Franchisee at the Top: Leading by influence pays off at Robeks
Name: David Rawnsley
Title: President and CFO
Company: Robeks Franchise Corp.
Years in franchising: 17
Years in current position: 6
David Rawnsley knows just what it feels like to be a franchisee. The president and CFO of L.A.-based Robeks recalls his days as a regional director and master franchise partner with the health food franchise that serves up smoothies, açaí bowls, and juices.
“I was in the Robeks system as developer and franchisee before joining, and then eventually leading, the Robeks corporate team,” says the 53-year-old. “I am still a Robeks franchisee today.” Today, however, he spends his time focused on corporate responsibilities while his wife operates their two franchised locations.
Rawnsley’s tenure with the brand began in 2005. He became a franchisee in 2008, took over as CFO in 2014, and added president to his title in 2015.
Although he runs Robeks from the corporate office, he prefers to lead its franchisees from the trenches through a leadership style he describes as “influence, rather than command-and-control.”
Under his leadership, the brand has sped up development by being “stubborn on destinations, flexible on tactics, and relentless on progress,” he says. The results include increased AUVs, new store buildouts, a new approach to all consumer-facing elements, a reimagining of the menu, and new product introductions.
Today, with the brand at 90 locations, Rawnsley says the company will continue to grow its unit count based on strong unit economics and dedication to providing a solid ROI to franchisees, “all predicated on providing great products and service to our consumers.”
What are your roles as president and CFO? As president my role is to take full responsibility for the brand and execute its mission to create delicious food that makes people happy. However, Robeks is more than the food we serve and the guests we serve it to. It is an ecosystem of investors, corporate team members, franchisees, store team members, customers, and vendors. I seek to maximize the rewards associated with the Robeks experience, whether as a guest, a store team member, a franchisee, a support center member, or an investor.
How has Covid-19 affected the way you have led your brand? Since Covid-19, I lead the brand with far more empathy than ever before. Covid-19 was unique in many ways. For example, it was the first-time restaurant franchisors had to weigh decisions about the success of their business against a real and imminent threat to the life and safety of their franchisees, team members, and their families. Franchisees and store team members were, and are, on the front lines. Franchisee interests are obviously extremely important in a franchised system. The pandemic made it crystal clear that franchisees are the most important stakeholder in the franchising ecosystem.
Describe your leadership style. It is odd to ponder this question after 6 years in this role. On my very first day as president, I asked myself how I was going to lead. I wrote down the answer on a Post-it note I still have. It reads, “Lead by influence rather than command-and-control.”
What has inspired your leadership style? I believe that by the time most people become president their leadership style is 90% innate based on their life experiences and 10% conscious thought. So much of my leadership style is based on my life experience as a Robeks franchisee for several years. Before assuming the role of president, I, like many franchisees, didn’t feel as though the brand leadership at that time sought enough input from the franchisees on the front line of our business. One of the first initiatives I undertook as president was to revamp our menu offerings. As part of the process, we brought 12 franchisees from various parts of the country and with various amounts of tenure out to Los Angeles and hosted a 2-day menu ideation session to help us shape the product offerings on our new menu. The final product was ultimately determined by the corporate team, but we received a great deal of constructive input and many of the ideas and suggestions generated by our franchisees were a part of the menu revamp.
What is your biggest leadership challenge? Recognizing that I can “please some of the people some of the time, but not all of the people all of the time.” In a franchise system with nearly 100 locations, there are numerous opinions about what we should and should not be doing regarding every aspect of our business, from the products we offer and the technology we leverage to the store decor and design… the list goes on. Although I believe that our corporate team has earned the faith of our franchisees, we always have a detractor or two. That is not something I can easily compartmentalize or leave in the rearview mirror.
How do you transmit your culture from your office to frontline employees? Everyone on the leadership team knows that our brand, our stores, and the individuals delivering on the brand promise do not live on paper or on laptops; they live in the 3-dimensional real world. If you want to influence and have an effect on them, you must meet them where they are. This means store visits are first and foremost. Our leadership team, in addition to our franchise business consultants, make frequent visits to our stores.
