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Business Observer Friday, Nov. 30, 2018 1 week ago

Smooth operator: Franchisee works the system to great success

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From the Army to fast food to healthy eats, businesswoman Emily Harrington serves one constant: people come first.
by: Brian Hartz Tampa Bay Editor

U.S. Army veteran Emily Harrington has been a Tropical Smoothie Café franchisee for just a couple of years.

She already owns five locations in the Tampa Bay area and recently signed on to run eight more, in Pasco County. Three of those are in various stages of development.

Harrington’s success is emblematic of the chain’s surge, which has seen it grow to some 700 restaurants nationwide since its first location in Tallahassee in 1997. The Atlanta-based chain has about 135 restaurants in Florida.

“We think we can easily double that number,” says CEO Charles Watson, in Clearwater recently to meet with potential new franchisees. “Brand awareness in Florida is very high, because it’s where we started.”

“The cost to get into the brand, from a build-out perspective, is a fraction of a lot of other national chains.” Emily Harrington, Tropical Smoothie Café franchisee

Harrington, 41, is doing her part to help meet that growth goal. Not only is she opening a slew of new locations, she’s also buying existing ones and making changes to improve profitability. It’s proof that even in the high-volume world of quick-service restaurants, quality is just as important as quantity.

For example, Harrington took over an underperforming Tropical Smoothie Café in downtown Tampa, at the intersection of Jackson and Tampa streets, about a year ago. She spent about $140,000 to remodel it. She also invested significantly in people, starting with hiring an area manager, Paul Schurr, who spent 20 years in the Pizza Hut system. Schurr has helped maximize her cafes' day-to-day cash flow, freeing up Harrington to focus on long-term strategy. 

“Downtown Tampa is blowing up,” Harrington says. “Our sales have gone up by double digits ... being on this corner is incredible. I predict that this location will end up being my highest-volume unit.”

Harrington’s current top-earning Tropical Smoothie Cafe, with about $1.1 million in projected revenue for 2018, is in Brandon. When she took over that location in 2016, its annual sales were $863,000. Combined revenue, across all stores, was $3.6 million in 2017. 

When she entered the Tropical Smoothie Café system, Harrington developed a strategy to buy the franchise rights to existing locations and capitalize on their turnaround potential. Some of those locations were distressed or underperforming.   

“It wasn’t cheap," says Harrington, who funded her investment from personal savings plus proceeds of the sale of several Hardee's franchises she owned. "But it was still a lot cheaper than going out, finding a new location, negotiating a lease, completely building a new store from scratch and getting it open."

Watson says Harrington’s rapid ascent to smoothie success can also be attributed to the disciplined way in which the U.S. Army veteran, who left the service in 2004 after five years as a Signal Corps officer, has “bought into our concept and bought into our system.”

Adds Watson, "She delivers exceptional products and service and puts people first."

In addition to the military, Harrington is also a veteran of the fast-casual restaurant industry, having owned and operated 42 Hardee’s franchises from 2013 to 2016. Then she cashed out of Hardee’s in favor of Tropical Smoothie. A fitness buff who also owns a gym, Harrington didn’t identify with the burgers-and-fries-centric Hardee’s menu and did not see in it a high ceiling for future growth.

“There’s a portion of the population that wants healthier choices when they dine out, and I think that segment is underserved,” she says. “I don't think there are a lot of good options, and so that, to me, explains why we're growing so rapidly."

Mark Wemple. Emily Harrington became a Tropical Smoothie Cafe franchisee in 2016 after selling her interests in the Hardee's system.

Harrington says another key to her success is "the cost to get into the brand, from a build-out perspective, is a fraction of a lot of other national chains.”

How so? The minimum capital requirement for a Tropical Smoothie franchisee is $125,000. But with real estate prices on the rise and providing a significant challenge to the development of new franchise locations, saving money on other aspects of the process allowed Harrington to allocate funds toward upgrades that would boost performance.

“To put it in context, my Hardee’s equipment package — furniture, fixtures, kitchen equipment, exterior signage — was a little over $400,000,” she says. “With Tropical Smoothie, my equipment package is a quarter of that.”

Of course, Tropical Smoothie Café is not as food-centric as a brand like Hardee’s, so it doesn’t require expensive gear like deep fryers and griddles. “It’s simple but not easy,” says Watson, explaining that when evaluating potential franchisees, the company looks for enthusiastic, motivated people who want to build their own company, not “buy a job."

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