Professional athletes form team to buy Burger King franchises

Accord is part of a push by the fast-food chain to raise its urban profile

Keith Reed of The Boston Globe Staff reports that Kevin Faulk, is sweating it out on the field at training camp with the rest of the New England Patriots, but that’s not the only place he’s planning on making an impact this season.

While getting ready to don the pads and helmet for another run at the Super Bowl, Faulk and four other current and former black professional athletes have pooled their money to buy 18 Burger King restaurants in Norfolk and Richmond, Va. The deal represents a new attempt by Burger King Corp., the Miami-based fast food chain, to grow its presence in urban areas. It is also an arrangement that allows Faulk, a native of Lafayette, La., to fulfill a goal of providing jobs to others whose backgrounds he can relate to.

“I watched how hard my mom and dad worked. When you’re young, you don’t realize the value and importance of hard work, but now I appreciate that,” he said. Faulk said he learned about the Burger King deal through a business associate. After looking over the details, Faulk said, he was enticed by the fact that many of the restaurants were in predominantly black neighborhoods, and that other current and former star athletes he knows — like National Football League Hall of Famer Marcus Allen and New York Giants defensive end Michael Strahan — were partners in the transaction.

A reason Burger King was eager to make the deal happen was that all four partners in the deal are black — Caron Butler of the National Basketball Association’s Washington Wizards and Donnie Edwards of football’s Kansas City Chiefs are the other two. The company wants to make inroads both in cities with high minority populations and among minority entrepreneurs, whose numbers it would like to increase among its franchisees.

In the late 1990s, Burger King attempted to address both issues through a deal with LaVan Hawkins, a black entrepreneur in Detroit who rose from being a street gang member to owning a restaurant chain that at one time included as many as 23 Burger Kings. Hawkins had a deal to open up to 200 Burger Kings in urban neighborhoods, but it quickly went sour and by 2001 the two sides were suing each other. They eventually settled, but Hawkins had bigger troubles: In 2005 he was convicted on federal perjury and wire fraud charges unrelated to his Burger King dustup.

Manny Portuondo, Burger King’s director of strategic franchising, wouldn’t comment on the Hawkins settlement or disclose how many of its 7,200 restaurants in the United States are minority-owned. But the company still needs more minority franchisees, he said.

“These communities make up more than 30 percent of the US population. There’s strong minority business growth in the US; these are demographic trends that make it a good business move for us to get these guys in,” Portuondo said. “Regardless of what may have happened with LaVan Hawkins, it’s in Burger King’s best interest to look at how to expand into the minority community, to grow our minority and diversity inclusion efforts.”

That doesn’t mean Burger King will always turn to black celebrities when looking to increase minority inclusion. The company has a minority franchisee in Boston who declined through a Burger King spokesman to be identified or interviewed for this story.

Still, pulling together wealthy athletes may have been one of the few ways to get a large deal like the one involving Faulk done, given Burger King’s stringent financial requirements on franchisees. A potential owner must have a net worth of at least $1.5 million, including a minimum of $500,000 in cash or some other liquid asset, to be considered for one restaurant.

In this case, there were 18 restaurants being sold after the franchisee who owned them decided to cash out and retire. George Miller, a former Burger King vice president, had been looking for financing to buy some restaurants, and he contacted Allen, an NFL Hall of Famer, through Miller’s investment banker brother, Ed. A few months later, the deal was done.

Miller will run the day-to-day operations of the restaurants. Faulk said he wouldn’t have time to visit them during the season, but would try to during the off-season.

Cross Posted at: Let’s Talk Franchising

Follow up on the NexCen Pretzel Acquisition

From a NexCen Press Release:

The combined purchase price for the transaction is $29.4 million, and consists of $22.1 million of cash, and NexCen common stock valued at approximately $7.3 million. These transactions double the number of brands in NexCen’s quick service restaurant (QSR) portfolio, which also includes the premium, hand-mixed ice cream chains MaggieMoo’s(R) and Marble Slab Creamery(R).As of June 30, 2007, Pretzel Time and Pretzelmaker had a combined 376 franchised or licensed units worldwide. Of those, 327 are in the United States, with the remaining 49 international locations located in six countries.