We also hold monthly franchisee webinars that are open to all of our franchisees. For those who cannot attend, the webinars are recorded and posted on our franchisee portal so they can replay them at their convenience. During these webinars we review the business, upcoming marketing plans, and operational issues with full transparency for our franchisees.
We also provide our Brand Guide to the stores for all team members to review. The booklet was originally printed for internal distribution, but it is a great way to communicate what the brand stands for and the organization to which our store-level team members belong. It contains our mission statement, a brief history of our vision, and our brand pillars.
How can a CEO or president help their CMO develop and grow? Give them the runway to take off with creative ideas while being grounded in the brand’s promise and vision.
Where is the best place to prepare for leadership: an MBA school or OTJ? Given I didn’t go to graduate school and don’t have an MBA, I am going to go with on-the-job training. However, I think my experience is somewhat unique in this regard. I was an economics major in college, knew I wanted to go into business because I had an entrepreneurial spirit as a kid (painted curbs, purchased chickens so I could sell eggs, had a paper route, etc.), but didn’t know what I wanted to do. I took a concentration of accounting classes, passed the CPA exam, and went to work for a public accounting firm as an auditor. My thinking was that to audit a transaction, you had to understand the transaction, and if you understood the transactions of a business, then you understood the business. It was great. I was an auditor for 3 years and had more than 30 different engagements before moving into private industry. The clients I worked on ranged from fashion and fragrance, entertainment, and demolition to real estate, education, and nonprofits.
I was working in finance and accounting when my wife and I started a family and thought that if I was ever going to go into business for myself, that was the time. I quit my job and spent about 3 or 4 months trying to find a business to purchase. I was not necessarily looking at franchising, but I found it appealing given there is a proven system in place with a great deal of support and reduced risk. I was drawn to the smoothie segment because I felt health and well-being would never go out of style, and because the segment was 10 years old at the time so knew it was not a fad.
Are tough decisions best taken by one person? How do you make tough decisions? Tough decisions are best taken by a team, but the team leaders answer to them. I make tough decisions by listening and considering input from different parties with different perspectives. I then consider those perspectives along with any available empirical data and make a decision. I should also add that direct experiences often help on “go vs. no-go” decisions. For example, before we moved to a new loyalty app provider, the team downloaded loyalty apps from numerous brands and identified the best experiences as a user before evaluating the loyalty providers on their pitch.
Do you want to be liked or respected? I want to be respected in my professional life and liked in my personal life.
Advice to CEO wannabes: I have a great relationship with the leadership team. However, it can still be lonely in the role as president from time to time. I suggest keeping the lines of communication open with peers outside of your organization and connect with them to share experiences. You will quickly realize there are a number of people who face the same challenges and enjoy the same successes, and your moments of loneliness will quickly pass. Creating and connecting with a network of peers will also keep you from operating in a bubble.
Describe your management style: Provide space, but never miss an opportunity to provide support.
What does your management team look like? We have a lean and productive team with a passion for the brand and a great deal of tenure.
How does your management team help you lead? Our leadership team meets weekly. We spend about 30% of our time on reporting and 70% of our time on problem-solving and initiatives. Each team member has unique professional experiences, allowing them to provide insights and make recommendations on whatever issue we are trying to solve.
Favorite management gurus: Do you read management books? I don’t know that I have a favorite management guru. However, I recently read The Speed of Trust: The One Thing That Changes Everything by Stephen M. R. Covey. It was a fantastic read that highlighted how significantly more efficient and effective teams can be when they are built on trust.
What makes you say, “Yes, now that’s why I do what I do!”? Visiting one of our locations and hearing from customers how much they enjoy our products and service, and seeing the pride our franchisees take in providing that.
What trends are you seeing with consumer spending habits in your stores? We were seeing two prominent trends pre-Covid. First an increase in digital orders and delivery, and second, an increase in average guest check. The pandemic accelerated these trends. We continue to see both digital orders and average check grow.
