Huddle House turned out to be the perfect breakfast franchise for the Little family business.
Mark Little and his 82-year-old father, Taft, are co-owners of a small business empire in Tennessee and Mississippi that includes more than a dozen Huddle Houses and a successful wholesale oils and lubricant company. The Littles became owners of multiple Huddle Houses in the mid 1990s when they were looking for a suitable food franchise to offer in conjunction with family-owned convenience stores. “We wanted to diversify,” Mark Little says. “We tried some food service franchises in our store that didn’t work out. We finally decided that Huddle House was the franchise we wanted to pursue.”
The Littles eventually inched out of the convenience side of their business, but they’ve happily held onto their Huddle House restaurants. Mark likes the Huddle House franchise model because it has a chance of success in small communities. “There’s a sense of community at our Huddle House locations,” Mark says. “A lot of people see us as their local coffee shop, and many of our guests are regular guests.”
All of the Little-owned Huddle House franchises are located in small and medium-sized towns and cities near small highways and thoroughfares. The largest one is in Tupelo, Miss. – population 37,000.
How did you find out about Huddle House?
It was in the1990s when there was a big movement to combine convenience stores with food franchises. We tried having several other franchises with our convenience stores, but the first ones didn’t work out very well. We ended up choosing and ultimately having success with Huddle House because the Huddle House customer matches up well with the demographics of our convenience store customer. We were very accustomed to running 24-hour businesses, and there were not a lot of Huddle Houses around here. It was a good fit.
How many Huddle Houses do you own?
We have 16 restaurants. Three are in West Tennessee, and the remaining 13 are in North Mississippi.
Can you explain more about that?
We’ve learned a lot about how to do it over the years. Back in the 1990s when we worked with Church’s Chicken, Subway or Baskin Robbins, we recognized that restaurants have to run completely different than convenience stores. The customer demographic is similar when it comes to convenience stores and food franchises, but the workers have different skills and experience. We found out how important it is to hire people with restaurant experience. It really helped us to get our feet on the ground with Huddle House. Service in a convenience store is important, but the customer is in the store 60-90 seconds. Customers spend 30-45 minutes or longer in a restaurant. Furthermore, “restaurant clean” is different than “convenience store clean.” If you are just buying a candy bar, you aren’t going to notice a spot that hasn’t been cleaned across the store. In a restaurant, you will. Service and cleanliness are paramount in a restaurant.
Did you have food or retail experience before owning the franchise? How important is that?
I don’t know if one needs retail experience. However, a franchisee has to be pretty well versed in business or be willing to learn it. Even with good service and sales totals, restaurants can go out of business if someone’s not paying attention to the numbers. If they don’t know what to look for in the numbers, they very well could struggle.
What sets Huddle House apart?
From my experience, Huddle House seems to have the highest level of contact with their franchisees. They have franchise area directors who work with 50-60 stores in a region. They are the prime point of contact. We get to see them a lot. They might not always tell you what you want to hear, but the store level contact can be of great help. I think Michael Abt, the new CEO, has made a lot of good moves. It’s almost an entirely new team at the top, and I view that as a plus. Huddle House is really headed in a very positive direction.
How large is the opportunity to grow with Huddle House?
It’s substantial. It’s not inexpensive to build a new Huddle House, but in comparison to the rest of the food service industry, it’s not nearly as expensive. Nationwide there are only about 400 Huddle Houses. That alone says that there’s a lot of room for expansion of this brand. That’s true even in the South, where there are already a lot of Huddle Houses. Because there’s room for more Huddle Houses it will be a different process for the franchise than trying to put in a Subway. In that situation, there are already five other stores or more in town. Finally, the royalty rates are very reasonable compared to other brands. If people have the right financial backing to get into a Huddle House, there is definitely opportunity. There are also opportunities to buy existing Huddle Houses. Actually, that’s primarily the strategy we’ve used to expand.
Who is the Huddle House customer?
Typically, our customers are blue-collar males. We also have a lot of senior citizens. We have the so-called “coffee drinkers.” Five or six of them will come in and drink coffee for a couple of hours and eat a meal. Of course, there’s some transient traffic – truckers, travelers and tourists.
Who are the competitors?
Waffle House is the competitor we look at the most. The local diner is always a competitor. Yet, even if a restaurant comes into your market that serves completely different food than you do, it’s still competition. It just gives the customer another option to consider. Even if a Taco Bell goes in close to you, it’s another choice.
What attracts customers to Huddle House rather than its competitors?
It’s the service, atmosphere and environment. Huddle House has updated its look with the times. Their new layout and design really set them apart. I feel that our menu has a good deal more variety on it than Waffle House. We are a bit more upscale.
How many customers do you typically serve in a day?
We are serving about 4,800-5,000 a day at our 16 locations.
What does your typical day look like?
My typical day starts going at 5 a.m. or before. We are 24 hours a day, which means our (fiscal) day doesn’t end until 6 or 7 in the morning. That’s when the numbers come in. A lot of my day is spent on the phone or on conference calls. I go through reports from my operations directors and their district managers. My day involves a lot of listening, phone calls and follow-ups. Cell phones get burned up. Huddle House fortunately has a good website that can help us track our numbers and gather the data from our point of sales. We can go online and get our guest counts, our item movements for the day, etc.
What is the secret to your success?
Anytime a single restaurant of ours is successful, the No. 1 reason is the people. The most important employee is the general manager. District managers are critical to keeping those general managers focused on the job and in line. A good general manager will make a great store even better and turn a bad store around. A good general manager needs to keep an eye on the numbers they can control – sales, food costs, service.
What kind of person do you think would enjoy owning a Huddle House franchise?
It helps to be an organized person who’s either comfortable with numbers or willing to be taught. Other than that, they need to be a people person. It’s not necessarily an easy business. You have to get everything right. People want their eggs the right way. If the guest says it’s not right, it doesn’t matter if it’s right or not. If it’s not right to them, it’s not right. You have to really enjoy serving others.
What are some personal benefits of franchisee ownership?
It’s a great family business. I know a lot of franchisees who involve their family members in the business. When you are your own boss, you get to make the calls. You can build your own future.
Would you recommend a Huddle House franchise to someone else? Why?
There’s nothing better than being your own boss. Huddle House has favorable startup and ongoing royalty costs. Chances are there’s not a Huddle House right in your backyard, and that’s a good thing. There’s an opportunity with Huddle House to build a true local atmosphere in your store. Even though you are running your restaurants based on the guidelines given to you by Huddle House, they aren’t necessarily strict. Of course, Huddle House restaurants need to be the same when it comes to menu items, but you can still make your restaurant your own. You can be as local as you like, which I think sets Huddle House apart from chains such as McDonald’s.
What is your favorite menu item?
No doubt it’s a patty melt. I believe that Huddle House makes a better one that anybody out there.
Learn more about Huddle House
We’ve had a great 2013, and we’re anticipating an even more exciting 2014. The core values on which Huddle House was founded in 1964 — serving quality food in a warm, friendly environment that brings the community together — remain intact today. Typically open 24 hours, Huddle House serves any meal, anytime. If you think Huddle House might be the right franchise opportunity for you, fill out this form to download our free franchising report or call us at (770) 626-7286.