Area Developer's multi-unit conference provides a portfolio of opportunities
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Area Developer's multi-unit conference provides a portfolio of opportunities

Building a portfolio. Growing beyond one unit. Expanding outside a single brand.

How to do all this and more was on the minds of several hundred multi-unit franchise operators at the recent Area Developer Multi-Unit Franchising Conference & Expo. This year's event, with the theme "Growth By Design: Planning for Multi-Unit Franchising Greatness," was held at the foot of Pike's Peak and the Rocky Mountains at the Broadmoor resort in Colorado Springs.

The annual conference - the only one in the nation focused exclusively on multi-unit franchising - attracted area developers and owners of multiple units seeking advice, tips, education (often from each other) to give them an edge in their marketplace. This year's meeting took place April 18-20 and attracted more than 400 franchise industry executives. Two-and-a-half days of roundtables, general sessions, networking, and Q&A's with panelists provided myriad learning opportunities.

The event kicked off on a Wednesday morning with in-depth workshops where industry experts and professionals delved into topics related to multi-unit growth, the fundamentals of development, and effective leadership.

Franchise attorney Lane Fisher, of Fisher & Zucker, moderated a discussion and panel with four successful multi-unit operators who discussed numerous operational and management issues and then took audience questions.

Asked by an attendee what the keys to success were for multi-unit operators, Gary Robins, a Supercuts multi-unit franchisee said, "You must have great managers at the unit level; it all boils down to that."

John Metz, a multi-unit operator with Denny's, Bennigan's, and Marriott agreed, adding, "Your manager is the key figure in your overall success, regardless of whether you have a more centralized management approach or a decentralized approach."

Thom Winninger led another in-depth session focusing on growth strategies for multi-unit operators. He noted how managers often spend most of their time dealing with their problem employees. The resulting cost is significant in more ways than may be obvious, because top employees often will leave a system because of lack of attention and interaction. Focusing on the problems is one sure way to stunt growth, said Winninger.

Krispy Kreme operator Rick Reinis, a panelist at this session, offered his take on keeping his units in peak operating condition. "Run your business like you're going to sell in four to five years," he said. "Keep things in order."

Common dreams, common themes

One common theme throughout the week was how multi-unit operators need to create cultures conducive to consistent performance and growth. One way is to stay involved in the day-to-day nuts and bolts. "Do as much of the back office work as you possibly can," said Reinis. "Don't be afraid to get in the trenches."

Rick Guerra, who operates Tony Roma's, two Marriott brands (Courtyard, Fairfield Inn), and Embassy Suites (Hilton), said, "Your culture is your employees and your guests and you must take care of them." And, in reference to employees, he added, "Bad people can ruin a great franchise."

The Exhibit Hall was officially opened Wednesday evening, with a tasty reception for attendees. The sold-out hall featured 80 booths of exhibitors, and opened aisles and avenues of dialoguing, dealing, and networking opportunities for franchisees and franchisors alike.

Thursday opened early with a packed general session and a busy morning. FRANdata's president, Darrell Johnson, gave a brief state-of-the-industry summary, packed with data, beginning with a review of the current economic climate. "Housing is hanging on, core inflation is flat, and '06 corporate earnings featured the 14th consecutive year of double-digit growth," he reported.

However, he cautioned, consumer spending is easing while the overall job market continues to tighten. Johnson advised attendees to be aware of ethnic population shifts and the aging of the U.S. "These are becoming important areas of understanding for the franchise industry," he said.

He also acknowledged that franchising remains strong, with more than 2,600 active systems and many new concepts continuing to appear. Johnson reported that 51 percent of all franchises today are operated by single-unit owners, while 24 percent have between two and five units, and the remaining 25 percent operate 6 or more units.

Next up was keynote speaker Robert Kriegel, a New York Times best-selling author and NPR commentator. His energetic presentation style (Kriegel is a former all-America athlete and pioneer in the field of sports psychology) engaged the audience as he held forth on the changing retail marketplace and warned the franchise industry not to suffer the same consequences as Greyhound, Western Union, and the Sears catalog: refusing to adjust to changing consumer demands.

"You don't sell products, you sell solutions," he said. "You can't play today's games with yesterday's rules." Successful companies, he continued, don't respond to change, they create it. "Don't just think out of the box, get out of the box," he said - by observing other successful business practices and adopting those into your own culture.

Bill Fromm, co-founder of Service Management Group, next presented some of his organization's findings related to customer loyalty, in a presentation entitled "Five Things We Learned from Talking to 100 Million People." "Satisfied customers are not loyal," he said. Inconsistency, he explained, is the enemy of loyalty. Fromm also noted that companies with "great problem resolution policies create apostles."

Steve Olson, publisher of Franchise Update Media Group, then hosted a general session panel called "Building Your Power Portfolio" with five experienced multi-unit and multi-brand franchises. Discussion topics ranged from territories and locations to earnings claims and franchise support.

Breaking out

Break-out sessions filled the afternoon with topics including "Buying and Selling Franchise Units," "Brand Management," and "Driving Sales Growth Through Customer Loyalty."

The session on driving sales growth featured Dave Feamster, a Little Caesars multi-unit operator (and former Chicago Blackhawks pro hockey player), and Bill Welter, a Buffalo Wild Wings multi-unit operator. The two shared their experience and strategies related to marketing and customer loyalty, each jotting down ideas while the other spoke.

"I want a one-mile ring around my stores where, for those people, I am ‘their' store," said Feamster. "It's a mom-and-pop feel where we all know each other by first name."

Welter said customer relations is so important to him that during company meetings he has employees role-play ways to develop and improve relationships with customers.

After a full day of sessions and between-session networking, the Exhibit Hall re-opened with a reception and a silent auction for charity, with proceeds going to The Little Rock Foundation, which helps children with visual impairment and blindness live the fullest lives they can.

Day three

Friday morning closed out the event with a session led by employee and recruiting expert Mel Kleiman, president of Humetrics. He quizzed his panelists on a number of recruiting and retaining practices. Two key elements emerged from the discussion: 1) successful franchises create fun environments, and 2) they recognize performance.

Gloria Plaisted, a Dairy Queen multi-unit operator and franchise consultant, said, "Kids today want to have fun on the job, so we've really asked them how they define fun, and we try to create that atmosphere." She said her store managers are not just employers, but mentors, counselors, parents, and best friends to many of these kids. And, she added, for the kids, it makes a difference in their attitudes and the quality of their work.

As the conference wound to a mid-day close, some participants headed for the spa, while others lit out for an afternoon on the exquisitely manicured links, and perhaps a couple more days at the Broadmoor. But as they headed home, whether just up the road to Denver or clear across the country, all had pockets full of business cards and pages of notes filled with information and ideas gleaned from sessions, speakers, and friends old and new.

Next year's event is sure to provide further premiere opportunities for multi-unit operators to sharpen their skills, accelerate business growth, and continue building their portfolios, whether through one brand or many.

Published: August 3rd, 2007

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Multi-Unit Franchisee Magazine: Issue 3, 2007
Multi-Unit Franchisee Magazine: Issue 3, 2007

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