The Melting Pot is removing the financial burden off potential franchisees with a program that allows them to invest as little as 5 percent into the purchase of a restaurant. Called “Path to Grow,” the program allows the franchisor to provide up to 95 percent of the financing in the form of a loan to the franchise partner to allow them to acquire the location.
“[The program] casts a wider net of potential buyers for an existing franchisee that is looking to sell,” says Dan Stone, chief business and people development officer at The Melting Pot. “There are many great candidates out there who have been operating or managing a Melting Pot or another casual-dining restaurant brand, but they may not have the funds, net worth, or credit score to qualify for financing through traditional means.”
Stone says The Melting Pot closely evaluates a restaurant’s performance in determining whether it will qualify for the Path to Grow program, and locations that may experience some challenges in obtaining financing are given priority.
“If a particular restaurant’s sales have declined year over year—regardless of the reason—this is often a nonstarter for most banks,” he says. “We have the benefit of analyzing why sales have gone down, and are less averse to risk than an underwriter from a lending institution who is not intimately [familiar] with our brand or the location.”
The program gave long-time employee Lucinda Hollis the financial resources to purchase a location in Destin, Florida. Hollis started at The Melting Pot 12 years ago as a server, working her way up to several positions, including general manager and area manager.
“Hopefully, this Path to Grow will keep some talent within our system that we might otherwise lose if they felt there was no place for them to grow or advance beyond the four walls of the unit they work at,” Stone says. “Some of our best franchise owners started out as servers or managers within The Melting Pot.”