Franchising Evangelist Has Tasted Success, and Wants to Pass It On

Monday, June 11, 2007

Richard Sharoff had just sold his 21 Boston Market restaurants and was trolling for his next big thing about 10 years ago when he happened across a small chain of underperforming Kansas City ice cream shops in need of some marketing.

The stores were poorly located, away from pedestrian and auto traffic. The black-and-white decor was not inviting to the customer. Marketing was nonexistent and the employees were poorly trained. But the chain had two things going for it, he says: great ice cream and the name, MaggieMoo's.

"The name was awesome, and the product was simply incredible," said Sharoff, 60, of Annapolis. "In spite of all of the poor execution, there was surprising guest loyalty. This was a marketing man's dream, and I dove in head first."

Sharoff bought the MaggieMoo's brand name, its franchise agreements and its ice cream recipes. "We essentially paid nothing up front," he said. The founders got a "modest consulting fee" and were promised a share of future earnings. He moved the headquarters to Columbia, Md., and started making the ice cream fresh at each store.

And he started marketing. He hired a cartoonist and a design firm to create Maggie the cow. There was a costumed Maggie at every store opening, a la Ronald McDonald, and Maggie brought ice cream and cake to kids' birthday parties.

The small Kansas City herd of ice cream parlors grew into MaggieMoo's International, one of the new breed of hand-rolled, premium ice cream stores that include Cold Stone Creamery and Marble Slab Creamery.

"He took what was a plain, vanilla, small-franchise concept and developed a real brand concept, developed the Maggie of MaggieMoo's and recognized the need for brand image to help the system," said Mark A. Kirsch, a lawyer for DLA Piper, who specializes in franchising.

By the time Sharoff left the company in 2003 after a disagreement with the board of directors on future expansion, MaggieMoo's had more than 100 stores. The company eventually grew to 184 stores in 36 states, and was sold in February to NexCen Brands for about $16 million, including $10.8 million in cash and $5.3 million in NexCen common stock.

Sharoff now wants to teach future franchisers how to build successful restaurant chains. He has started FranPoint Partners, a seven-member consulting firm, to help nascent chains grow big enough that they can hire real estate experts to advise on the best locations, find marketers to help them attract customers and put together a network of low-cost suppliers for everything from food to knives and forks.

FranPoint will be advising the franchisers -- companies or individuals who started chains and want them to expand. The people who want to buy the franchises are known as franchisees. From his days with Boston Market and MaggieMoo's, Sharoff has been on both sides.

"I can bring a tremendous amount of value to emerging restaurants to help their emerging growth and get them to the 100-unit milestone," said Sharoff, who owns a 30-foot sailboat called Moovin'. "I'm not trying to teach Burger King or Dunkin' Donuts to franchise better. We're trying to help the smaller, undercapitalized chains get there faster and smarter and more efficiently."

FranPoint already has several clients, he said, including a Maryland sports bar chain called the Greene Turtle, a five-store restaurant chain based in Alexandria called King Street Blues, which features Southern food, and D.C.-based Armand's Pizzeria. Sharoff is looking for office space in suburban Maryland.

"Our sweet spot is fine-tuning the concept to make sure it's pointed and ready for success," he said. "We are going to stand in the shoes of the franchiser. If we make them successful, we will make ourselves successful. If we get them to 100 units, we could do very well. If we get them to five units, we would not do very well."

-- Thomas Heath

© 2007 The Washington Post Company