Article Source: Franchise Times
Winner: Freddy’s Frozen Custard & Steakburgers
Freddy’s Frozen Custard & Steakburgers takes pride in its franchisees, many of which own multiple units. “The relationships that the franchisee has with Freddy’s corporate is unlike anything I’ve been involved with or that I’ve seen out there,” said Ron Oberg, a 21-unit franchisee with restaurants in six states.
Oberg’s been involved with Quiznos, Best Western and Perkins. He was the first Freddy’s franchisee about 20 years ago. Even through leadership changes, Oberg said the corporate team is always accessible.
Private equity firm Thompson Street Capital Partners bought Freddy’s from its founders in 2021. Scott Redler and brothers Bill and Randy Simon opened the first Freddy’s restaurant in Wichita, Kansas, in August 2002, and last year the company opened a new training and innovation center in that city.
Today, Freddy’s is on its way to $1 billion. It ended 2024 with 553 restaurants and roughly $988 million in systemwide sales. The winner in the Quick Flip category, which examined quick-service burger franchises, Freddy’s stood out for its return-on-investment potential, strong pace of openings and detailed financial information provided in its franchise disclosure document.
Oberg said Freddy’s takes a strategic, careful approach to bringing in new operators. “They’re bringing in franchisees that have multiple concepts, whether they are a Zaxby’s franchisee or a former Burger King franchisee. They’re really bringing in franchisees that have been involved in the QSR or restaurant industry,” he said. “Everybody would like to own a restaurant, but not everybody can do it, no matter how much money you have.”
An experienced Quiznos franchisee at the time, Oberg knew he wanted to get into a new brand in the early aughts. A Wichita resident, he frequented Freddy’s after his kids’ sporting events. The menu was the star of the show.
“I realized very quickly that it was just not a typical burger joint,” he said. The service was top notch, too; he noticed employees coming into the dining room to talk to customers and bus tables.
Oberg knew exactly where he wanted to open his own Freddy’s in Hutchinson, Kansas, and met with Redler to see if the company was going to franchise. He signed a four-unit deal in April 2004, broke ground in August and opened for business in December. That quick turnaround would be almost impossible today, Oberg noted. “I can barely find land and close on it in that amount of time,” he said.
When Freddy’s brought in a new PE owner four years ago, Oberg said the company conducted focus groups with franchisees to see what was working and what needed improvement. The brand nixed menu items that didn’t sell and revamped what was left.
Technology was another focus, he said. Back-of-house innovation has been a success for Oberg’s stores. For instance, Freddy’s added a machine that “perfectly smashes” its burger patties. “Whether it’s the first burger of the day or the last burger of the day, everything is consistent,” he said.
For his stores that employ a lot of cooks who speak English as a second language, he touted the company’s soon-to-be-implemented visual kitchen display system that shows how to make each product.
“Instead of reading the English, they can see it, as far as how to build that burger,” he said. “It’s a lot easier to read, eliminate mistakes and also it speeds up the cook time.”
Over two decades, he’s developed lower-level employees into company executives. Oberg
attributes much of his success to his dedicated team members. “We’ve been able to find great employees that are willing to grow with us and we’ve seen that across the board,” Oberg said. “We have managers that are celebrating 10, 15 years with our company. We’ve been very fortunate in that respect.”
A bit further south, JJ Ramsey of Ram-Z Restaurant Group owns 33 Freddy’s units in Oklahoma, Texas and Ohio. He first learned of Freddy’s when his son ordered from there via DoorDash. “I see that they’re growing and it’s a great brand. I started eating there. I loved the product,” Ramsey said. “Then, the rest is history.”
Ram-Z’s store managers have freedom to run the restaurants in terms of day-to-day duties, but the franchisee group establishes clear goals so everyone is on the same page. “I’m not going to micromanage their daily schedules. I’m not going to force them to work ungodly hours,” Ramsey said.
Like Oberg, Ramsey noted the company’s dedication to supporting its franchisees. Corporate participation in grand openings and other events is more than welcomed, he said.
“A lot of people don’t want corporate in their restaurants. They’re challenging them on things, they want to be left alone. I don’t, so we encourage it,” he said. “Everything they said they would do, they have done. Whether it’s phone calls or visits or text messages from the executives, or the CEO being at your restaurant on opening day … the support has been fantastic.”
Much of Ram-Z’s growth over the years came from acquiring existing restaurants—many of them lower-performing locations. “As far as meeting my goal of being at system AUV, I am not at that,” Ramsey said. Freddy’s average unit volume is about $1.8 million. “But that takes time. It takes 18 to 24 months to achieve that sales growth. What I will say is I’m happy with the results so far.”