Total Food Service sat down with the Sr. Vice President of Sonic Franchise Sales Bob Franke to answer some questions about franchising with Sonic.
What's the history behind Sonic®?
Sonic has been in business for over 60 years. It started as a “Top Hat” restaurant drive-in in Shawnee, Oklahoma in the '50’s. From there Troy Smith, who founded the company, liked the concept but altered it a bit. He added carhops and intercoms and in 1959, changed the name to Sonic Drive-In, building the original Sonic® in Stillwater, Oklahoma. We've taken it from there.
How many Sonic Drive-Ins are there?
Sonic began franchising in 1959 and has over 340 franchisees with 3,500+ Drive-Ins. All of our restaurants are equipped with the ability to drive traffic to 5 distinct dayparts: Breakfast, Lunch, Afternoon, Dinner and Evening. With our delicious food and drink offerings, we’ve become a brand Americans love and love to indulge in with family and friends.
It seems like beverages have been a key element of Sonic®?
We often tag different beverages on our TV commercials highlighting different seasons and drink offerings. Whether it’s our slushes or the ½ price afternoon Happy Hour, our frozen and fountain business is very important. And, we have slushes with Nerds® candy in them that our customers love. We had a big summer push last year. We’re doing it again this summer – with summer ice cream and drink favorites. We have over a 1.3 million drink flavor combinations alone. Drinks are about 30% of our business, ice cream, 10%.
What's the success behind your franchises?
Our franchisees and our brand are successful because of the unique differences that set us apart from our competitors. From our ability to deliver orders with our roller skating carhops, to our made-to-order menu that allows our customers to customize the way they like it, SONIC delivers to the varying taste profiles of Americans across the country. Given the extensiveness of our menu, it fits well in almost every region.
You have a great presence in southern states. Do you think you'll expand into the Northeast?
Sonic was a regional player with its roots in Texas, Arkansas, Louisiana and Oklahoma, the drive-in concept had good play with great weather. When the weather turns in winter, it’s tougher for people to stop by so we added the element of drive-thru for customer convenience.
Here's where the Northeast comes in. We went there 10 years ago, and built a handful of drive-in restaurants. We learned that for us to be able to service customers in winter, we needed a different environment for them. So, a few years back, we added an indoor seating model to keep customers coming back week after week as we got into the fall and winter season.
We’ve also seen increased demand from investors and operators wanting to be franchisees of Sonic®, because we now have a model that keeps the signature brand stalls while also being conducive to areas in the Northeast. We’ve been evolving because our customers always come first.
Where else are you thinking of developing?
We’re granting franchises nationwide, and now looking in urban markets. We've converted other restaurant brands and properties that were something else before, good real estate but which didn’t have the brand recognition we have. It's much less cost for franchises than starting fresh. There are many opportunities in urban markets to achieve that.
What do you look for in a franchisee?
As you know, the restaurant business is very hands-on. It’s all about the people and teams who service the customer. We look for franchise candidates who have been in a retail situation or who have enough capital but may need to partner with a savvy operational partner. We have a lot of partnerships like that – someone who has financial capability but not necessarily the operational experience.
Mix those two together and you have a really dynamic team to grow. Nothing can replace a good hands-on operator who understands service and quality, but it doesn’t have to be restaurant experience. We do a 12-week training program that goes through our equipment, how to train employees, how to coach staff and management, supply chain and all the software we use.
All our employees and franchisees go through this process. As part of their training they learn the recruitment process through a series of hiring management systems, to look at what makes a great employee, a great manager. That training helps them coach so they as franchisees can make decisions that are right for their community. The powerful thing about a franchise business is that the local owner operators call the shots. They're the entrepreneurs. We give guidance but at the end of the day, it’s all about that local personality and how they fit in that community. We provide the tools and the coaching and the franchisee takes it from there.
Do you offer any other services to franchisees?
We have a very strong franchise advisory council, 64 members, who meet quarterly and work with our Sonic corporate team to drive the brand and keep us relevant in today’s society. We're very engaged with our franchise owners on a quarterly basis to make sure the menu and marketing is right. Our franchisees do a lot to help each other, we're one big family.
Do you support charitable causes?
From a national basis we have a charitable initiative, Limeades for Learning®. We think education is important and teachers really need the support.
We ask teachers in the fall to submit a project for essential school supplies. During a voting campaign, we ask customers to vote for their favorite project and Sonic funds the top voted for projects throughout the US. On a local basis, our franchisees want to make sure they're doing what’s right for their local teachers and their communities.
Many work hard with high school and middle school parent-teacher organizations. Our Nashville franchisees annually sponsor a large golf tournament that raises funds for 50 scholarships that are awarded to worthy high school students. Sonic franchisees work together to do what’s right for their community.
Where is the menu today, from a customer standpoint? Healthy food? Fun food?
Customers come to us because of the experience. We have a very differentiated model. Carhops deliver food right to the stalls or patio and that becomes a unique dining experience for many of our patrons. With regards to our menu, we’ve evolved it through the years. We introduced a grilled chicken sandwich on a ciabatta bun that’s tasty and just 450 calories. We’ve also added a mini size to our shakes and slushes for our customers to couple with their favorite snacks like Mozzarella Sticks, Tots or Onion Rings. On our drink menu, there are well over 20,000 drink combinations that are less than 40 calories. We want to have choices for our customers. They can always customize their order on any menu item, take ingredients off, put them on. This is How We SONIC®.
What’s the time line on a build out on a franchise?
Once you contact us, then it takes us about three months of discussion for us to go through the process and for candidates to really understand Sonic. Then we have them talk to various franchisees to see what it takes and how the restaurants really operate. We send them out directly rather than hearing it just from us.
Then they come here to Oklahoma City, our corporate headquarters, and get to meet everyone on our staff who will work with them throughout their 20-year contract. They also get to see our new $1 million culinary kitchen for product development. Our candidates can take a look at our technology as we roll out our digitally interactive menu boards that really engage our customers. It's what we call “Discovery Day”.
Typically, they’re ready to go and we sign an agreement that they build their first restaurant within one year. We have real estate folks and construction to procure that. Closer to the opening the franchisee goes through our training department and we expose them to other grand openings so they can see what goes on. There's a lot of news and buzz. When you see our commercials, there's always pent-up demand. Usually it takes about a year for first locations and typically our candidates sign up for three to five locations because they want to build an organization.
Are there qualifications for opening up a franchise?
Yes. You need a capital outlay from half a million to $1 million in liquid assets, as well as a strong net worth. If you’re a restaurant operator now and want to run a Sonic, you partner with someone who has the financial capability and it seems to work really well. Most of those details can be found at sonicfranchises.com
What about the New York metropolitan area? Do you have any plans to move there?
We market all areas that are available for new franchise owners to look at. We have a successful business right now in North Babylon on Long Island. And, one of our franchisees just opened a new Sonic in Newark, New Jersey. We're also working on the inline concept so we can grow in urban markets, like Manhattan. We want to be within a 10-minute reach of all our customers.
Your ad campaign with the Two Guys in a car, represents Sonic how?
Pete and TJ represent the fun this SONIC experience is meant to be. We’ve been very happy with them. We just celebrated their 10th anniversary working with Sonic. We like what they do; it’s very Sonic-centric. We’re a fun brand, with great food and a unique restaurant experience everyone loves.