Pals start Creole & Cajun sandwich shops that now take in
$1 million a year.

When Charlie Youngs found himself unemployed in 1990, the out-of-work construction engineer decided he could make a better living serving up po’ boy sandwiches and gumbo.

At a beachside bar over several beers, the Louisiana native told his neighbor and good friend Jon Sweede about his dream of opening a chain of po’ boy shops in Florida that would serve some of the same Creole and Cajun delicacies that he had grown up eating at home.

Sweede, who spent two years waiting tables, washing dishes and managing several seafood restaurants in Siesta Key, Florida, didn’t know a thing about Creole or Cajun cuisine, or that there was a difference between the two. But he was immediately convinced the concept would work. Great intuition!

“I didn’t know what Creole was,” Sweede said, “but I knew no one in the nation was doing that at a national level in a moderate price range,” he said.

The two decided to devise a business plan. It began in the heart of New Orleans where Youngs and Sweede spent weeks sampling the most authentic Creole and Cajun cuisine the city had to offer. The trip paid off.

Sweede soon learned that Cajun cuisine was spicy fare that originated in Louisiana’s countryside. Creole cuisine, traditionally infused with herbs, was inspired by a blending of Spanish, American, African, German, and Italian flavors that were all present in New Orleans during the 1700s.

Eighteen month later, Youngs’ and Sweede’s business plan was put in writing. Po’ Boys Creole Café would serve traditional Creole and Cajun fare, including gumbo, jambalaya, crawfish, red beans and rice, specialty Louisiana beers and their namesake, po’ boy sandwiches.

But their concept would break the mold of traditional Creole-style eateries by offering mainstream foods such as wraps, salads and sandwiches, all served at a reasonable price in a sports bar atmosphere. The restaurant would feature a full-service Sunday brunch serving eggs benedict, Bananas Foster, waffles and beignets, said the duo.

The atmosphere of the restaurant would be distinctly New Orleans. Photographs of landmarks in the Big Easy and Mardi Gras memorabilia would adorn the walls. Po’ Boys Creole Café would earn a reputation for serving up good food and good times by hosting Mardi Gras bashes, crawfish festivals and Fat Tuesday celebrations.

“Our deal was to have a place where we would have fun,” Youngs said. “We wanted a place where we would enjoy hanging out.” But neither Youngs nor Sweede had the money to open the casual Creole-style cafe that looked so lucrative. But Sweede knew someone who did. Sweede and a high school buddy, Carmen Calabrese, had made a pact as teenagers to open a restaurant together. Their goal was to make it happen before they turned 30.

At their 10-year high school reunion, Sweede presented Calabrese with the business plan he and Youngs had cobbled together.

A general manager of a Chili’s, Calabrese had the financial resources and the restaurant management experience that Sweede and Youngs did not. He immediately resigned his position at Chili’s and joined Youngs’ and Sweede’s business venture. The team was set.

With $17,000, they opened their first 24-seat restaurant in Tallahas-see, Florida, in 1992. It sat only blocks away from Florida State University. A great location!

For a year, Youngs, Sweede, Calabrese and a fourth friend (who is no longer a business partner) ran the restaurant without any staff. “We each worked 117 hours a week,” Sweede said. The back-breaking hours paid off. After a year in business, the partners turned enough of a profit to open a second location in downtown Tallahassee.

Since then, Po’ Boys Creole Café has grown into a six-unit chain that continues to build a presence in Florida. Tallahassee has two 2,500-square-foot stores, which gross $1.5 million each. Five franchise locations operate in Gainesville, Tampa, Brandon, Jacksonville and Orlando. Thirteen years later, the three business partners remain the best of friends. “I always said if this business ever got between us, I would sell it and keep the friendship,” Sweede said.

The Franchise Program

When Charlie Youngs decided to franchise Po’ Boys Creole Café, he designed a franchising program that would help put more money in the pockets of franchisees who invested in the New Orleans-themed restaurant chain. It’s paying off.

As corporate parents, Youngs and partners Carmen Calabrese and Jon Sweede agreed the best way to lure franchise holders to their concept would be to give them every opportunity to boost earnings during their first year in business.

The franchisers implemented a flat fee royalty schedule that charges franchise owners a flat weekly service fee instead of a percentage of their gross revenue. Po’ Boys’ royalty schedule charges new franchisees a lump sum of $500 a week until they surpass $800,000 in gross revenue within a 12-month period.

The franchisees’ service fees increase to $600 a week if they earn $800,000 to $1 million in gross revenue within a year. Franchises that gross $1 million to $1.2 million a year pay $700 a week in service fees. The royalty fee rises to $800 per week if franchisees take in $1.2 to $1.4 million within the year. Franchised units that earn $1.4 to $1.6 million in gross revenue pay $900 a week in fees. Franchisees earning more than $1.6 million of gross revenue will pay a weekly sum of $900 and an extra $100 for every $200,000 of gross revenue the restaurant earns above $1.6 million.

“We want our franchisees to do well,” said Youngs, the director of franchise development. “This encourages our franchise owners to increase their business in order to increase their profits. The more they make the first year, the more they put in their pocket.”

While the flat fee royalty schedule is designed to strengthen bases for new franchisees, most Po’ Boys franchisees typically pay less in royalties than the five percent industry standard, says the franchisor.
“The first year is the year the franchisees can really kick it,” Youngs said. “But even with the increases, we’re hovering around three percent, which is pretty low. This probably is one of the biggest selling points for our franchisees.”

Besides increasing their earning potential, the flat fee royalty schedule allows for easy cash flow management for franchisees.

“It all has to do with ease of calculating,” Youngs said. “The franchisees know how much money will come out each week, and it’s an automatic withdrawal from each franchisee’s bank account.”


Taken from WEB