For the trailing twelve months ended June 30, 2007, aggregate unaudited revenues for the Pretzel Time and Pretzelmaker brands were approximately $6.4 million. NexCen estimates that aggregate revenues for the two businesses for the full year 2007 will be approximately $6.7 million. Based upon the partial year of ownership, NexCen expects to recognize approximately $2.7 million of revenue from the businesses for the remainder of 2007. NexCen expects these transactions to be accretive in 2007 and, after integration into NexCen’s operations, to generate combined operating margins of approximately 60%, consistent with NexCen’s expectations for its QSR franchising operations.

First, paying 5x revenue is absurdly high for an established traditional business with low barriers to entry and similar competitors. Most companies would pay 5 times EBITDA (earnings before interest, taxes, depreciation and amortization), and I imagine an organization like Pretzel Time and Pretzelmaker have expenses and obligations or close to the revenue figure. The stock market noticed the same overpriced acquisition along with other trouble at NexCen as the stock price dropped by almost 50% in the past few months:


Not good. NexCen also owns brands The Athlete’s Foot, Bill Blass, MaggieMoo’s, and Marble Slab.

Pet Franchises

Pampered pets

This year, Americans will spend an estimated $40.8 billion on pets — almost double what they spent just a decade earlier, according to the American Pet Products Manufacturers Association.

With about 7.1 million U.S. pet-owning households, national brands such as Origins, Harley-Davidson and Old Navy have created pet-friendly lines of clothing, accessories and wellness products.

Entrepreneurs are following suit with an interest in the rising status of the posh pet.

At least a dozen pet-related businesses have opened in the Oklahoma City area within the past few years, including a spa and resort, a home-based pet portrait studio, bakeries, professional poop scoopers and several specialty dog boutiques.

We’ve discussed pet franchises before on this blog. All things being equal (which they never are in real life), it’s easier to be grab market share when the customer base is expanding, and the customers are accustomed to spending for posh accessories and convenience.  Unless your products or services is noticeably unique, competition will rise and prices will drop.

The poop pickup business is very good business and has been profitable for the aggressive entrepreneurs and franchisees. Pet Butler has been growing very fast and is establishing a professional brand and franchise system, Happy Tails Dog Spa enables its customers to watch their pets on a webcam all day long, and Bark Busters helps you spend more quality time with your dog by training it to behave.

The Franchisor’s Owner Matters

Business are bought and sold with more frequency today than ever. Franchisors tend to receive high valuation based on untapped global growth opportunities, making them more likely to be acquired by other franchisors or private equity firms looking to leverage the brand and generate cash flow.

Case in point: Dunkin’ Donuts. Last year, Dunkin’ Donuts was acquired by a group of private equity firms. Their strategy is to position Dunkin’ Donuts as a higher end brand to compete with Starbucks head-to-head, including in the grocery aisles. The primary focus is to increase their return on investment, which doesn’t necessarily align the interests with their franchisees.

Grocers to Sell Dunkin’ Donuts Coffee

In addition to many small retailers, big-box retailers that will sell the coffee include Wal-Mart Stores Inc., Target Corp., Costco Wholesale Corp. and BJ’s Wholesale Club Inc. Also on board are drug chains CVS Caremark Corp., Rite Aid Corp. and Walgreen Co.

But most of the retailers are supermarkets. The list includes Kroger Co., Pathmark Stores Inc., Albertson’s LLC, Shaw’s Supermarkets Inc., Acme Fresh Market Inc., Publix Super Markets Inc., Shop-Rite, Stop & Shop Inc., Giant Brands Inc., Roche Bros., Safeway Inc.’s Safeway and Dominick’s stores, and The Great Atlantic & Pacific Tea Co.’s A&P chain.

