Fueling the explosive franchise growth of this New York style deli franchise in part is the chemistry between Gandolfo's founder, Craig Gandolph and co-owner Dan Pool, former president of the Golden Corral restaurant chain in Raleigh, N.C. and their firm belief in their deli sandwich and sub concept.

That means serving up fresh and healthy hot and cold New York style deli sandwiches, pasta salads and desserts with a huge dose of Frank Sinatra music and New York Mets memorabilia.

"When you have a Gandolfo's sandwich, you should feel as though you are standing in Times Square," Pool said.

"There's a large number of sandwich and sub concepts out there. But we're in a niche of our own," he said. "Quizno's and Firehouse Subs offer toasted breads. Subway and Hogi Yogi offer cold sandwiches. But Gandolfo's has both fresh-made hot and cold sandwiches."

By making their italian subs, sandwiches and salads fresh instead of buying pre-made food products, Gandolfo's has managed to keep its food costs steady amid higher freight shipping costs due to high gas prices, Pool said.

"We slice our own meats, cheeses and make our own salads, which is cheaper than getting prepared products," he said.

To evoke that New York state of mind, Gandolfo's remodeled 31 of its 45 restaurants, adding New York City cab doors, manhole covers and 6-feet tall Statues of Liberty holding Gandolfo's sandwiches.

But Pool's experience in food franchising was the key factor behind the company's rapid expansion. "He was the peanut butter to my chocolate Reese's cup," Gandolph said. "He had experience in growing companies and in administration."

Pool became acquainted with Gandolfo's deli restaurants through Gandolph's two brothers, who were both working at the Golden Corral in North Carolina. Pool left the Golden Corral chain in 1999 and dabbled in another restaurant business, Sonny Barbecue in Atlanta, Ga., before joining Gandolfo's in 2002.

"When Craig made the decision to grow his deli restaurants, he didn't know how to. But I did because I've been with Bennigan's Steak & Grill, Chili's, Golden Corral and Sonny's Barbecue." Pool said. "But he had the product."

Managing Gandolfo's restaurants' rapid growth and maintaining consistency in operations and food quality are challenges that the company tried to overcome through its master franchise program, he said.

"Instead of building our own corporate restaurants, we have a master franchise program where a partner buys rights to a certain market, for instance, Phoenix, and helps us train our franchises there and help them get opened," Pool said. "The master franchisor has to have a proven success record with other businesses."

To cope with the company's projected growth to 400 franchises by year end, Gandolfo's would need to bolster its current team of seven master franchisors with an additional 20 master franchisors. The company's 27 franchise stores in Utah are managed by Tom Gandolph, Craig's father, and Steve Shova, its director of operations.

Gandolph said he sells stores averaging between 1,500 square feet and 1,700 square feet each for an initial fee of about $15,000, plus a monthly royalty fee averaging 6 percent of gross sales.

According to a 2002 report by franchising industry data provider, Uniform Franchise Offer Circular, the number of domestic franchise units grew 12.6 percent to 31,933 between 1999 and 2001 despite recent weakness in the economy. Of that total, 19,275 came from the business-related and fast food restaurant sectors.

Business format franchisors like Gandolfo's, which offer their franchises the license or rights to sell its goods or services and use its business techniques, grew by about 50 percent between 1999 and 2001, the report said.

"Since the Sept. 11 terrorist attacks, people have become more cost conscious. While interest in upscale dining has dropped, the fast casual dining concept, which is cheaper, either stayed flat or had an increase in the past three years," Pool said.

Source:BYU News