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June 2007
Volume 9, Issue 5, Part 1

Publisher: Mary E. Tomzack
Editor: Lynie Arden
Assistant Editor: Vanessa Goldschneider
Design: Halit Rugova


June:
Summertime

Video Clip

In case you didnt see it -- Click Here for Hillary's take on the Soprano's last episode.

In this issue...

Street Smarts:

The Multi-unit Movement benefits franchisors and franchisees .
Industry Focus:

Meal Assembly- The next big thing in food franchises.
Guest Column:

Attraction In Action.


The Multi-unit Movement benefits Franchisors and Franchisees

Right now, more than one out of ten franchisees operate more than one unit. Many of them operate more than one concept. There is growing evidence of a trend toward multi-unit and multi-brand ownership. The advantages to both franchisors and franchisees are clearly compelling, and dramatic growth in multi-unit and multi-concept franchising is expected over the coming years.

The primary benefit for franchise companies is the opportunity for fast, efficient growth. Area developers who can develop an entire geographical area are ideal because they have strong organizations of their own, which the franchisor can leverage. It takes a much smaller investment in time and money to develop a region or even an entire state when you're dealing with one individual instead of 50. Franchisors who don't have to spend time on the nitty gritty business of opening stores can focus on extending brand awareness - which again, can grow much more rapidly.

The benefits are there for franchisees, too. It's becoming increasingly difficult to make a living from a single unit or even a couple of units. Owners with multiple units and/or brands have the added advantage of being able to spread the risk. Times may be slow for one, but rarely for all - at least not at the same time. Multi-unit operators also report that attaining success gets easier as the number of units grows. Costs per store unit drops, which means more money is available for better managers and better marketing.

Industry Focus

Meal Assembly - The Next Big Thing in Food Franchises

We Americans are a busy bunch. On average, we can only manage to find time for a home cooked meal two or three times a week. Fifty years ago, the solution was frozen dinners. Then fast food franchises took over. Today, there is a new alternative for time-starved people who crave wholesome meals at home. It's the hot new concept known as meal assembly.

The first meal assembly franchise was the brainchild of Stephanie Allen, founder and CEO of Dream Dinners. "Customers come into our stores once a month and make their own dinners," Allen explains. "They choose 12 recipes, make a reservation for a time they'd like to come in, and we have all their ingredients ready and prepped for them. As they assemble their meals, we seal and label them with cooking instructions. In less than two hours they make 12 full size family dinners that they can take home, freeze, and cook whenever they want. These are dinners they've made themselves so they feel good about serving them. The meals are healthy and they know what's in them."


Company: Dream Dinners
Units: 220 open, 60 in Development
Startup costs: $250k to $370k
Franchise fee: $35K
Address/phone: P.O Box 889, Snohomish, WA 98291-0899
Phone: (425)293-9871
Website: www.dreamdinners.com
In business:
2002
Franchising since: 2003

The Dream Dinners concept saves customers both time and money, according to Allen. "Compared to going to the grocery store for ingredients, it is cheaper by $200-$300. And that's if you're going to cook. But our research shows that the 3 nights a week people are using Dream Dinners, they were typically eating out - which is a lot more expensive. As for time savings, there is no cleanup at home and no prepping, shopping, deciding, or thinking. We've calculated that making your monthly dinners in 2 hours this way, you save about 18 hours. That's like giving somebody a whole extra weekend!"

The Dream Dinners concept evolved out of personal experience. "I'd been making my dinners this way for 7 years before creating the business. I had a girlfriend who was a teacher with 3 kids and no time to cook. I had a successful catering business yet I couldn't get dinner on the table either. One day I invited her to come to my house to put some dinners together and freeze them. It worked so great, we just kept doing it - once a month for 7 years. Over those 7 years our reputation in our little town grew. People kept saying, 'I want to do that, I want to cook the way you do.' Finally, I sent an email off to my friends saying, 'you've been asking me for years, so come on over. I'll open up my catering kitchen one night a month'. That's how it all began. Six years later, we've created a whole new industry."

