Andy Kuntz is committed to strengthening his namesake by focusing on the quality of his company's creamy product, a healthy employee environment and committed franchisees.
With franchising starting to take hold, Andy's Frozen Custard Inc. is on track this year to open its 21st store, but the president and co-owner of the Springfield-based company said he is more concerned about the custard and the people.
"This is not about selling more franchises. It's about selling more frozen custard, and it's about finding people who can operate those stores and do it efficiently," Kuntz said during a live interview this morning. "Our terminology for success is probably not dollars - it should be maybe dollars and eventually it is dollars - but it's about successful stores that are run properly."
Three weeks removed from the company's 18th store opening via a franchisee in Tulsa, Okla., Kuntz sat down today with Springfield Business Journal Editor Eric Olson as a part of the monthly 12 People You Need to Know series at Hilton Garden Inn. Roughly 100 people attended the event, packing the room to capacity.
With the launch of its newest store, Andy's now operates 11 corporate-owned locations and delegates the other seven through five franchisees. Kuntz said the company seeks franchisees with a net worth of at least $1 million, with franchise fees assessed at $32,000 for the initial store and $28,000 for each additional store. Royalties begin at 6 percent and slide down on a curve depending on the number of locations. All told, Kuntz said the initial investment could be $1.5 million for a single store. But with the expenses comes the potential for big gains.
"Ninety percent of our stores exceed $1 million [in revenue annually]," Kuntz said, noting the Springfield location on South Campbell Avenue near James River Freeway is the company's top seller at $1.8 million per year, followed by its store on East Sunshine Street.
New franchisees spend 30 days training with Andy's staffers, followed by corporate employees visiting their stores for three weeks. It's part of a stringent protocol focused on protecting the company's brand, though Kuntz admits the company is still learning the franchise model and is fine-tuning its process.
"This is like our little baby that has grown up in the family for 27 years. We're afraid to let anybody have it," Kuntz said. "We almost talk everybody out of an Andy's franchise; it's like, 'Do you really want to do this? Do you really want to work nights and weekends and scrub buckets?'"
A benchmark, Kuntz said, would be reaching the 100-store mark, but he said the company isn't focused on growing too fast or too far.
"If we see one getting off track, we try to help them. We're at the store every month at least. In the early days when the store opens, we're in every week," he said. "That's why we haven't expanded too far one way or the other. We've had requests from Florida, from wherever, California.
"For us to open a store in Florida, it would kill us. We couldn't operate it. We couldn't be there to see it; it wouldn't make sense financially. We'd lose money trying."
Andy's stores span as far west as Tulsa, as far south as Tyler, Texas, and as far north and east as Chicago. Three stores in Kirkwood, Fayetteville, Ark., and Countryside, Ill., are slated to open by October. Even at 18 stores, Kuntz said there is room to grow, with employee training remaining a key focus.
"It's not that we want to be good at what we do, we want to be the absolute best," he said.[[In-content Ad]]
An updated Lawrence County Health Department facility is under construction in a new development area on the south side of Mount Vernon, according to project officials.
