How A&W Got Its Soul Back
This story appears in the December 2017 issue of Entrepreneur. Subscribe »
Kevin Bazner spent 18 years working his way up to president and COO of A&W Restaurants. He loved helping franchisees across the country run their shops like small-town businesses. But in 2002, the company was acquired by Yum! Brands -- the corporate owner of KFC, Taco Bell and Pizza Hut -- and Bazner felt that local touch slip away. So he left to spend years in consulting. But in 2011, the chairman of the A&W franchise association called Bazner with some news: Yum! had put A&W up for sale, and a group of franchisees wanted to buy it back -- with Bazner’s help. A&W was independent again by the end of that year, and Bazner, now CEO, set out to empower franchisees. Between 2011 and 2016, same-store sales at U.S. stand-alone A&Ws increased an average of 28 percent, and the chain, which closed several units during the Yum! years, opened 45 new locations in 2017.
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What was your first order of business when you became CEO?
The typical turnaround playbook didn’t apply here. We needed to get out on the ground and get our franchise partners reengaged. Our COO and I spent two years visiting and talking with our operators, reassuring them that we were going to define our path forward together, working closely with our franchise partners as opposed to passing edicts down from the corporate office.
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What changes were inspired by those meetings with franchisees?
No disrespect to Yum! Brands, but they never really understood the soul of A&W, which has a lot to do with these independent operators that work their stores every day. One size doesn’t fit all. All our marketing and promotional activity has to be designed to work locally. We don’t have a large national media budget -- we leverage the relationships our franchisees have in their own communities and allow them to utilize their marketing dollars to participate in local events, such as sponsoring the Little League team. We also give them flexibility to offer regional menu items. We free them to do what they feel is best for their local business, with guidance and structure from the corporate office -- or what we refer to as the restaurant support center.
Were franchisees asking for that level of support?
We heard loud and clear that under Yum!, franchisees didn’t even know who to call. And there were no ill intentions on Yum!’s part -- it was just a large organization used to working with multiple-unit franchisees, who didn’t need much hand-holding. And today, our franchise partners know that somebody is going to answer the phone when they call.
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How do you ensure that new franchisees fit the small-business culture?
Where we are the most successful is in small towns, and that naturally leads us to the type of franchise partners that fit our culture. The real estate in smaller markets is a fraction of the cost, so our partners can acquire it and build family wealth for the long term. That’s our message as we’re out recruiting. We spend less time, frankly, trying to recruit large multi-unit operators. We want operators who are engaged.