Franchisees Brian Moore (l.) and Steve Davis bought a company-owned McAlister's in Searcy, Ark., and will open a second unit later this year. Davis is one of four McAlister's franchisees with a connection to Mazzio's.

Within the past year, McAlister's has signed franchise agreements with four major groups to open restaurants in Virginia, Colorado, Arkansas and Texas. The quartet joins a half-dozen or so franchisees “into their teens in terms of restaurants,” says Phil Friedman, McAlister's chairman, president and chief executive officer.

Franchisees and franchisor say the strategy to go with seasoned operators, rather than single-unit franchisees, is a win-win situation. McAlister's, now at 267 units, benefits from the expertise these franchisees possess; there'll be minimal corporate hand-holding for site selection, hiring, training and other necessities.

“I like to have franchisees who have enough territories and capabilities to become companies in themselves,” Friedman says. “They can do a lot on their own; they become growth engines.”

According to franchisees, the partnership will allow them to expand with a brand that has staying power.

A remodel, which debuted last year, softens the interior; sales at remodeled stores have seen double-digit sales increases.

Three McAlister's franchisees will eventually share Virginia—albeit in separate designated market areas—a factor Miller says works in the concept's favor. Franchisees operating in close proximity is “a massive signal of faith to me that the economic model is good,” he says.

Courting proven franchisees is no easy feat, given the competitive landscape. “These guys have all the options in the world,” Friedman says of successful multiconcept and multiunit franchisees. “They're well-capitalized. They have their own little teams.”

“There's a lot of competition” among franchisors for such franchisees, agrees Dan Rowe, president of Fransmart, an Alexandria, Va.-based franchise consulting firm. But, Rowe adds, “there aren't that many great options for franchisees who want to build large multiunit companies.” McAlister's seven-figure unit volumes, plus its substantial dinner business, give the concept an edge over other sandwich chains, Rowe says.

McAlister's has made several adjustments both for growth's sake and to court such high-powered franchisees.

One major step for the 18-year-old concept is a redesign that softens and updates both the interior and exterior. Unveiled in July 2006, the redesign has boosted sales volume by double digits, says Patrick Walls, McAlister's senior vice president and chief franchise officer. So far, 22 new stores, built at a cost of about $650,000 each, feature the look, and five existing stores have been remodeled at a cost of $150,000 to $175,000 each.

Unit volumes rose 1 percent to 2 percent after McAlister’s launched a rigorous guest-satisfaction program, which includes both guest research and staff training.

Doing Dinner

Another significant change is the addition of dinner platters to the menu. Dinner already accounts for 35 percent of sales, Friedman says, but those are sandwich sales. To build checks and court more dinner customers, the chain has added a selection of platter meals, among them bone-in chicken and meatloaf. The platters, at $8.99 each, are responsible for improving comp-store sales 3 to 4 percent since their rollout last fall, Friedman says.

The focus on the menu is crucial to franchisees like Miller. “I am absolutely captivated by McAlister's food,” Miller says. “David [Groll, executive chef] has got fabulous enthusiasm for taste.” Groll, former corporate executive chef at Arby's, was involved in product development and testing of Arby's Market Fresh sandwich line.

Franchisee Steve Davis, who with business partner Brian Moore will develop stores in Arkansas, also says the menu is key. “I have seen a commitment not only to high-quality food but to menu development and enhancement,” says Davis, who left his post as senior vice president of operations at Mazzio's Corp. in June of 2007 to become a franchisee of Mazzio's, a Tulsa, Okla.-based pizza chain. Davis and Moore will acquire a company-owned McAlister's, then open their first unit later this year. They will continue as Mazzio's franchisees.

In a curious twist, Davis is one of four McAlister's franchisees with a connection to Mazzio's. Texas franchisee Kelly Saxton once owned and operated 34 Mazzio's; he sold them five years ago to focus on McAlister's. Former Mazzio's President Craig Bothwell now operates 12 McAlister's locations in Oklahoma and Kansas. Ridgeland, Miss.-based franchisee Tommy Johnsey operates both Mazzio's and McAlister's stores.

Last year McAlister’s cleared the menu board of some slow-selling sandwiches to make room for new dishes like the $7.39 Fiesta Chicken Salad.

Despite the experience of the new crop of multiconcept franchisees, McAlister's insists that franchisees progress slowly, allowing them to open only one restaurant their first year in the system.

Their reaction? “They look at us like we have three horns,” Walls says. Still, McAlister's insists on the conservative route. “The way we've grown is to be very conservative,” Walls says. “Everything we do, we go back to 'will this make franchisees more profitable, more successful?'”

Phil Friedman (r.), McAlister’s chairman, president and CEO, and Patrick Walls, senior vice president and chief franchise officer, say the competition for successful franchisees is fierce, and for good reason. “They are ready to go on Day One,” Walls says.

Miller understands the slow approach, but perhaps doesn't agree with it. “We can convince them we can open a little faster,” he says. He says his Arby's stores outperform the system; plus, “we invest heavily in our stores, in our people.”

Miller says he initially looked into becoming a franchisee of Jason's Deli, a Beaumont, Texas-based sandwich chain. Then he received a franchise flier from McAlister's in the mail and mentioned it to his 22-year-old daughter. “When my daughter said, 'Oh my God, McAlister's, that's fantastic,' that was interesting,” Miller says.