Finding The Right Time To Franchise

After five years of testing, Bad Daddy’s Burger Bar began franchising in 2013 to expand into new markets and accelerate growth.
After five years of testing, Bad Daddy’s Burger Bar began franchising in 2013 to expand into new markets and accelerate growth. Bad Daddy’s Burger Bar

Franchising a full-service restaurant concept is the goal and the dream of many successful restaurateurs, but taking the next big step to package a successful concept into a business model that can be replicated by franchisees requires careful consideration, typically after years of hard work to grow a business. No matter where or how one starts, expanding from single to multiple units stems from the right combination of time, investment, and experience.

Replicating the European coffeehouse experience, Atlanta-based Café Intermezzo has more than 1,000 menu items and 800 alcoholic beverages, according to founder and CEO Brian Olson. After establishing Café Intermezzo in 1979, he took eight more years to build a second unit and ultimately license a third unit in the Atlanta airport in 2009.

“Over the years I decided that it was probably too complicated to franchise and thought I would open more locations,” Olson says. “But around 2006, I started studying franchising and was getting the feeling that I would like to see it in other cities and share it with other people. In traveling [around the U.S.], I wasn’t seeing anything quite like Café Intermezzo. I thought it was a great concept to share with people because the primary product is the environment, more than food and beverage, so I think that’s a key cornerstone difference from other franchise concepts.”

A year and a half ago, Olson hired Chicago-based consultants iFranchise Group to help assemble his franchise package and documentation, and to move the plan forward. “One element that makes it quantifiably a bit more challenging than a typical foodservice franchise is that it’s a $2.1 million to $2.4 million investment to open turnkey,” Olson says. “That’s more than a lot of people are looking to invest in an operation, but it’s justified—at least in our operations—by the revenues.”

His franchise consultants urged him to initially franchise at least one or two units fairly close to home, so the first real estate targets for franchised units will be Nashville, Tennessee; Charlotte, North Carolina; or Charleston, South Carolina.

Brand Building

Founded in 2007, Bad Daddy’s Burger Bar has seven units in North and South Carolina and Colorado, three of which are licensed, and one, in Greenville, South Carolina, that was franchised in November 2013. Boyd Hoback, president and CEO, and Bill McClintock, vice president of franchise development, jointly own the franchise company with Bad Daddy’s co-founders Frank Scibelli and Dennis Thompson.

“We got involved with Bad Daddy’s both to build stores for our own account as a licensee and to help franchise the brand,” Hoback says. “Part of that decision was to get other very qualified multi-unit operators involved in the brand as well as to develop markets that we may not be familiar with. For us, the advantage of franchising is to be able to franchise to guys that know their own market well, know their own real estate, and have an infrastructure in place. [It’s also beneficial to leverage] their operating expertise and access to capital.”


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