How much of the franchisee’s sales were derived from in-unit packaged coffee sales? Probably a small portion, and the profit margins on packaged coffee beans are nowhere near the cup of coffee margin of 95%, but with the consumers bypassing the visit for a “cup of coffee” and a “pound of medium-roast beans”, same-store sales will be negatively impacted as a small portion sales shift from the franchisee to grocery. Obviously, the new owners ran the numbers and any slowdown in franchisee’s sales will be more than made up for by the P&G coffee distribution deal.

How to Protect Yourself

The impact of brand leveraging through distribution deals and internet sales by the franchisor is increasing feverishly and should be considered when buying a franchise. There is really only one way to protect yourself. Ask the franchisor to include a cannibalization clause, or more nicely called a “territory commission” in the franchise agreement to credit or pay you as the franchisee a percentage of all sales derived in your buffered territory as compensation for your lost opportunity and lost sales, and to align your interests with the brand regardless of whether the sale transaction takes place in your store or a retail outlet.

UPDATE: August 15, 2007 1:30 pm CST
Jim Coen posted in the comments reactions he gathered from gathered reactions from members and the President of the Dunkin Donuts Independent Franchises Owners, Inc.:

I asked fellow New England Franchise Association member his take on the recently announced coffee distribution arrangement with Dunkin Brands and Proctor & Gamble, here is his reaction:

Mark A. Dubinsky, President of the Dunkin Donuts Independent Franchises Owners, Inc. (DDIFO) stated in an email that the DDIFO is diametrically opposed to Dunkin Brands announced program in its current format to distribute packaged Dunkin coffee in retail outlets. DDIFO firmly believes that this program will harm countless franchisees who enjoy the sales of pounds of coffee in their restaurants today.

Notwithstanding DDIFO’s objections, Dunkin’ Brands has opted to contract with Proctor & Gamble to sell Dunkin’ Donuts coffee in mass distribution channels, bypassing standard (franchisee) outlets in the process. This distribution program was created in the name of “increased brand awareness.”

DDIFO believes if the brand wanted to do better expose Dunkin’ Donuts Coffee in unrepresented or underdeveloped markets, this strategy could make considerable sense. DDIFO also feels to do so in New England, Dunkin’ Donuts oldest and mature market (with franchised restaurants approaching one retail site for every 6,000 in population), to be disingenuous, at best, or shear lunacy, at worst.

The following are comments to this program from three DDIFO members:

“It’s my opinion that Dunkin’ is trying to emulate Starbucks whose coffee is offered for sale in supermarkets,
the big difference being that Starbucks is corporately owned and Dunkin’ is 100% franchisees. It appears as if Dunkin’ wants to operate as a 100% company store (scenario) to the detriment of their franchisees.”

“I am shocked though not surprised that Dunkin’ Brands would consummate this deal with P&G. I understand the need to make consumers aware of the brand but I feel that this move will further damage the relationship between the franchisee / franchisor and erode the profitability in each and every restaurant. Dunkin’ Brands should always remember that the franchisees are the ones that made and continue to make this brand the success that it is.”

“The DDIFO should continue to communicate to its members the happenings of this deal and any changes and/ or updates that may arise. Also, I see no problem with going to the media to put our voice and reaction to the public.”

DDIFO urges Dunkin’ Brands to reconsider and correct this ill-conceived marketing strategy.

Great work, Jim!

A Neighborhood Balks at a Franchise

The New York Times reported in an article by David Gonzalez that:There really is a John inside Johnny’s Pizza in Sunset Park, Brooklyn — John Miniaci Jr., whose father, John Sr., founded the neighborhood pizzeria in 1968.

There will soon be another John right next door on Fifth Avenue — Papa John’s Pizza, a franchise outlet. John Jr. considers this as an insult to his own papa John, who died just one month ago. Of all the spots the franchise could have chosen, why, he asks, did it have to be on the other side of the wall where two centurion busts stand guard above customers waiting for zeppoles or Sicilian slices?

