Just as Canada celebrated its 150th birthday this year, these three franchises are also celebrated big milestones in 2017. Here, franchisors and franchisees from three established brands reflect on their decades of success in Canada, and offer tips on how to achieve longevity in franchising.
Humpty’s – 40 Years
The Canadian franchise landscape has changed significantly over the past 40 years, and Don and Jan Koenig have seen it all.
Back in 1976, the husband-and-wife team bought a Calgary catering company, which included three soup and sandwich restaurants. After researching the market, they made a strategic move to enter the underserved all-day breakfast category, and converted one of the restaurants into a Humpty’s Egg Place in 1977.
In 1980, they opened a second Humpty’s location, and began to receive franchise inquiries. “We ignored them at first,” says Don Koenig. “We didn’t have a clue about franchising. We were just trying to make a living.”
Back then, franchising was still a relatively new business model, and prospective franchisors came under intense scrutiny from regulatory bodies like the Alberta Securities Commission. Adding to this, would-be franchisors had little access to information and resources in the pre-Internet era. “Back then, it was very hard,” Koenig recalls. “You couldn’t even collect a franchise fee until the place was open and the franchisee was satisfied. That’s how controlled it was.”
After hiring a lawyer to help them prepare their franchise agreement and disclosure documents, the Koenigs were ready to franchise. Their next challenge was finding their first franchisee. Despite having four profitable corporate locations by then, potential franchisees weren’t willing to invest without speaking to an established franchisee first.
Eventually, a bank manager from Red Deer, Alberta decided to take the plunge, and opened the first franchised Humpty’s restaurant in 1986. His location was a success, leading to the sale of three more franchises. “That opened the gates because, all of a sudden, we had a selling tool,” says Koenig, illustrating the importance of finding the right first franchise partner. “You have to ensure that first franchisee is going to make it.”
To set franchisees up for success, Humpty’s offers a seven-week training program and handles lease negotiations, equipment, design, and location setup. “When they get into our locations, it’s total turnkey.”
And the support doesn’t end there. Says Koenig: “One of our strengths has been our continual support to our franchisees,” which includes full-day field visits every three months, plus professional accounting and advertising support. “You can’t forget about the people who have entered into your system.”
Another strength is their ability to innovate. In 1988, they changed their name to Humpty’s Family Restaurants to reflect that they had grown their menu to include more than just breakfast. They regularly update their core breakfast menu to stay competitive, and keep their restaurants looking fresh and modern with renovations and upgrades.
After 40 years in franchising, Koenig says the most rewarding part is empowering others to succeed. “We’ve had franchisees who were with us since day one who retired with us,” he says. For example, one franchisee was so successful, he built the biggest house in his community and named it The Humpty House. “Anytime you see success like that, it’s by far the most satisfying part about franchising.”
McDonald’s Canada – 50 Years
By the time McDonald’s iconic Golden Arches arrived in Canada in 1967, it was already an established brand in the United States, with more than 700 locations. The first Canadian location opened in Richmond, British Columbia in June 1967.
That location, now owned by multi-unit franchisee Joe Guzzo, was recently renovated to reflect McDonald’s modern new look, with stone and wood finishes and self-order kiosks. The restaurant reopened in June 2017 after a six month renovation – just in time for its 50th anniversary. To mark the occasion, the restaurant’s original Golden Arches were returned to the site.
“Returning the iconic Golden Arches to their original home is a very special moment, and one that we are happy to share with the community, residents, and long-time guests,” Guzzo said during the reopening celebration. Guzzo began his career with McDonald’s over four decades ago, at Alpha and Hastings in Burnaby, BC, first as an employee and now as a multi-unit franchisee with 13 locations. “I’m thrilled to build on the rich history that this location has by modernizing the restaurant and the experience for all our guests.”
Although the restaurant reopened with a modern new look, there were a number of throwbacks to McDonald’s Canada’s 1960s roots at the reopening event, including vintage uniforms and cars, historical images, and a $0.67 hamburger special.
The reopening of the first McDonald’s in Canada was just one of the ways the franchise celebrated its 50th anniversary this year. In June, the company held a convention in Toronto attended by over 2,300 franchisees, including George Cohon, the founder of McDonald’s Canada.
