Freshii CEO Matthew Corrin Sits Down With FranchiseHelp
FranchiseHelp's interview with Freshii CEO Matthew Corrin at the grand opening of its 39th and Broadway location in NYC. Freshii is a Chicago- based fast-casual / QSR (quick-serve restaurant) / retail restaurant food franchise concept offering convenient, healthy, freshly prepared meals and snacks in a modern, environmentally sustainable setting. Freshii restaurants feature a wide selection of quick and nutritious options, including salds, wraps, burritos, rice bowls, yogurt and soups in a "build your own" format, served fresh and fast to their busy consumer clientele.
Why is the Freshii Franchise Model Catching On?
1) Fast-casual type chains continue to drive growth in the restaurant industry.
2) Freshii's environmentally conscientious approach appeals to the 62% of consumers (according to the 2008 National Restaurant Association Industry Forecast) who say that they are likely to choose a restaurant based on how environmentally friendly it is.
3) Freshii's focus on quality ingredients and healthy meals caters to the 76% of adults and 73% of teenagers (according to the 2008 National Restaurant Association Industry Forecast) who indicate that they are choosing more healthy eating options when dining out.
For those of you who would prefer to read the official transcript, enjoy!
Below is the transcript of the FranchiseHelp interview with Freshii CEO Matthew Corrin at the Freshii 39th and Broadway grand opening in New York City.
Matt Wilson, FranchiseHelp: Hey, what's going on everybody? This is Matt Wilson from FranchiseHelp.com. I'm here with Matthew Corrin from Freshii. We're at 39th and Broadway in New York City. We're here to ask a couple quick questions about franchising. The first thing that I want to know is, within your model, what are some things that a franchisee can do to be a little bit more entrepreneurial and bring attention to their store?
Matthew Corrin, Freshii: I think the traditional restaurant mantra is, "If you build it, they will come." I think that is just so old school. So our philosophy is build it and then guerilla market the hell out of it to make them come. And so I think anybody who opens a store, no matter how good a location it is, no matter how much density there is, it doesn't work and it's not going to succeed unless they go outside of their four walls and really try to drive traffic, drive trial. So we really focus on those guerilla types of initiatives and drive that trial. Trial that once they're in the store, then our job is to then execute at a level that makes them want to come back. We offer them a menu and a price point.
Matt Wilson, FranchiseHelp: What type of guerilla stuff are you guys doing with Freshii?
Matthew Corrin, Freshii: We do a variety of things. We leverage social media a ton. So we're doing a lot of Twitter, a lot of Facebook-type campaigns. We love public relations initiatives. We opened in L.A. two weeks ago. We had Ryan Seacrest and Ashton Kutcher both Tweeting about our grand opening.
Matthew Corrin, Freshii: And so, with those types of things, within ten minutes I think it was 10 million people around the world now were introduced to what Freshii was, saw a picture with our logo on it. It was pretty cool.
Matt Wilson, FranchiseHelp: And was that something that the individual franchisee in L.A. set up, or was that you guys at corporate? How did that work?
Matthew Corrin, Freshii: It's a combination and with our public relations team as well.
Matt Wilson, FranchiseHelp: Okay. So, if somebody's looking to get into a business, whatever restaurant business it is, that subscribes to the franchise model, what are some of the things that they can do to make sure that they are well qualified to get into the business so that they are going to get approval and be able to move forward with the venture?
Matthew Corrin, Freshii: Well, I think it's a couple parts. One, you have to be operationally sophisticated. You have to be financially sophisticated. Then you need to have the work ethic. Those are the three elements I think that create a successful franchise partner.
Matt Wilson, FranchiseHelp: Okay. So, what and how can you, if you are going into an investment meeting with a franchisee, how do they display that to you? It's not like pitching to a VC where they have a presentation. How does that work out?
Matthew Corrin, Freshii: Well, there's the financial, which is just black and white. You can see a net worth statement, confirm that they are financially savvy to be able to actually build stores. Just operationally and meeting of minds, our strategy with franchise partners is, "Do I want to have a beer and pizza with this person on Friday night?"
Matthew Corrin, Freshii: That's really the way I think about it, because we spend and invest so much time with our partners in every market. I need to want them to be my friends. I think Freshii, and granted I haven't researched a ton of other franchise businesses, but our partners are so atypical and yet so similar within our system. So, they're all sophisticated, well-educated, hip, cool.
Matt Wilson, FranchiseHelp: Okay. So 400 stores in development, you could have a lot of beers with a lot of people, huh?
Matt Wilson, FranchiseHelp: That's pretty good. So, have you met every single person?
Matthew Corrin, Freshii: Oh, I mean, not only have I met them, but I meet them five times before we sign a deal.
Matthew Corrin, Freshii: It's part of my job, as CEO of the company, to make sure we're picking the right people, because you chose a bad franchise partner in Los Angeles and they're going to compromise the brand for Denver and for D.C. and for Dubai and for Vienna. So, they are relying on me to make sure we are bringing on the best partners for the brand.
Matt Wilson, FranchiseHelp: So, we're at 39th and Broadway in New York City. There's probably not more prime retail location than this right here. Is the cost different for the franchise? How does that work with the real estate?
Matthew Corrin, Freshii: Franchise fees and royalties remain consistent. It's not unlike any other franchise system out there. The thing about New York from a real estate perspective is obviously the rents are much higher. But the expected sales are much higher.
Matthew Corrin, Freshii: So, it all has to work in the unit economic model that Freshii subscribes to, and it's all based on percentage of sales. So even though the actual dollar value of rent is significantly higher than in another market, like Denver or Philadelphia, the top line sales potential is also significantly higher. So within line, they actually work from a ratio perspective.
Matt Wilson, FranchiseHelp: Interesting. If you had one thing to end off on for any franchisee out there that is looking to get into business regardless of what industry, what would it be?
Matthew Corrin, Freshii: Step one, Freshii.com/franchising, period.
Matt Wilson, FranchiseHelp: Cool, Matt. Thanks for being with us.
Matt Wilson, FranchiseHelp: We appreciate it.
What Would You Do with $25,000?
Have you ever had one of those days when you were just kind of fantasizing about what you would do if you had a crazy amount of money? I had one of those a couple of weeks back when I was looking for a new apartment. I decided to go onto an NYC realty site and take a look at what paying an absurd amount of rent gets you in the city. I was looking and came across one for $25,000 a month (and that’s nowhere near the top end) and just had to laugh. Of all the things you could do with $25,000 - paying one month’s rent on an apartment seems pretty nuts to me. But that got me thinking, what can you do with $25,000 - from rational to fun to downright wacky.
Breaking Down an FDD
Once you've found a franchise (or multiple franchises) that you are interested, the real research and diligence process begins. You need to figure out whether the franchise you are looking at really makes sense for you from a financial and lifestyle perspective. Your best source of information for all of this is the Franchise Disclosure Document, or FDD.