“This is a neighborhood that has had businesses in the same family for two and three generations,” Mr. Miniaci said. “These big corporations come in and don’t see the value of that.”

That’s why Johnny’s latest delivery is a petition — to Papa John’s corporate headquarters in Kentucky. Some 2,200 people — shopkeepers and customers, including other pizzeria owners — have come to Mr. Miniaci’s defense. They have signed a declaration “to stop the establishment of Papa John’s in our neighborhood.”

This Brooklyn community has been grappling to maintain its character in the face of impersonal economic and residential development. The storefronts along Fifth Avenue near 58th Street have long been home to mom-and-pop stores and restaurants, patronized by the working families who live in the brownstones on narrow side streets. The stores have awnings that announce “Decent Dental Services” or “Spanish and American Food.”

Many were here when the area was down on its luck and real estate values were low, and are determined to keep the neighborhood’s traditional feel, even as they see chain stores and fast-food franchises creeping in.

Read the whole story: Let’s Talk Franchising

Behavior Around Disabled Employees

This should be obvious to franchisees, but do not act or allow employees to act, point out, or otherwise draw unnecessary attention to an employee’s disability. As the below Subway franchisee discovered, it cost him $166k in court awards plus (I’m guessing here) another $75,000 in legal fees.

Subway Franchise to Pay $166,500 for Disability Bias, Jury Rules in EEOC Lawsuit

The Dallas jury of five women and two men awarded former area supervisor Tammy Gitsham $66,500 for lost wages and emotional harm and an additional $100,000 in punitive damages in the EEOC’s suit under the Americans with Disabilities Act of 1990 (ADA) in U.S. District Court for the Northern District of Texas. The EEOC charged in the case that Subway Owner Robert Suarez and one of his managers subjected Gitsham to a disability-based hostile work environment, including teasing and name-calling, because she is hearing impaired and wears hearing aids.

EEOC presented evidence that Gitsham was forced to resign her position after both the owner and human resources/training manager repeatedly mocked her privately and in front of other employees, creating a hostile workplace, with taunts such as: “Read My Lips” and “Can you hear me now?” and “You got your ears on?”

McDonald’s chickens out on Boston Market

The Boston Business Journal reported today that Boston Market, co-created by Boston-based franchise guru George Nadaff, is being sold to Sun Capital Partners Inc.McDonald’s Corp., the Illinois fast-food giant that owns Boston Market, is selling the franchise to the Florida buyout firm to focus on hamburgers.

As of June 30, 2007, Boston Market’s total assets and total liabilities were $180 million and $89.1 million, respectively, according to Securities and Exchange Commission filings. Boston Market currently has 630 locations in 28 states.

In early August 2007, McDonald’s (NYSE: MCD) signed a definitive agreement for the sale of Boston Market. The company expects to complete the transaction in the third quarter 2007 and does not expect to record a loss.

McDonald’s acquired Boston Market’s operations for $176.2 million in May 2000. Since then, McDonald’s has pared down its partner brands, shedding Chipotle Mexican Grill (CMGB), Donato’s Pizza and its stake in Fazoli’s Italian fast-food restaurants.

“It was more a distraction than anything,” Morningstar analyst John Owens said of Boston Market. “McDonald’s is really singularly focused on the Golden Arches, so this was not a surprise to me.”

Sun Capital, which now owns Fazoli’s, has a portfolio that also includes bakery chain Bruegger’s Enterprises, Garden Fresh salad restaurants and cheese-and-meat retailer Hickory Farms. Two years earlier, Boston Market had run out of cash to pay creditors and filed for Chapter 11 bankruptcy protection.

Boston Market Corp., founded as Boston Chicken in 1985, expanded under the wing of franchise specialist Nadaff, who partnered with the founders in 1989.

