Change For The Better

Arby's CEO revamps for success.
Magazine Contributor
2 min read

This story appears in the April 1999 issue of Business Start-Ups magazine. Subscribe »

Forty-four-year-old Roland Smith's qualifications make his instinctive business tactics seem well-justified: He worked at McDonald's "way too many years ago," served as a marketing executive for Procter & Gamble and PepsiCo, and then joined Fort Lauderdale, Florida-based Arby's Inc. in 1994 to oversee marketing and international restaurants. Since becoming president and CEO of Arby's in February 1997, strengthening the franchisor-franchisee bond has been Smith's primary objective.

"We went right to the franchisees and asked them what [they thought] a world-class franchisor would do and how we were doing in that regard," says Smith. "We got a wake-up call." So in May 1997, Arby's sold all 355 company-owned locations to its largest franchisee because, as Smith found, "When you spend more time supporting your own stores than those of your franchisees, things fall between the cracks."

Franchisee-friendly tactics like support programs, field personnel, franchise councils and the Strategic Planning Group (composed of Smith, six franchisees and the president of Arby's Franchise Association) have also been implemented to give franchisees a sense of empowerment in decision-making.

Co-branding ranks high on Smith's priority list as well: The number of Arby's/T.J. Cinnamons restaurants has grown from one in 1997 to 320 at press time. The Arby's/Pasta Connection combination has soared to 24 and is still growing.

There's some redecorating going on, too: A new look--known as the "pinnacle" building--is now required for all new franchises, including the 1,000 domestic locations signed to open by 2010.

Annual franchisee surveys say Smith's changes have definitely helped. Systemwide sales projections aren't available (sales were $2.2 billion for 1998), but Smith says, "It's been a good year."

Contact Source

Arby's Inc., (954) 351-5155

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