The lunch bunch: 5 top healthy food franchises
As Aussies continue to seek healthy options for their midday munchies there is no shortage of independent cafes and chains to offer menu options that feed their demands.
For the lunchtime trade in particular, the sandwich has been a mainstay for years with Subway a runaway leader in terms of market share for this space.
But salads and sushi have made their mark in the sector and helped shift the focus to a healthier menu.
IBISWorld analyst Bao Vuong wrote in the December 2017 report, ‘Fast Food and Takeaway Food Services’, that healthy eating has transformed the industry over the past five years.
“Australians have become increasingly health conscious due to public campaigns discouraging unhealthy lifestyles. Healthier eating options have increasingly entered the industry, including salad and juice bars, and sushi stores. These new fast food options were initially viewed as passing fads. However, over time these new retailers have cemented their places in the fast food market. This has increased competition in an already saturated and competitive market.”
According to Vuong, increased health consciousness among consumers has been matched by other businesses in the food arena broadening their offer to cater for hungry customers – cafes and restaurants, convenience stores and supermarkets have all freshened up their meal options.
“Ongoing strong demand for quick and healthy food options is anticipated to continue bolstering the industry over the next five years,” Vuong writes in the August 2018 report, ‘Sandwich Shops in Australia’. “The industry’s external competition is projected to continue rising over the period, as other quick-service food establishments provide premium healthy options, such as gourmet sandwiches. Cafes, supermarket chains and convenience stores are also forecast to increasingly provide readymade healthy meals, which is likely to constrain industry growth.”
So what are the brands fuelling the lunch-rush?
One franchise brand has in four years achieved incredible growth. Soul Origin launched its first franchise in June 2014, just a year after opening its second corporate outlet. In mid September it celebrated its 100th store, an outlet at a suburban shopping centre, Royal Randwick, in Sydney’s eastern suburbs.
Chris Mavris is the CEO for the healthy eating food chain and he’s confident that Australians are looking for food they know and understand – the staples.
“From research we’ve done, consumers talk about lunchtime regret. Some of the food [in stores] looks really good but it doesn’t live up to expectation,” he says. And in a lunch hour, there’s really no time to go back and fix it with a different meal, he points out.
Soul Origin provides customers with everyday classics with a twist, fresh wholesome food with global flavours, he says.
“Aussies are making better choices. The menus of all the big franchise brands are putting on salads, they are looking at healthier products, more nutritious dishes.
“The palate is amazing, and with the mixing bowl of cultures we have in Australia we can appreciate flavours.”
Luke Baylis made headlines last year with his move to ditch food courts in favour of new locations to dish up healthy meals. In his battle with landlords over rents, the head of SumoSalad took drastic action, putting the business into voluntary administration in July this year.
Now Baylis is back in charge at the healthy fast food chain.
“We’ve had a full bill of health. The team have been incredibly supportive, they are very passionate. It’s been a tough time but it’s been incredibly positive and a fresh start for us,” Baylis told Inside Franchise Business. “We’ve had legacy issues, this gives our business the ability to remove those legacy issues and create a really strong platform that doesn’t divert us from moving the business forward.”
A vocal naysayer of the food court model, Baylis has been working on taking the business into other arenas. “As one business model gets disrupted, you have to shoot a few test shots out. One of the things that’s worked incredibly well is the wellness cafe. It’s providing people seeking healthier food opportunities with breakfast, lunch and dinner options in an upmarket manner. It’s very strong,” said Baylis.
Sumo has been trialling wellness cafes to good effect – Baylis reports a 261 per cent growth on the food court model.
“Such a huge improved turnover line makes this a very viable model, which we’ve refined over the last 24 months.”
Kim Toovey sees a challenging economic period ahead aligned with a national doom and gloom, and lack of financial growth. “People are seeing less money in their pockets and are being thrifty,” he says. As a result, some people are choosing the home-cooked lunch option, diminishing the takeaway market’s potential, says the Suki Sushi Burrito franchisor.
Meanwhile the health conscious consumer might be a signed-up supporter of the meal prep revolution, attracted by the ease of a controlled healthy meal ready to hand, and driven by fitness regimes.
“More and more people are eating healthily so for us it’s been about staying relevant. You have to listen to customers, have your ear to the ground but stay true to the brand.”
Suki Sushi Burrito, as the name suggests, puts the healthy appeal of sushi with the temptation of hearty burritos. It is also trialling acai bowls as an add-on.
“It’s about having amazing tasting food at a good price.”
As a food retailer the challenge is to continue to achieve that and retain margins when everything is going up, and this is crucial for a franchisor. Toovey believes the secret is a great relationship with suppliers so any pain points that arise from ingredient shortages or increased costs can be dealt with early.
“We have the attitude of remaining fair – a lot about rebates, we’re a growing brand, we want to have a fair and open relationship with franchisees. At the moment it’s all about getting the best price because we want them to buy a second or third location, and not just a money grab.”
Sandwich Chefs is a little different. It’s a carvery in a sandwich deli. The chain is growing steadily, not least because the focus is achieving a return on investment (ROI) for the incoming franchisees, explains Gary Powell, national network development manager.
“We’ve just knocked back a high profile site in Melbourne because it doesn’t meet our selection criteria,” he says. “We calculate an ROI; we had confidence it would provide revenue but not ROI for the franchisee and that’s our primary focus.
“It’s about franchise viability. The site would be fantastic for our brand but that’s not the game we’re in; we’re in the game of long-term.”
Powell says outsourcing the majority of the leasing means the process is handled by experts who understand the market and the demands of the franchisor.
Sandwich Chefs has refreshed its look, and the New York deli style is putting the brand in a premium position, reports Ollie Mann, who heads up marketing for the chain.
“Sandwiches as a quick service restaurant option is a pretty forgotten segment. There’s an opportunity for us. We don’t have anyone operating in this carvery, specialty space.”
Yes, the customer profile is skewed 60/40 male tradies to female shoppers. But he believes there’s a universal appeal. Who can’t resist a slow roast that’s at the core of the offer? While the 14-hour slow cooked pork with amazing crackling might be a meat-lovers’ favourite, the chain isn’t catering purely for carnivores. The Mediterranean roast veggie roll is reportedly one of its most popular sandwiches. Also on the menu are gourmet salads, an expanding category, and freshly squeezed juices. There is something for everyone, but pitched as quality, Mann says.
Subway claims to be the largest quick service restaurant (QSR) in Australia, with more than 1300 restaurants around the country. For a brand with such a strong market share (85 per cent in sandwiches), there’s always the temptation to keep doing what works and ignore opportunities to innovate. But the team at Subway has embraced change, this year rolling out a revitalised menu and restaurant design.
Kate Brody, Subway director of marketing, Australia and New Zealand, says, “Our new menu and restaurant decor is a part of our 360 degree brand refresh. We are introducing bolder flavours and new ingredients that respond to what Subway guests have told us they want from us – fresh, healthy, delicious and locally sourced food that is affordable and convenient.”
This is the brand’s “Fresh Forward” approach designed to transform every element of the customer’s instore experience.
“Our first Australian restaurant featuring the new decor opened its doors and drive-through in Toowoomba on Wednesday 13 June this year, and we plan to expand this new decor across all Australian and New Zealand restaurants.”
Brody reveals more than 100 restaurants across Australia and New Zealand are piloting a rejuvenated menu featuring 25 new ingredients, including new and improved breads, meats, cheeses, salads, sauces and seasoning options.