Cross Posted at: Let’s Talk Franchising

Investment Alternatives

I’ve written several times that investing your $150,000 nest-egg in the public markets and working a reasonably fun job is an underappreciated alternative to applying it towards a franchise. This article cites a study by Vanguard’s founder John Bogle regarding a 25-year study of a diversified portfolio return that on average has yielded 9.5% annual return.

What would you hope your franchise is worth in 10 years? Does $372,000 sound good for a selling price, on top of the wages you earn by holding a typical job? The $372k is the approximately growth of your $150,000 investment in the market compounded at 9.5% annually for 10 years.

A great article on the lowest cost (0.15%) diversified publicly traded investment portfolio in the world is here

The decision to invest in and hire yourself to manage a franchise is a personal balancing test of many factors – lifestyle, family needs, risk tolerance, job satisfaction, financial goals, etc.  Satisfaction of an entrepreneurial itch is typically not met by franchise ownership because of the operating requirements and restrictions in the Franchise Agreement and Manual, which also constrains your income potential.  Most entrepreneurs want scheduling flexibility, tax advantages, no boss, net worth growth, ability to adapt business to maximize revenue, etc., which is minimal in single-unit franchising.

Factors Affecting Profit

Chipotle Serves Up Hot Earnings Growth, But Buffalo Wild Wings’ Sales Are Light

Buffalo Wild Wings same-store sales grew 8.1% at company-owned restaurants and 4% at franchised units.

Both companies face some thorny challenges moving forward, including rising food costs. Demand for ethanol has pushed up corn prices, which in turn has fattened the cost of restaurant staples such as chicken, beef and produce.

Cost pressure is not a huge issue for Buffalo Wild Wings this year because it locked in a favorable deal with its chicken-wing supplier in March. Analyst Will Hamilton of SMH Capital estimates the company is paying about 30 cents a pound less than the current market price. But that price is expected to go up when the current contract expires.

“The supplier will likely want a higher price,” said Hamilton, whose employer makes a market in Buffalo Wild Wings. “That’s a risk not quite factored in to the stock price right now.”

Another wild card is how consumer skittishness might impact Buffalo’s same-store sales in the second half of 2007.

“I have a general concern about the consumer as gas and other prices go up,” Hamilton said. “Comps will still be positive, but the growth could be slower.”

McDonald’s Snack Wraps a hit during off-peak hours

McDonald’s introduces another Snack Wrap

The product, introduced Tuesday, is the third chicken snack wrap offered in the past year. The wraps have helped McDonald’s bring more customers in during the usually slow afternoon hours and may give it a leg up over rivals like Burger King and Wendy’s, analysts say.

“It’s probably one of the better products we have seen in the last several years,” says Larry Miller, an analyst in Atlanta with RBC Capital Markets. “They have really attacked the mid-afternoon as an area of opportunity.” Along with expanded


Being part of a larger, publicly traded franchisor has its benefits, particular in innovation.  The CEO must respond to negative publicity such as law suits or poor quality control, and it must be able to “tell a story” why the stock price is undervalued.  The CEO’s story is usually that investors are not fully valuing the upcoming improvements in the product or service offerings, such as a new menu item, a new promotional campaign, a faster system of delivering to the customer, etc.  This dance with stock analysts help franchisees by ensuring that there is some R&D and brainpower behind executing better strategies and more profits.

Furthermore, being a franchisee where the frachisor is a publicly traded company has other often-overlooked benefits. Disclosure rules and various SEC compliance regulations place a heavy burden on the franchisor to honestly disclose information. For example, most publicly traded franchisors (see McDonald’s, Buffalo Wild Wings, Jack in the Box, Gymboree, Choice Hotel, H&R Block, Regis Corp, to name a few) disclose monthly or quarterly same-store sales results, and disclose some transaction involve the sale or purchase of stores. A potential franchisee can likely reap sales data from these SEC filings and press releases.

The franchisor’s executive team must sign-off on these disclosures, and releasing false information can result in jail and huge fines imposed by the government. Instead of pursuing a franchise with a private franchisor who refuses to disclose any earnings claims, perhaps limiting your evaluations to publicly traded franchisors is a prudent decision. For the same disclosure reasons, many investors limit their investments to publicly traded securities rather than delve into the restricted world of private placement investments.

