Equal-Access Success

In The Zone

BY Michelle Prather | March 1, 1999|

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Blimpie sees opportunity in empowerment zones.

Since Blimpie International Inc.'s Urban Expansion Initiative began in December 1997, it's been a success. Now Stan Friedman, Blimpie's vice president of global development, has increased his efforts to see that quick-service dining is a reality for even more consumers, specifically those living in government-designated empowerment zones.

"These consumers have fewer choices because not everybody's running to the inner cities to build a business," says Friedman. Recognizing the lack of disposable income in these underserved markets but also seeing the potential their large populations offer, Blimpie has begun to expand the initiative under which it will award up to 500 franchises in empowerment zones and federally designated Enterprise Communities nationwide. Of the 500, the first 200 franchisees will be exempted from paying the $18,000 franchise fee, and the remaining 300 will pay "deeply reduced" initial franchise fees.

Thus far, six franchisees have committed to opening restaurants in the Atlanta market, where real estate and financing efforts are well under way. Detroit will also soon reap the program's benefits, as Blimpie launched the initiative there last summer. According to Friedman, "the most arduous" part of the process--sifting through applications--is the task now at hand.

Progression is slow and steady, but interest and support, especially from the federal government, are high. "There are a lot of people who want this thing to work," says Friedman. Goals in progress: finding debt-free capital infusion for empowerment zone franchisees and expanding to more to-be-announced zones this year.