SmartCompany50 rank: 7
Revenue: $17.7 million
Growth: 105%
Founders: Katherine Sampson, 41
Based: Melbourne
Employees: 10 at head office, 200 at franchise stores
Industry: Retail trade
Website: www.healthyhabits.com.au
Three years ago Katherine Sampson (right) was a single woman with two kids when she took the humble sandwich bar and turned it into a franchise chain with 26 franchisees.
Sampson owned four successful sandwich bars in food courts, and could see a huge opportunity to create a national brand on the health food market. Again sandwiches are a cottage industry with 442 million sandwiches sold in Australia, 93% by independent operators.
While the business trend is in healthy food, Sampson twisted that and focused on making consumers feel good about themselves. The idea was to create a fun, cheeky personality that delivers healthy food options and makes people feel good about the experience so they return.
The start up costs were high and the business was very difficult to support, being reliant on Sampson’s personal assets. She was a single mum and had great trouble securing finance. She also had huge trouble getting prize locations at shopping centres despite her previous business success as a sandwich bar operator.
She also faced a Catch 22: the growth depended on getting franchises but she could not attract them without growth. She decided to finance new stores personally to quickly create the brand that would give Healthy Habits leverage with leasing agents and snare her prize sites. It worked, and stores are now located in Queensland, Victoria, NSW and SA in prime highly visible shopping centres.
“I learnt to ask for help: you’ll be surprised who is prepared to stand up and support you. I also learnt to collect smart people around me and use their expertise and to be around positive thinkers,” she says.
Sampson is now extending the brand into regional areas and to mass transit sites and has just opened a store at Melbourne Airport. She is also working on a quick-to-market model of franchise so Healthy Habits is viable in more locations. Sampson says between 90%-94% of franchises are profitable.
But challenges lie ahead. Sampson says the retail health market is becoming more competitive with new players emerging alongside the fast food giants who are trying to reposition the brand to take advantage of healthy trends. “Our brand strategy of making consumers feel good about themselves gives us an advantage over other brands.”
The other problem she is facing is that the franchise market may be close to saturation. “This means only the highest achieving brands will attract quality franchisees so our level of service to franchisees has to be world’s best practice.”
Key success factors:
- Take a risk and financially back yourself in order to grow faster.
- As the franchise market hits saturation make sure the service to franchises is excellent.
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