Chain Innovators: Menchies

Published on Friday, July 01, 2011

Written by Dana Tanyeri and Lisa White

A dual focus on product innovation and delivering a customer service experience that leaves guests smiling is fast putting Menchie's on the map — the entire map. From just three units in 2008, the company expects to pass the 200-store mark this year. By early 2012 the self-serve, pay-by-weight fro-yo concept will have a presence in every U.S. state, as well as in five international markets.

Amit Kleinberger, CEO, says that Menchie's positions itself as an "all-American" business model with no strong regional identity. The model centers on offering a variety of innovative frozen yogurt flavors, all developed in-house through Menchie's R&D department. Signature flavors like chai tea, watermelon tart, Georgia peach, root beer float and white chocolate macadamia nut, as well as more traditional flavors, rotate in and out of the stores, which offer a selection of 12 to 14 varieties and a wide assortment of toppings daily. "We're launching our own private label," Kleinberger says. "We're reinventing the flavors and coming up with innovative new trademarked variations. Every month, we're rolling out something new."

Menchie's also hired an expert and consultant on retail customer service to develop customized training materials for its franchisees, managers and crew members. It's part of a new drive to develop a world-class "we make you smile" customer service initiative.

This summer Menchie's kicks off a premium program showcasing a series of collectible toys, which are given to guests at every visit. While at press-time Kleinberger declined to offer details, he says it, like the chain's intense focus on customer service and product innovation, will help to create yet another big point of distinction for the chain.

Fast Facts

• Year founded: 2007
• Headquarters: Encino, Calif.
• Menu specialties: Premium private-label frozen yogurt
• Service model: Retail self-service, QSR
• Units: 90
• 2010 sales: $49.5 million (U.S. and Canada)
• 2010 growth: Revenue increased 200 percent and the number of units grew by 966.7 percent
• Projected 2011 growth: Revenue is expected to grow 180 percent and the number of units will increase 210 percent
• Key expansion markets: All 50 states, New Zealand, Australia, Japan, China, India, Qatar, Bahrain, Kuwait, Saudi Arabia, United Arab Emirates, Egypt, Morocco, United Kingdom, Costa Rica, Mexico, Canada, Trinidad and Tobago
• Typical location: Residential shopping centers, premium malls/outdoor lifestyle centers, strip centers
• Average unit size: 1,250 sq. ft.
• Average kitchen space: 300 sq. ft.
• Average covers per day: 500
• Average check: $7
• Total equipment investment per unit: $130,000
• Total unit cost: $360,000

Key Players

• Chief Executive Officer: Amit Kleinberger
• Chief Operating Officer: Adam Caldwell
• Vice President of Operations: Yotam Regev
• Special Operations Manager: Joaquin Quiroz Jr.
• Director of Purchasing: Allen Nino
• Dairy: Scott Brothers Dairy