Franchise Focus
Noodles & Co finally focusing on franchising: Why now?
John Ramsay, the newly appointed VP of Franchise Sales at Noodles & Co., describes why the Colorado chain is leaning into franchising after 25 years.
July 21, 2021 by Cherryh Cansler — Editor, FastCasual.com
Although Noodles & Co has been around for over 25 years and has a well-established national presence, franchising hasn't been its primary growth model. Out of its nearly 500 locations, only 77 are franchises, for example.
 |
| John Ramsay, became VP of Franchise Sales, for Noodles & Co in November 2020. |
Things are changing, however, according to John Ramsay, who became the Colorado-based chain's VP of Franchise Sales in November 2020. The 28-year franchise executive — who most recently led franchise growth at Bruxie International and Marco's Pizza Franchising — said that although the chain launched franchising nearly 21 years ago, it stalled 10 years later to focus on operations. Eleven legacy franchisees overseeing 77 restaurants remain, but part of Noodles' 2021 growth strategy is to tap new markets via franchising.
"We're not a regional brand, fad or trend but an established business with guests that connect deeply with our brand," he told FastCasual. "We don't have to educate guests on our menu or who we are in new markets because we have such a unique offering that is easy to understand."
Since relaunching its franchise initiative in February, Noodles has opened one franchised location in North Dakota and will add others by year's end.
"Being that the time from initial conversation to a restaurant opening takes about 18 months, we aggressively pursued franchise development this year knowing that we want to be poised for more growth going into 2022," said Ramsay, who recently chatted with FastCasual about the brand's franchising plans.
See below for the Q and A.
Q. Will Noodles still open corporate-owned locations?
A. Yes! We have a robust pipeline of new restaurant openings and anticipate opening around 10 corporate locations by the end of 2021.
Q. What is the goal over the next five years? Do you hope to get to a certain number of franchised locations, for example?
A. For us, it's about entering the right markets where we see opportunities for new growth, and currently, we are focused on the South in states such as Alabama, New Mexico, Texas and North Carolina. Our ideal candidate is someone with established roots in the market and is prepared to open anywhere from five to seven locations in that market. We expect to increase our franchise presence quite a bit over the next five years, and right now we're really focused on building quality relationships with potential franchise partners.
Q. Will Noodles keep the corporate locations corporate-owned, or do you plan to transition any of them to franchisees?
A.While that's always an option, it's not our top priority to transition corporate-owned locations to franchise locations. The focus is to build new, long-lasting relationships with experienced franchisees and together, enter a new market where there is a craving for Noodles & Company.
Q. Since Noodles has been corporate-owned focused for so long, how will you get the word out that you are ready to franchise more?
A. With the world having such a heavy reliance on digital communication over the last several years, especially last year, we're utilizing social media and our upcoming, redesigned franchise website to get the word out. We're also reaching out to the franchise industry through industry publications and speaking engagements to communicate the available franchising opportunities to interested prospects. Through social media, we can target geographically. We can tailor our marketing programs in our key growth markets and connect with a specific demographic who is potentially interested in franchising and has restaurant experience.
Q. What are the franchise costs including the royalty fees? What does it take to open one?
A. The average initial investment ranges from $774, 000 to $1.02 million, with an initial franchise fee of $35,000 for 20 years. Royalties include 5% of net sales and 2.25% marketing, which includes an administration fee and field marketing expenses. We work with our franchise partners from the first step, including site selection, construction and design to years beyond their grand opening, so they'll always have the full support of the Noodles & Company team.
7. What type of person is your ideal franchisee?
A. We're seeking qualified franchisees with an entrepreneurial spirit, prior restaurant franchise experience, and strong business acumen. We have a more in-depth process as we look at five points in a prospective franchisee.
- Restaurant experience
Do they have knowledge and experience in the restaurant industry including managing several restaurants and overseeing the day-to-day operations? - Financials
It's not just about having cash in the bank but having a relationship with a bank. In addition to having access to your own money, it's important to have access to borrowing money. - Development skills
One of the first things you have to do as a franchisee is finding a site, signing a lease, hiring a contractor, pulling the building permit, and building a restaurant. Our team of experts can help guide franchisees through this process, but it's great to have had real estate and site experience. - Business acumen
Franchisees who join Noodles & Company will have access to a team of experts who will support during every step of the process from initial site selection to marketing and training and beyond. And although you're following the procedure, process, and systems — it's ultimately their own business. We look for franchisees who are keen and have a good sense of business development. - Core values
We look for people who share our value systems and are a fit with our company culture. At Noodles & Company, our core values — We Care, We are Passionate, We Show Pride, and We Love Life — is how we run our business including the vetting process.
Q. What is something that you implemented or learned from your time at Marco's that you have or are in the process of implementing at Noodles?
A. During my time with Marco's we utilized an area representative model to provide field-level support for new, incoming franchisees. We learned how critical it is to have a strong, robust support network for a new franchisee in a new market, so at Noodles, we have created a network of highly qualified specialists in all areas (operations, training, development, etc.) so that new franchisees can focus on hiring the right staff, and preparing their business so that when they open they are fully staffed, trained, and prepared to provide an excellent guest experience for every new guest.
Q. As people are vetting franchises, what would make them want to choose Noodles as opposed to another chain?
A. Noodles & Company is a differentiated concept, being the only brand that offers noodle dishes from around the world in a fast-casual setting. With no direct national competitors, Noodles is a trusted and successful partner for franchisees looking to be part of a leading concept.
Having strong average unit sales and attractive unit economics, we provide a compelling franchise model that is well-suited to meet today's environment and the ability to adapt to the trends of tomorrow and years to come. There's a great opportunity for growth in major, untapped markets and we're looking forward to working with franchisees who are well connected in their community, passionate about food, and are excited to bring fresh, delicious noodle dishes to their market.
Q. Anything else we should know?
A. Noodles & Company is unique in that we are a category of one — there's no other restaurant concept offering what we offer. One of our brand's unique strengths is leading with variety and is the only national franchise that delivers global flavors through a core menu focused on noodles and pasta. From Zoodles to Cauliflower Noodles, Caulifower Gnocchi to Tortelloni, Noodles & Company introduces an innovative menu and fresh flavors to our guests accommodating any dietary preference making noodles and pasta an option for everyone.
About Cherryh Cansler
More From Franchise FocusMore
Related Media
FranchisingPresented ByJeff's Bagel Run
Subscribe
Get the latest news and resources from Fast Casual.
