Cheba Hut experienced major growth in 2018, both in terms of new stores opened and internal company growth, and has put processes in place that will help the brand hit the ground running in 2019.
Year-to-date, the company has opened two locations and will open three more by the end of 2018. Three of those stores will be company-owned and two will be franchise locations, according to Cheba Hut Chief Operating Officer Marc Torres. The brand will also open four new company stores in 2019 and is looking to open six to eight new franchise locations, Torres said. Cheba Hut currently has 24 open locations.
The company opened another location in the Phoenix area at the Ahwatukee Foothills Towne Center with an existing franchisee in 2018. Cheba Hut also opened a new company-owned store in Las Vegas - the second one in that city - and will open a third company-owned Las Vegas store around December of 2018.
Cheba Hut will open another Denver company-owned location by the end of 2018, which will be located in the neighborhood of Stapleton. An existing franchisee in Albuquerque, New Mexico will open their second location in the western part of the city. The brand will also onboard more franchise groups by the end of 2018 and wants to bring on six to eight new franchise partners.
In a major win for the brand, Cheba Hut recently on-boarded a new franchisee for an upcoming location in Riverside, California. That franchisee signed a three-unit deal for the so-called Inland Empire area, which covers the cities of Riverside, San Bernardino and Temecula, Torres said. The Riverside location is expected to open in the spring of 2019.
“It’s been an incredibly exciting year for Cheba Hut,” Torres said. “Just the success we’ve seen with existing franchisees and their desire to expand and open more units has been so validating. It proves that our model can work in any market and that working hard to find the right cultural fit can go a long way.”
The company also had some internal changes.
“At the beginning of the year we outsourced our delivery program, which allowed us to focus on our other programs, mainly our bar program and our catering program,” Torres said. “We’ve also adopted a new restaurant management software called Restaurant365 that we’re currently testing in our company stores. It’s a total accounting and restaurant management software that we’re rolling out in our company stores and doing all the testing and dialing operations component of it before we take it to the franchise community.”
And that’s not the only financial change that’s been made this past year.
“We brought accounting in-house and hired a controller,” Torres said. “They’ve done a great job of really helping us dial in our company store financials. We’ve taken a lot of those best practices and applied them at the franchise level as well.”
By the end of the year, Cheba also plans to hire a marketing director.
One of Cheba Hut’s major goals in 2019 is to streamline store design and construction. The brand has determined what functionally works best for Cheba Hut, and they are trying to pair that with the overall look and feel of each location so that each store doesn’t have a cookie-cutter feel to it, Torres said. To that end, the brand now offers each franchisee three to five different designs to choose from for their location, which helps them stay within brand standards while also keeping their individuality.
“We want every store to be unique and different,” Torres said. “We’ve been spending a lot of time putting together design packages that allow our franchisees to be flexible with appearances, especially as they do multiple locations in the same market.”
As the brand gets larger and expands, the corporate team will make sure no one loses sight of what makes Cheba Hut such a great concept to be part of. The brand will be selective of the franchise partners it brings on, and the corporate team remains dedicated to the success of its franchisees and making sure they have the tools they need to put their best foot forward as they open their stores and get started on their journeys with Cheba Hut, Torres said.
“We are dedicated to maintaining our franchise family, so we’ll continue to keep our bar set very high for our prospective franchisees,” Torres said. “We’ve turned down two franchise groups in the last three weeks who wanted to do multi-store deals because it didn’t make sense culture-wise. Maintaining a cultural fit and keeping the bar set very high for our franchisees is something we take seriously. You don’t just get to come in and buy a Cheba Hut. We want it to be a bigger decision, and one that is culturally impactful for the franchisee and for us.”
The startup costs of a Cheba Hut franchise range from $336,000 to $678,000. The franchise fee is $40,000. For more information about franchising with Cheba Hut, visit http://franchise.chebahut.com/.