Want to buy a dessert business with a feel-good factor?

By Sarah Stowe | 01 Aug 2016 View comments

Chocolate-loving customers want to know where ingredients are sourced. Image: San ChurroSweet temptation is at the heart of this dessert franchise and yet there is more to Chocolateria San Churro than its smooth Spanish chocolate.

“More than ever our customers want to know where the product comes from,” says franchisor Giro Mauricci.

There’s an increasing appetite for knowledge; the customer wants to know ‘why I should feel good about the product’.

So at San Churro, this achieved through simple transparency about the source and supply chain.

“It’s telling people the story, making a huge song and dance about something we’ve taken for granted,” says Mauricci. “Our beans are Fairtrade, and we know the farmers in PNG. This might not be at the forefront of the decision making process but it is an important element.”

When it comes to the menu, looking beyond the brand classics is important.

“Food is very much like fashion: overseas influence, media, and customer tastes. We’re all connected via Instagram and Facebook. Food is so visual, we love to share, and talk about what we’re eating.

“We’re lucky we’re not selling a commodity, we’re selling a treat. People can have a bit of fun on social media.”

The best ideas come from a range of places – customers are very passionate and send ideas, he says.

San Churro can judge the potential of a trialled idea through the activity on social media.

The social media model is structured around a company brand page, with each franchisee operating his or her own page. This allows the brand to test new concepts at individual stores and gauge the reception by monitoring the social media response.

It’s a decentralised process.

Today’s menu is quite different from the menu served up two to three years ago – 20 to 30 percent is new, says Mauricci, and the business is focusing on increasing the number of new items.

“Last year was the year of Nutella. This year we’re seeing a consciousness about functionality – things like coconut and agave syrup, dairy free options which we’ve been looking at. There’s more interest in alternatives.”

There’s a balance though: overcomplexity does no favours to the franchisee, he suggests.

If you buy a franchise

So what does the San Churro franchise offer franchisees?

“We’re heavily invested in support. We have four business development managers across 50 stores. We have an eco-system of suppliers feeding us their best ideas each week. We have six in our marketing team.”

A new customer loyalty system and business intelligence are things franchisees appreciate, says Mauricci.

“We use our size to achieve economies, something that is more problematic for smaller systems. The leverage we have compared to the mum and dad stores trying to negotiate, we’ve got that on our side. We have a pretty good relationship with landlords, and understand what a likely turnover is going to be, we’re quite comfortable with that.

“We do have the benefit of understanding affordability of potential sites.

“The more sophisticated landlords understand the need to step up their game in dining precincts. Westfield in particular in Miranda and Kotara,” says Mauricci.

 “We make hefty investments in longevity. We’re run by the founder and some partners, not private equity, so we’re driven by doing the right thing by the franchisees.”