What's in a Name?
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If you've ever picked up a sandwich, pizza or hamburger from a small counter or stand in a convenience store or mall food court, perhaps the name didn't ring a bell with you. You probably wouldn't guess this unit was part of a national chain more than 1,500 locations strong. With brands like Mean Gene's Burgers, Hot Stuff Pizza, Cinnamon Street Bakery, Smash Hit Subs and Nap's Alabama BBQ, Orion Food Systems Inc. is looking to dominate the "small name" restaurant world.
Even with 14 brands and units in the thousands, if customers don't know your tagline and menu by heart, what's the point of joining this type of franchise? Franchise Zone spoke with Mark Elliott, vice president of marketing for Orion, to learn how this franchise is managing to compete with the big names.
What is the benefit for someone to join your company as opposed to a household brand like McDonald's?
One of our competitive advantages is a slogan we have internally--one company, one contact, one call. [Franchisees who want to cobrand or franchise several brands] have to deal with the McDonald's guy and make sure they get that agreement right, and then they have to deal with the Subway guy and the Chick-fil-A [??] guy. Or they can come to Orion and get all those brands through one company, which makes it easier for them to work from a layout and design standpoint. We can be consistent in our appearance, we have the ability to share backroom food-service equipment. Generally, with the major fast-food franchisors, you have to use their specific equipment and you cannot mix and match any of the equipment with the other brands, nor can you share freezer space with the other brands. It looks like two brands in the front, but in the backroom we're sharing freezer space and some other equipment, so we're not duplicating efforts in terms of equipment. That's one of our big advantages over the McDonald's of the world.
We have a theory that as long as you look and taste like a national brand, consumers accept you as a national brand. Initially, people come in and they say, "Boy, I've never heard of Mean Gene's Burgers," but once they experience the great taste, the great service, they look at the menu board system, they look at the promotional materials, they look at everything that makes up that brand, it becomes their brand of choice.
When a franchisee joins your system, do they usually want to buy a specific concept or just sign on to your franchise in general?
I would say 90 percent of the time, they know they want a [specific] concept. For example, they call us for Hot Stuff Pizza, but a lot of times when we'll answer that call, we'll say, "By the way, you might as well do a Cinnamon Street Bakery alongside this, because by using some of the same equipment, you can also offer a breakfast option." The other 10 percent of the time, they're coming to us and saying, "I've heard of Orion. Sounds like you guys are doing good. I've reviewed your Web page, and I'm interested in doing a food court. Come in and tell me what you have and what you feel is best."
How are potential franchisees hearing about Orion?
I'd say our number one [method] is word of mouth. We have successful franchisees and success breeds success. Over 70 percent of our leads come from our successful franchisees who know of somebody. We have a very strong referral program within our franchise community base, where we'll actually pay them to track down leads for us. The rest of our leads come from trade publications, trade ads or trade shows.
As far as the individual locations go, are you somehow communicating to customers that these are all part of a larger parent?
The consumer doesn't know it's Orion. If they see the Eddie Peppers next to the Hot Stuff Pizza or the Mean Gene's Burgers, I would only assume they think those are three separate companies.
How easy would it be for one of your franchisees to move from one brand to another or to add on brands?
You've got to take that on a case by case basis. We built our business on being able to work in very small footprints--we've done Hot Stuff Pizza shops in as little as 80 square feet. In order to add a brand, sometimes it's very easy if they have the space and we feel we can add the incremental sales without taking away from the brand that's already there--we feel that's a win-win proposition.
Because different companies like Subway are doing smaller footprints, going into convenience stores and things like that, is it harder for your company to come in because you don't have as big of a name?
This is the land of the free, the land of the entrepreneur, so we welcome the competition and we really feel in a lot of our categories it's actually helped us. Food in convenience stores really wasn't well accepted by the consumer 10, 15 years ago, but now that McDonald's, Subway and Pizza Hut has done it, it's really opened up a lot of doors for our company by redefining the expectation of food service in a convenience store. I think it's lent credibility to what we're out to do.
What is Orion's main goal?
To be the biggest and best in the world. No, our goal is quite simply to grow 15 to 20 per year for ourselves and for our franchisees.
As the company grows, do you see the individual brands becoming bigger or the name Orion becoming bigger?
It will be the individual brands.
What do you see as some of the breakout brands in your company?
Hot Stuff Pizza, Smash Hut Subs, Cinnamon Street Bakery and Mean Gene's Burgers will stay steady for many, many years to come. We haven't even scratched the surface yet with those brands. We have some upcoming brands that I think are going to be very exciting. We have an Asian concept called Asian Creations that we've installed in several colleges and universities, and we just see great potential, great numbers with that particular brand.
You've mentioned those four brands you feel are breaking out right now. Do you think there might come a time when the company would shrink down and just focus in on those few brands?
I don't think so. There's just too much potential to be that one company, one contact, one call, and we're going to have to have a lot of toys in the toy box if we want to play.