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How Modern Market Combines Impressive Margins with Innovative Restaurant Operations to Engineer a Game-Changing, $2.2 Million AUV Franchise Opportunity in 2024

With a diverse, chef-inspired menu and a double-sided production line, Modern Market achieves fast casual quality at QSR speeds — a feat very few competitors have achieved.

By Luca Piacentini1851 Franchise Managing Editor
SPONSOREDUpdated 9:09AM 03/05/24

In the $209 billion world of fast casual dining, standing out is no small feat. Yet, Modern Market Eatery, a restaurant franchise that has woven innovation, health and sustainability into its core, is doing just that. How? By focusing on not only what we eat, but also how it's prepared and delivered, prioritizing both the needs of the modern diner and the modern franchise operator. The result? A fast casual franchise opportunity up-to-par with any of the household-name QSR giants. 

"In our quest to redefine fast food, our vision at Modern Market is clear: make real food the new standard,” said President and Co-founder Rob McColgan. “Over more than a decade, we've honed our processes to ensure that scratch cooking is fast, repeatable and profitable. We don’t come from traditional restaurant experience, which has allowed us to reinvent the concept from the ground up. Now, we’re inviting others to help us disrupt the fast casual industry."

From Wall Street to Main Street: The Birth of a Unique Concept

McColgan’s background is as unique as the brand he represents. A former trading and investment management expert with Goldman Sachs, McColgan’s foray into the restaurant industry was driven primarily by personal experience. 

“During my career in finance, I maintained close contact with my high school best friend, who was engaged in engineering work in California,” said McColgan. “We had always talked about collaborating on a project together, but it had to be something we were passionate about personally. He consulted for major restaurant companies, and we often discussed the stark contrast between the U.S. fast food culture and dining experiences abroad. We frequently dined at local, healthy bistros and cafes, leading us to ponder: what would our ideal everyday restaurant look like?”

So McColgan and his best friend, Anthony Pigliacamposet out to find that answer. In 2008, they left their respective jobs and raised capital to establish the first Modern Market. 

“With our busy schedules, we craved a dining option that was not only healthy and made with clean ingredients but also made us feel good post-meal,” said McColgan. “As athletes, we viewed food as fuel, necessitating both exceptional taste and a diverse menu. This philosophy shaped our initial offerings, which included an array of choices from pizzas to salads."

The flagship Modern Market restaurant opened in Boulder, Colorado, in 2009. The brand experienced consistent growth over the next decade, with company-owned operations opening up in Colorado, Texas and Arizona. But when the COVID-19 pandemic hit in 2020, McColgan said it was clear that the brand had to adapt.

“We leaned heavily into delivery and digital ordering,” said McColgan. “Modern life makes eating out or ordering online a necessity. This shift towards online transactions has fundamentally transformed our business model and it allowed us to really focus on our growth trajectory. Today, we have a tech stack on par with the most sophisticated retailers and are miles ahead of the largest restaurant brands.” 

Currently, Modern Market operates 31 restaurants across the country. The brand is owned by parent company Modern Restaurant Concepts, which also owns the fast casual brand Qdoba. This makes Modern Market an emerging franchise with the buying power of an 800-unit chain — a rare blend that provides franchise partners with better pricing and logistics for accessing top-of-the-line equipment and food costs. 

The Franchise Advantage: Combining The Profits and Operational Speed of QSRs with the Quality of Fast Casual

While McColgan and his team always envisioned Modern Market Eatery as a franchise, they knew they would need to perfect the concept before becoming “franchise ready.” The brand’s expansion has primarily been company-fueled up until now, but the pandemic provided clarity on how to refine their model for franchising success. Armed with this experience, Modern Market launched its franchising program in 2021, signing its first franchise agreement for 41 units with Thrive Restaurant Group, who happen to be major Applebee’s operators.

Now, with a new-and-improved business model, McColgan says the team is set to light the franchise world ablaze.

"Our chef-inspired menu stands out in the 'better-for-you' fast casual sector, distinguished not just by its quality, but also by its extensive range,” McColgan said. “Offering a variety that spans salads, sandwiches, bowls and even pizzas, and including catering services, it appeals to a diverse clientele, from families to coworkers.”

When it comes to food, Modern Market's commitment to sustainability and quality further sets it apart. "We deliver plant-based options and scratch-made, sustainable food," said McColgan, underlining the brand's commitment to both environmental responsibility and operational efficiency. “By working directly with some of the best suppliers in the world, we are able to deliver these products to our restaurants anywhere in the country at competitive prices.”

Another key operational differentiator is the efficiency of the brand’s double-sided production line, which allows staff to efficiently and quickly prepare orders thanks to a highly choreographed integration of kitchen processes — scratch-cooking at QSR speed.  

“Much of this development stemmed from the growth of our off-premise channels. We needed a solution that could handle our diverse menu without compromising the dine-in experience, and our current system achieves this with exceptional throughput,” said McColgan. “Our streamlined kitchen model enables us to create a broad menu with made-to-order dishes that deploy in three to five minutes. Staff are also trained in multiple areas of the kitchen, which keeps labor costs down.”

This efficiency even facilitated the introduction of a drive-thru model, with Modern Market recently opening its first-ever drive-thru location in Colorado Springs late last year. 

“This is really a feature unique to our brand given the quality and variety of our food — not many fast casual brands can match our throughput in a traditional drive-thru model,” said McColgan. “Looking ahead, not all our locations will feature a drive-thru, but where it's viable, we're equipped to execute it effectively."

Similarly, the flexibility in Modern Market’s real estate requirements is another key advantage for franchisees. 

“We can efficiently operate in as little as 2,300-square-feet., and this model has proven to be highly successful,” said McColgan. “Our approach is strategic: if the location and rent align with our criteria, we're ready to seize the opportunity and expand our presence. For operators, smaller spaces means they don’t have to worry about occupancy costs dominating their P&L.”

All of these factors explain why the 18 company-owned Modern Market locations open for the calendar year of 2023 saw an impressive AUV of $2.2 million, according to the brand’s most recent FDD,* with the initial investment range between $928,500 and $1,468,750.

A Focus on Future Expansion

Looking ahead, Modern Market’s plans are ambitious yet strategic, focusing on partnering with experienced operators in diverse markets. This year, the team plans to open between eight and 10 new restaurants. 

“In terms of our broader strategy, we aim to fully embrace the franchise model, collaborating with exceptional operators who have expertise in their local markets to expand Modern Market's presence nationwide,” said McColgan. “We want to partner with passionate and experienced restaurant operators who believe in our brand and recognize our leading position in this category.”

Although some restaurant experience is required, McColgan says all incoming franchise partners will benefit from in-depth training programs, site selection support, innovative chef-driven menus, technology integrations and strong field and marketing support.

"At the end of the day, the quality of our food, the breadth of our menu and our advanced production capabilities make us a unique investment opportunity," McColgan said. “Times are changing. With the help of passionate and qualified franchisees, Modern Market is ready to usher in a whole new era of fast casual dining.”

*More details are available in our Franchise Disclosure Document (FDD).