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Turning college kids into franchisees

A quickservice chain setting up shop near college campuses seems logical enough. After all, if you're serving value-priced subs and pastas, what better customer to look for than a hungry college kid who's sick of cafeteria food? But as the DeSoto, KS-based Mr. Goodcents chain opened units near college campuses all over the Midwest, it soon saw a lot more than potential customers. To headquarters, those kids milling about in backpacks and baseball caps looked like potential franchisees.

"We find a lot of people this way," says Peter Grams, franchise development director for the 100-plus unit chain. "Some of them may have a business degree, but some may have a psychology degree, too. These are big opportunities for these individuals."

Actually, it's an opportunity for the chain, too. In the endless hunt for qualified franchisees, what company hasn't turned over every stone? Mr. Goodcents' recent strategy has been to deliberately court the college-kid population (ones either graduating and wanting to get into business, or ones looking to drop out to do the same thing) to ink those franchise agreements. The chain sets up tables at college job fairs. It puts ads in alumni magazines, too. It also hopes that college kids eating in nearby units will notice that the owners are their age, and be encouraged to sign up themselves. "We've even had kids coming right out of high school whose parents invest the money for them," Grams says.

Of course, dropping the front-door keys into the hand of a kid too young to shave might look more like a potential fiasco than an opportunity for many operators. Grams admits that many of the kids don't sport a lot of foodservice or business experience—or money, for that matter.

Yet in the name of expansion, headquarters has found it worth some extra work to bring the budding business owners into the fold. It instituted a training program that can last up to 30 days if necessary. It also makes a lot of referrals for financing (though the franchisee fee is a comparatively reasonable $12,500 and total startup costs average $150,000). Grams says it's not uncommon for his college-age franchisees to move back in with their parents in order to save the money necessary to open a unit. Grams points to a pair of young men that he plucked out of school in Nebraska who moved back home, saved their money, bought a franchise, and are now one of the system's most successful multi-unit operators.

In fact, apart from the experience/ financing issues, Grams maintains he "doesn't see a lot of challenges" in recruiting his green operators. Then again, learning to run a limited-service sub shop is bound to happen a lot easier than, say, rolling out the carpet of an Applebee's. "There are individuals who don't make it through the process," Grams admits.

Yet he vows his company will stick with the strategy into the future. "These kids are eager to learn, they're eager to put money in their pockets, and they're willing to work 17 hours a day," Grams says. "This has worked out great, and we're going to stick with it."

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