Restaurant Development & Design

FALL 2014

restaurant development + design is a user-driven resource for restaurant professionals charged with building new locations and remodeling existing units.

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1 0 • R E S T A U R A N T D E V E L O P M E N T + D E S I G N • F A L L 2 0 1 4 Tropical Smoothie Café to Finance Franchisees BUZZ who's doing what Armed with $20 million in BIP Capital private equity funds, Tropical Smoothie Café has launched a direct fnancing program to help existing franchisees open more restaurants. The company has so far approved $2.4 million in direct fnancing and as of late September had applications outstanding on loan requests totaling $3.4 million. In June, the frst two cafés opened under the new program, one in Melbourne, Fla., and the other in Syosset, N.Y. Qualifed existing franchisees with good credit are eligible for fve-year, fxed-rate loans to cover 80 percent of store development costs, including fran- chise fees, equipment, signage and other expenses related to opening. The chain's initial investment ranges from $166,000 to $414,000. Tropical Smoothie Café CEO Mike Rotondo says consumer demand for the brand is high and same-store sales have increased signifcantly, creating a strong environment for franchisee expansion. "This is a solution for our franchisees who want to expand their businesses but fnd it diffcult to acquire loans through traditional means," he says. Last year, Tropical Smoothie Café opened 40 restaurants and reported a 6.4 percent increase in same-store sales. Through July 2014, the 385-unit chain is reporting a 9.2 percent increase in same-store sales and expects to open 70 new locations by year's end.

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