Download FranchiseHelp's FREE White Paper on Meal Preparation franchises


Attraction In Action
By: David Handler

Part 2 (Continued from last newsletter)

Buddha is quoted as saying, “With our thoughts, we make our world.” Similar examples from each of the major religions connect clear intention with anticipated results: Mark 11:24 in Christianity; The Mahavakyas in Hindu; The Kabbalah in Judaism. Each suggests a higher power – God, deities, the Universe – delivers what we desire into our lives. This is the spiritual side of The Law Of Attraction (LOA).

So how do you benefit from knowing this secret?

As a franchisor, gather your leadership team and define your perfect franchisee. LOA suggests that once you become crystal clear on who this is, you will naturally focus on attracting these people to your brand. Everything – from your strategic plan, to your marketing, to your Discovery Day – will be in alignment with your desire. Do this, and see if your next five franchisees are closer to your intention than the last five.

As a franchisee – or potential franchisee – have you clarified the one thing you seek from your business? Most people quickly describe what they don’t want…answering to a boss, dealing with corporate frustrations, working for the man, etc…however, few people are able to clearly state their intention. Take time over the next two weeks to see how focused you can become on the one thing you desire. You’ll struggle to narrow it down to a single sentence; yet, once you truly identify it, you’ll discover many things begin appearing to bring it closer to reality.

OK. So you read both these articles, and you’re as skeptical about LOA as I was a year-and-a-half ago. That’s understandable, and here’s your chance to test it…to prove me wrong.

Spend 45 minutes this weekend looking at some magazines. Whenever a picture resonates with you, cut it out. After you’ve collected a dozen or so, pick five that represent the life you desire. Mount them in a visible place in your office, and each morning just look at them for one minute. See what happens over the next 90 days. If LOA is a hoax, all you’ll waste is a couple of hours of your time. On the other hand, if LOA is, indeed, the world’s greatest secret, your life will change forever. Are you willing to take the risk?

“What power this is I cannot say. All that I know is that it exists.” – Alexander Graham Bell

David Handler is the founder of Success Handler, LLC, and previously served as a senior executive at ICED. He leads franchisors and franchisees to explore their professional and personal dreams. To unleash attraction in your life, send an e-mail to coach@successhandler.com or visit www.successhandler.com

Sweet Summer Drink Sales

With summer heating up, quick-service restaurants including Dunkin' Donuts, Jamba Juice and Atlanta Bread, are enhancing their sweet beverage and shake offerings to capture thirsty customers. Several brands have recently announced limited time offers. Executives hope these offerings will increase drink sales anywhere from 5 percent to 15 percent.

Sonic Drive-In launched an Oreo and Hot Fudge Shake in April and followed that up with the roll out of the Full Throttle Slush which is loaded with ginseng, B-Vitamin complexes and taurine. At the same time, Arby's brought back its popular Orange Cream Shake through July 7. Wendy's recently introduced the Frosty Float, available in chocolate or vanilla. Additionally, many brands are jumping into the popular smoothie market. In 2006, smoothie makers earned more than $2 billion from made-to-order and packaged smoothies, up more than 80 percent in the last five years. (qsrmagazine.com, 5/21/07)

Chili's Grill & Bar to expand in Midwest

Brinker International, Inc., announced a new franchise and development agreement with franchisee ERJ Dining of Louisville, KY. Under terms of the new agreement, ERJ Dining will acquire 76 existing Chili's Grill & Bar restaurants and develop 49 new locations in the Midwest. Including the ERJ Dining agreement, during the current fiscal year, Brinker domestic and international franchisees have signed agreements to purchase 182 company-owned restaurants and develop 165 -189 new locations over the next 10 years.

