and multi-brand experience.
“The 19 states were selected because of the quality of the operator,” Riaz says. “At the end of the day, our brand is only as successful as the operators, and the ones that we found were awesome operators and we felt comfortable with them expanding and taking our brand and making it something that’s hopefully becoming a household name.”
Riaz, along with Hagop Giragossian and André Vener, founded the concept six years ago, and the partners decided to franchise Dog Haus in 2013.
Riaz says there has been a void in the market for gourmet hot dog and sausage concepts, clearing the way for Dog Haus’ growth.
“We sit alone in the gourmet hot dog and sausage fast-casual segment,” he says. “There’s nobody doing what we do. If we were to talk about the better burger segment, for example, I could name off 15 burger concepts. I could do the same thing with pizza concepts, but nobody’s taking that same approach to a better hot dog or sausage. There was an opportunity.”
As the brand expands, the partners say it will maintain the quality of its culinary items, including soft-serve ice cream, all-beef hot dogs, sausages, burgers, and toppings served on grilled Hawaiian rolls, and will also place an emphasis on curating craft beer menus to the local communities.
“People in Texas, they want their Shiner Bock; the people out in Wisconsin will want their Leinenkugel, so we’re huge fans of our local craft beers and all of our stores will definitely have local beers on tap,” Riaz says.
With the deal, the total number of Dog Haus locations across the country—including previous franchises sold—will total more than 450, and 10 of the 19 states are sold out.
“In addition to their vision, leadership and integrity, Dog Haus is an industry leader in food quality and has a proven track record of producing above average sales,” says Caleb McMillen, COO of American Development Partners, in a statement. “Combined with their exceptional marketing appeal, we’re looking forward to working with many experienced franchisees to help expand the brand into 12 states across the country and filling a void in a restaurant sector that we feel has an incredible upside.”
By Alex Dixon