Au Bon Pain franchise eliminates trans fats

BOSTON — Au Bon Pain has announced the 100-percent elimination of trans fats from its menu items, and the launch of a new Web site that provides in-depth nutrition information for consumers.

The updated Web site features a “Smart Menu,” where site visitors can search for foods that fit their specific dietary needs, build an entire Au Bon Pain meal and view the nutrition information for that combination of food choices. Users simply select a nutritional requirement to search by, such as low sodium or high fiber, and choose a category of Au Bon Pain products, such as soups, sandwiches or bakery.

The Smart Menu then displays the items in the selected category sorted by the nutritional requirement that the user selected, and users can add individual menu items to their virtual plate. The Smart Menu totals up the nutritional value of the items on the plate automatically, providing nutrition information such as net calories, carbohydrates, cholesterol, fiber, protein saturated fat and sodium. The Smart Menu also displays nutritional information for each individual item, as well as a list of ingredients.

The Web site’s Cafe Menu also provides the FDA Nutrition Facts panel for each restaurant menu item.

Sign a Rama First Franchise to Win U.S. Presidential E Award for Exporting Success

Sign-A-Rama, the world’s largest retail sign franchise, has been awarded the United States Department of Commerce’s Presidential “E” Award. Sign-A-Rama is the first franchise company to ever win the award.Commerce Secretary Carlos M. Gutierrez joined President Bush at the White House to present Sign-A-Rama , along with ten other organizations, with the “E” Award for excellence in exporting. The company’s export sales increased 700% in three years, growing from $1.5 million in 2002 to $12 million in 2005.

In attendance were president and founder Ray Titus and his wife Andrea. Also in attendance was Tony Foley. Foley is president of World Franchisors which has assisted Sign-A-Rama and countless other franchisors for many years with their global expansion goals. World Franchisors is comprised of an advanced team who helps other franchisors quickly and cost effectively sell master licenses and establish a strong presence outside the United States.

Also assisting the franchise with their success in export sales is the U.S. Commercial Service. This government agency is the trade promotion unit of the International Trade Administration and works with companies to help get them started in exporting and increasing their sales to new global markets. The Fort Lauderdale, Florida office was instrumental in Sign-A-Rama ’s export success and subsequently their being honored with the “E” Award.

The President’s “E” Award is the highest honor the federal government can give to an American exporting company. The award serves to recognize U.S. firms for their competitive achievements in world markets and their part in increasing U.S. exports abroad. This marks the 45th anniversary of the Presidential “E” Award created by President John F. Kennedy in 1961.

“Winning this award was a great honor for our company coupled with the privilege of meeting President Bush in the Oval Office,” says Ray Titus, president of Sign-A-Rama . “Since we began more than 20 years ago, we have grown to over 850 locations in 50 countries. We are extremely proud and honored to have the opportunity to have helped so many people over the years achieve their dream of becoming their own boss.”

Sign-A-Rama , headquartered in West Palm Beach, FL, uses cutting-edge industry software programs to provide a full range of comprehensive sign and graphic services to both the private and commercial segments of the business community.

Cross Posted: Let’s Talk Franchising

Bruster’s Ice Cream franchise warms to idea of co-branding with Nathans Hot Dogs

After growing a successful franchise selling desserts, Bruster’s Real Ice Cream  is ready to serve up a full meal.Tim Schooley reports in the Pittsburgh Business Times, that the Bridgewater, PA, based ice cream chain recently began a strategy to co-brand its stores with The Nathan’s Famous Corp., the publicly traded New York-based hot dog chain known for its nationally televised Fourth of July hot dog-eating contests.

So far, six of Bruster’s 260 locations have become two-in-one Bruster’s/Nathan’s stores, including the region’s first in Dormont, said Dave Guido, vice president of concept development for Bruster’s. Two more area locations are slated for conversions, said Guido, estimating that 15 to 20 Bruster’s could operate jointly with Nathan’s by the end of the year.

