Whether it’s selling sandwiches or selling franchises, Firehouse Subs CEO Don Fox knows there’s a common bond throughout the Jacksonville-based business that generates success: its people.
“You can make time and have capital, but people are the toughest part of the equation,” said Fox. “It’s absolutely critical and true of all businesses.”
Fox was the keynote speaker Thursday to a meeting of the Association for Corporate Growth North Florida Chapter at Epping Forest Yacht Club and shared the Firehouse story.
The business is actually two businesses in one now, he said. It consists of selling subs and also selling franchises for the expanding fast-casual sandwich shop.
The chain has 450 locations, and upcoming franchises in Puerto Rico, with more than 6,000 employees.
Each area has a representative who oversees stores in a region.
Fox said that success and failure at each location “always comes down to the people” who run the stores.
“The brand is fundamentally sound,” he said.
Fox talked about founders Chris and Robin Sorenson’s business model of frugality and caution when determining investments.
There aren’t that many “A” sites primed for expansion, Fox said, so patience in letting a market develop is key.
Potential franchisees are the ones who propose sites to the leadership team, which helps with their commitment. New sites have to meet or exceed studied averages for an area.
If chosen, the location, combined with a franchisee’s financial investment, equates to “skin in the game,” he said.
Outside of selling franchises, Fox said the business hinges on what it does best: selling subs.
“We can’t be a successful franchise if we’re not selling successful subs,” he said.
Fox said franchisors of any business have to enforce brand standards and challenge franchisees to meet them.
Loyalty to a brand, he said, comes from consistency of a high-standard product and for the people involved to look for ways to “’wow’ customers by doing things not in the book.”
In addition to the brand standard being enforced, the Firehouse’s financial model must also be maintained to ensure success for both the franchisor and franchisee. Rarely, Fox said, will you find Firehouse distributing coupons.
He said coupons don’t promote brand loyalty and that the same is true for catchy promotions competitors use.
“You won’t see Firehouse do a $5 footlong,” Fox told the group.
He said the company will not compromise its ingredients to fit such a promotion and franchisees will not make money with such deals.