Cohon had been practicing law in Chicago when McDonald’s founder Ray Kroc agreed to sell him the rights to McDonald’s Eastern Canada. Cohon opened his first location in London, Ontario in 1968, and went on to become the founder of McDonald’s in Russia. He also contributed to McDonald’s long history of franchise philosophy by founding McHappy Day, and Ronald McDonald House Charities in Canada and Russia.
In recognition of his career in franchising, Cohon was presented with the Canadian Franchise Association’s Lifetime Achievement Award this past April. “I’m incredibly proud of what we’ve accomplished,” Cohon wrote in his acceptance speech, calling the award “a testament to the achievements of the McDonald’s Canada team of franchisees and employees who have built our brand.”
McDonald’s Canada has undergone many changes since Cohon opened his first restaurant 50 years ago. While you can still find classic offerings like the Big Mac on the menu, customers today can now order salads and other healthy options, along with premium ingredients.
Reflecting this, the theme of McDonald’s 50th anniversary convention was “constant evolution,” and that has been key to the brand’s success over the years. That and the win-win relationship between head office and their franchisees. “I’ll leave you with a saying we have at McDonald’s,” Cohon said at the conclusion of his Lifetime Achievement Award speech. “‘None of us is as good as all of us.’ I can’t think of a better way to communicate the power of franchising. Our strength truly does lie in the sum of our parts.”
Pizza Pizza – 50 Years
When Mathew Heydari moved to Canada from Iran in 1986, he planned to work as a mechanic. A part-time job as a delivery driver for Pizza Pizza changed everything, launching a 30-year career with the Canadian pizza franchise.
Heydari worked his way through the ranks at Pizza Pizza, saved his money, and made the leap from employee to owner in 1997, opening his first restaurant in Milton, Ontario.
“Everybody wants to progress,” he says of his decision to become a franchisee. “It’s much more beneficial to own something and work for yourself.” After two decades as a franchisee – at one point juggling three locations – Heydari still loves what he does. On most days, you can find him at his current location in Toronto, where he usually works behind the scenes, managing the kitchen and administrative tasks, while his wife works on the front lines serving customers.
Seeing franchisees like Heydari make a better life for themselves is what motivates Pizza Pizza’s Senior Vice President of Franchising, Sebastian Fuschini, to go to work every day. “I love what I do,” says Fuschini, who has worked for Pizza Pizza for 36 years. “It’s really satisfying to see people you brought in 20 years ago thank you and say they’re glad they bought the business.”
To help franchisees succeed, Pizza Pizza provides extensive training and support. For Heydari, it’s the marketing support that’s been most beneficial. “They’re always looking to become more successful through marketing, and they do a better job than any individual can do,” he says. “It’s a big help, and allows you to do the rest of the jobs that need to be done to run a business.”
Cutting-edge marketing has always been part of Pizza Pizza’s formula for success; for example, you’d be hard-pressed to find someone in Ontario who doesn’t know the chain’s centralized phone number thanks to the catchy jingle that first aired on the radio in the 1970s.
Another factor in the brand’s success is its ability to change with the times. “The most important thing at the end of the day is our product,” says Fuschini. “We’ve been innovative with our product over the years, because demographics have changed in Canada.” Fuschini remembers the days when Pizza Pizza’s menu was limited to pizza and available only via delivery. Today, stores have been updated to accommodate in-restaurant dining, and customers can order everything from salads and chicken wings to sandwiches and pasta.
As the company turns 50 in 2017, it will be commemorating its anniversary throughout the year with in-store specials and celebrations across the network. “It’s a year of ‘thank you,’” says Fuschini. “We’re celebrating with our customers, franchisees, and employees.”
Fuschini’s enthusiasm for franchising extends beyond the Pizza Pizza brand. He currently sits on the Board of Directors of the Canadian Franchise Association so that he can contribute his knowledge and experience to help other franchisors and strengthen the franchise sector in Canada.
“Franchising gives people the opportunity to be self-employed, but with support,” he says of the business model’s importance. “It’s a win-win situation. We get to expand the brand, and they get to own a business for the family.”
Heydari agrees. “With a franchise business, you sleep better at night because there are other people to help,” he says. “It’s a team effort. If they’re successful, you’re successful, and vice versa – it works for everybody.”
With a 50-year track record behind them, Pizza Pizza and its franchisees have clearly perfected their recipe for success.
By Christine Rosal