Upon completion of these transactions, franchise ownership of Brinker brands will surpass the company's initial goal to increase franchise ownership to 30 percent by the end of the calendar year 2007. As recently announced, Brinker anticipates franchise ownership will further grow to 35 percent by end of fiscal year 2008. ERJ Dining currently operates 25 Chili's restaurants in Kentucky, Indiana, Illinois, Wisconsin and Missouri with four additional restaurants in development. Once terms of the expanded agreement are met, ERJ Dining will become one of the largest Chili's franchisees in the country. (qsrmagazine.com, 6/1/07)

Marriott to develop New Boutique Chain


Lodging giant Marriott International Inc., one of the hotel industry's most conservative companies, has struck a deal to develop a boutique chain designed by Ian Schrager, the entrepreneur known for his style-driven hotels. The agreement is intended to give Marriott a presence in the boutique segment of the hotel industry which it has been unable to crack even as rivals like Starwood Hotels & Resorts Worldwide Inc., have found success with brands such as W.

For Mr. Schrager, the hotelier who was behind hip properties like Morgans Hotel in Manhattan, the deal provides a new platform for his hotel design. In the new partnership, Mr. Schrager will focus on designing, marketing and branding the hotels. Marriott will operate them under long-term management contracts. As is now standard in the industry, the hotels will be owned by third parties who will pay fees to both Mr. Schrager and Marriott. The new brand, which hasn't yet been named, will be added to a group that includes Marriott's flagship hotels, its luxury Ritz-Carlton brand, and the mid-scale Renaissance Inn and Courtyard by Marriott brands. (Wall Street Journal, 6/14/07)

Donut Chains Find Success in Asia

Some of the world's top donut chains have come rolling into China, Taiwan, South Korea and Japan and elsewhere in the region as Asians embrace the Western fast food fad. Chains like Krispy Kreme, Dunkin' Donuts and Mister Donut are setting up shop in a region not known for its sweet tooth, reflecting a growing openness to foreign foods and rising living standards, according to the chains and consumers. In a twist on the common snack in the West, the chains say they are filling a growing demand for high-end treats that can double as gifts as well as snacks.

In their Asia expansions, the donut makers admit to tweaking their recipes, much the way fast food chains like McDonald's and Yum Brands' KFC and Pizza Hut have added new products and emphasized foods to suit local tastes. Dunkin' Donuts Taiwan menu includes such foreign flavors as green tea and honeydew melon donuts, while Mister Donut also offers green tea and flavors like strawberry and sesame. One of the biggest differences is in sweetness, with many donut makers toning down their sugar content in a nod to Asians' generally lower preference for sweet foods. (nytimes.com, 6/14/07)

7-Eleven Going the Franchise Route

7-Eleven Inc. is planning to convert its company-operated stores in the Washington area to franchises as part of a national strategy to become a fully franchised business. The Dallas-based convenience-store chain has 951 stores in D.C., Maryland and Virginia with 413 of them currently franchises. Over the next five years, 7-Eleven expects to convert the remaining 528 company-operated stores to franchises. About 3,650 of the company's 5,600 stores in the United States are franchises. 7-Eleven, a privately held company founded in 1927, has more than 31,600 stores worldwide. (Washington Business Journal, 5/29/07)

Hilton Quickens its Global Growth

Hilton Hotels Corp. confirmed this month that it had reached agreements to develop about 55 hotel properties in Russia, Britain and Central America with a group of partners. The company has agreements in place to form alliances for development in those three markets which is expected to result in around 55 hotels total. The move is part of an effort to extend Hilton's international presence through management contracts and franchises with established real estate development firms, allowing Hilton to remain "asset light." Hilton intends to develop 1,000 new hotels outside the U.S. in the next 10 years. In 2006, Hilton paid $5.7 billion to buy Hilton Group in Britain and forged alliances to build 100 properties in India and China. The latest alliances are another step in their fast-paced international growth plan. (latimes.com, 6/4/2007)








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