Focus Brands has a well-known restaurant roster that includes Auntie Anne’s and Cinnabon stores that are predominantly found in malls. The company had a record-breaking year in 2021 for both sales and franchise agreements.
Mall visitors are exceeding pre-pandemic levels and have been for the past several months, this was likely the cause for Focus Brand’s strong performance. Their successful year brought in 61 new franchisees and 175 new restaurant openings in the U.S. and Canada.
“One lesson this business learned from the pandemic is the benefit and the need for scale. I think that was part of the psychology behind [record franchise agreements] is people understanding we need to be a little bigger to protect bottom lines,” said Jim Holthouser, Chief Executive Officer.
He expects the momentum in 2021 to continue through this next year as brands generate stronger unit-level economics. Brands in their portfolio are taking the initiative to simplify their menus, add plant-based options and consider drive-thru systems. Nearly 100% of Focus Brands new brick-and-mortar properties will have a drive-thru, according to Holthouser.
The company will also accelerate their co-branded locations. Focus Brands plans to redefine this concept, and really think about the overall engineering processes of these types of stores. If this process works successfully, mall-based brands can be more appealing to customers, while significantly increasing their profit.
“I am interested in expanding into new categories of food that don’t overlap what we’re already doing. So I’m looking at pizza, chicken, burgers, Mediterranean, salad. We’ve got the balance sheet to do it and it’s just a matter of finding the right deal and the right fit. We won’t grow for the sake of growing but to bring in the right brand for the right reason. The more scale I have, the more muscle I have to control supply chain and third- party costs and make better and bigger investments in technology. I can be a better franchisor,” said Holthouse.
Source: Focus Brands – Forbes
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