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PLANO, Texas – At the end of October, the co-founder of the Mooyah better burger concept, Rich Hicks, sent notice (pdf) to the system's quick service restaurant owners, informing them that Mooyah and the firm's new CEO Bill Spae were parting ways. Hicks immediately took over as the franchising company's interim CEO and announced that the firm would begin looking for a permanent CEO.
Spae had been hired by the burger chain of now 54 franchises just ten months earlier. He came to Mooyah from the position of chief operating officer of Cici's Pizza, with its 512 franchised units.
Mooyah is characterized by single-unit franchise owners and a few area representatives, which the company calls development agents. Area representatives sign an area contract with a franchisor to sell franchises in an area for a fee and/or support franchisees in return for a part of their royalties.
Former CEO Bill Spae answered several questions earlier this month about his sudden departure. Mr. Hicks' answered questions from Blue MauMau about that event and how his chain is doing by email.
Blue MauMau: Why did you and Bill Spae come to the conclusion that he needed to go and you had to come back to lead the company? If there was a difference of opinion over strategy, was it about whether Mooyah should continue to have development agents [area representatives]?
Rich Hicks: I have known Bill for a long time and have learned a lot from Bill as well as from my own experiences in building companies. We parted ways on friendly terms and still maintain a personal relationship.
BMM: You are now interim CEO. What sort of permanent CEO do you want to lead the company? What do you want the Mooyah of the future to look like under his or her direction and leadership?
Hicks: Our brand is well positioned for continued growth with strong commitment to our franchise operators and our guests. The strength of any company, ours included, besides having an incredible product, are the people. We are always looking to strengthen our human capital, whether it be corporate support staff or franchise operators.
BMM: I am hearing that growth has slowed considerably for better burger chains from their explosive growth a few years ago. What's your sense on what is happening in the better burger market?
Hicks: Consumers have unlimited choices for dining out and where they spend their time and money. MOOYAH is very contagious and our guests love the experience. Franchise candidates also have unlimited choices for what franchise brand they pick. The space is crowded, but we are confident that we will attract people who want to make a difference, be part of the MOOYAH experience and stand out in this space.
BMM: Your system is still pretty new, founded in 2007 with now 54 restaurants, spread thinly through a lot of states. We are hearing anecdotal stories that Mooyah franchisees are taking a long time to break even. What are you doing to shorten that?
Hicks: We are deeply focused on supporting our franchise operators with strong operational and marketing initiatives. We are always looking at ways to improve and strengthen our business model, training programs and local store marketing promotions to attract more guests to our restaurants.
BMM: How much does an average Mooyah store make in revenue and operating profits in the first year and three years out?
Hicks: We are currently in the process of working on our Item 19* and not able to comment on restaurant financial performance at this time.
*Editor's note: Franchisors are required by the Federal Trade Commission to complete and provide to prospective franchise buyers an unaudited franchise disclosure document of 23 items ranging from bankruptcy history to financial information. Franchisors may choose to disclose in Item 19, which is entitled "Financial Performance Representations," how much revenue or profit franchise units earn. According to franchise researcher Bond Publishing, almost half of franchisors now include some sort of financial unit performance data in Item 19 to help buyers understand how much an average franchise earns. As of its April Franchise Disclosure Document, Mooyah has chosen not to disclose any historical earnings of company-owned or franchised restaurants to prospective franchise buyers.