How is the economy driving consumer behavior in your system? Inflation is on everyone’s mind and affecting everyone’s purchasing power. Fortunately, we are serving freshly made, quality products at a very reasonable price point. We are not currently seeing a decline in traffic. It seems that family and casual dining are going to be more negatively affected by inflation and that we may actually benefit as consumers choose a more affordable meal replacement like a smoothie or avocado toast.
What are you expecting from your market in the next 12 months? We expect inflation to continue through the end of the year, but do not believe that will reduce traffic at Robeks.
Are your franchisees bullish or bearish about growth and adding units? Our franchisees are very bullish. We are adding new units at a record pace with more than 50% of that growth coming from existing franchisees.
Are commodity/supplies costs any cause for concern in your system? I think everyone is concerned about increasing commodity costs. Fortunately, we have a broad range of ingredients. So a spike in a few ingredients does not have the detrimental effect on our overall food costs that it would at a concept reliant on a single primary ingredient, such as poultry, beef, or cheese.
What time do you like to be at your desk? I am generally in the car by 6:00 a.m. Los Angeles traffic dictates what time I arrive at my desk.
Exercise in the morning? Wine with lunch? No exercise in the morning except for exercising my jaw. I spend a fair amount of time on the phone during my morning commute given that I am on the West Coast and we have operations or team members in the Mountain, Central, and Eastern time zones. I typically skip wine at lunch so I can have a double portion with dinner!
Do you socialize with your team after work/outside the office? I socialize with the team when we travel and would likely socialize outside of work if we had more time.
Last two books read: The Speed of Trust: The One Thing That Changes Everything by Stephen M. R. Covey and Pride and Prejudice by Jane Austen.
What technology do you take on the road? Phone, laptop, headphones.
How do you relax/balance life and work? Hmm… did I mention that my full-time best efforts are focused on the Robeks brand, and that my wife operates two Robeks franchised locations where both of my kids work part-time? Balance is not a word I am familiar with. We are Robeks 24/7. I enjoy what I do. The real answer to your question is carving out family time. Lately that is taken the form of Sunday breakfast. We take a country drive on back roads to a small city golf course for breakfast. The drive is about an hour each way with phones off. It is as much about the car time with no distractions as it is about breakfast. I also boat out to the Channel Islands several times in the summer. The closest island is only 13 miles from the coast and less than 60 miles as the crow flies from Los Angeles, but it feels like a lifetime away where we fish, hike, or go for an occasional swim.
Favorite vacation destination: Anywhere with my family.
Favorite occasions to send employees notes: I send each corporate employee a handwritten note and gift card on both their birthday and anniversary.
Favorite company product: Our Classic Avocado Toast: ¾-inch-thick sourdough toast, fresh avocado, drizzle of lemon juice and olive oil, chili flakes, salt, and pepper. It’s fantastic!
What are your long-term goals for the company? Continue to grow our unit count based on the foundation of very strong unit economics and return on investment for our franchisees.
How has the economy changed your goals for your company? Fortunately, the current economy has not tampered with our goals at all. We are in a health and wellness category, serving portable products that are good for you.
Where can capital be found these days? We are generating enough cash flow to fund our current growth strategy and are not currently looking for capital.
How do you measure success? By the degree to which I meet the expectations of all Robeks stakeholders. Over the long term, there is no set of standard performance indicators. Rather, I evaluate satisfaction year to year, month to month, and sometimes week to week. I measure success by whether our investors are satisfied with their return, our team members are satisfied with their career, our franchisees are satisfied with store ownership, and our customers are satisfied with their purchase.
What has been your greatest success? The evolution of our brand over the last few years has been significant and has resonated strongly with our consumers. This has translated to increased returns for our franchisees who, along with new franchisees, are growing our system.
Any regrets? No regrets.
What can we expect from your company in the next 12 to 18 months? Continued brand evolution, same store sales growth, and unit growth.
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