While Bruster’s only began testing the co-branding strategy in February, and the Dormont location was the pilot store, Guido sees broad potential from early sales tallies, which he declined to disclose. “The results are going to tell the tale. But early on, we’re very, very happy with how it’s gone,” said Guido, adding the company is considering co-branding with other franchises, although he declined to name them.

“If we continue to get favorable results, it will be an option for everyone who is an existing store.”

Randy Watts, vice president of operations for Nathan’s, sees the co-branding franchising effort as a way for Nathan’s to reach new markets through Bruster’s territory, which extends throughout the eastern United States.

“It seemed like a natural synergy for the two brands to use their real estate a little better,” Watts said. “We’re the No. 1-selling all-beef premium hot dog in the world. We definitely think they have a real top-quality ice cream brand.”

Co-branding is nothing new for Nathan’s, which also owns Kenny Rogers Roasters. Nathan’s also operates joint locations with Subway in Wal-Mart locations, Sbarro and Pizza Hut, among others.

Bruster’s began considering teaming with Nathan’s because it wanted a daytime component to add to its made-from-scratch ice cream, which sells better at night.

Adding Nathan’s to established Bruster’s locations has not been complicated.

Besides adding a fryer and a few other pieces of cooking equipment, as well as new signage, Bruster’s expanded its menu to include hot dogs, french fries, chicken tenders and lemonade.

Co-branding in franchising is an increasingly popular formula employed by such companies as Yum! Brands, which often operates its Pizza Hut, Taco Bell and KFC restaurants out of single locations.

“The advantage is you save money in management and personnel,” said Gary Garda, principal of Downtown-based TLC Brokers/Garda Realty, and formerly an area supervisor for Pizza Hut.

“With Yum! Brands, you have one manager managing three concepts in one location.”

Garda also said rising real estate costs made it increasingly difficult for a fast-food chain to exist on a single-menu item alone.

Cross Posted at: Let’s Talk Franchising

Comfort Keepers Franchise Purchased by a Boston Private Equity Firm

The Dayton Business Journal reports that Allied Capital Corp. will pay $45.2 million to support the buyout of Comfort Keepers Franchise by Boston-based private equity firm Webster Capital.

CK Franchising Inc., which provides home care around the country as Comfort Keepers, has been sold to private equity investors.

Dayton, Ohio based CK Franchising operates more than 500 Comfort Keepers franchises in 46 states and seven countries.

“Both companies have long histories of identifying strong companies with significant growth potential and providing guidance and resources for growth,” said Jim Booth, president and chief executive officer of CK Franchising. “This is an ideal marriage for CKFI and our franchisee owners.”

Comfort Keepers ranks as the area’s seventh largest home health care agency with $4 million in 2006 revenue, according to Dayton Business Journal research.

Cross Posted at: Let’s Talk Franchising 

Qdoba Wants to Expand Despite Lack of Franchisees

Mexican-food chain to expand in Chicago area

We thought we had more interest from our franchisee base (in Chicago), but we didn’t,” Mr. Beisler said. “But we’re pleased with our existing

Qdoba plans to focus on opening corporate-owned restaurants from the northern border of Cook County down to Indiana. One franchisee has purchased the right to develop Qdobas in Lake County. The company is counting on its established stores in the Indianapolis, Milwaukee and St. Louis areas to boost brand recognition in Chicago.

After seven years of same-store sales growth, Mr. Beisler said now is the time for Qdoba to aggressively expand into markets such as Chicago, Manhattan, Seattle and Minneapolis. The company currently has 375 stores in 40 states.

Qdoba — a made-up word that Mr. Beisler said resonated with him — serves burritos, salads, soups, nachos and tacos.

There’s nothing really Mexican about cilantro lime rice, poblano pesto or tortilla soup,” he said. “We’re modern, nouveau Mexican.”