D.P. Dough - Industry Q & A

We recently had the chance to talk with D.P. Dough’s Executive Vice President Matt Crumpton, and Director of Franchise Development Tristan Kinsley about their company’s franchise opportunity.

Can you provide an overview of your industry?

Our industry generally would be considered restaurant franchises, specifically the Quick-Service category. We are typically included in the same space as pizza concepts, but we are actually the only national calzone franchise"we call ourselves “The Pizza Alternative.” 

As far as why someone should choose to open a business today, specifically in our industry, I’d say that it’s always a great time to start a business. People who wait on the sidelines for the economic climate to get better are making excuses. Success in business is less about finding the next great idea or the next “right time/right place” and more about the hard work and execution that follows starting a business.  

How has your industry changed in the last 10"20 years?

We have only been around for 3 years (as a franchisor, the concept was started in 1987), but the most important change is the move to technology, especially mobile phones and social media.  This impacts everything in the way we interact with our customers. 

What trends do you see in your industry over the next 5"10 years?

I see more technology playing a bigger role, depending on government regulation. Certainly, we’ll see more customization for customers as a result of technology. Loyalty is not going anywhere. It will be interesting to see what happens with Apple Pay and other alternate payment solutions. 

What is the biggest concern about your industry that a franchise candidate should be aware of and investigate?

Long (and sometimes late) hours are the biggest concern with a late night focused restaurant. The biggest way to mess up a D.P. Dough franchise is to not be fully committed to it or to not be willing to follow the system.  Again, it all comes down to hard work and execution. 

There is no glaring concern about the industry generally. Any franchisee is well advised to conduct due diligence and make sure the franchise system they are looking at fits them from a financial and cultural standpoint. Make sure there are no operational system requirements that are deal-breakers for you that the franchisor requires. 

Why do you think D.P. Dough stands out in the industry?

We are the only national calzone franchise. We are one of the few exclusively college based franchises. We operate in a niche space with so much potential for growth with limited competition. As Warren Buffet likes to say, we’re a business with “a moat.”  In addition, we’ve put a lot of work into the proprietary systems that support our franchisees, and we’re especially proud of how we’ve been able to adopt and integrate new technologies in our custom point of sale, online ordering, and mobile applications.

Why is D.P. Dough more attractive to entrepreneurs than other businesses in your industry?

We have recently rebooted a brand that previously never had anyone at the helm. We have started to rack up some wins. Our owners are energized. We have momentum. We also own our own point of sale company that is custom made for D.P. Dough. Not to mention the 18 days of on-site support that we provide to get our owners off on the right foot. On top of all of that, we have a very competitive royalty rate that puts more money in our franchisees’ pockets.  

Can you describe your ideal candidate.  And do you think your initial requirements are any different than others in your industry?

Someone who is hard working and willing to learn and follow a system.  Someone who takes responsibility for themselves and enjoys being a leader and a coach.  Someone who likes people and has a positive outlook. Obviously, they must be in the proper financial position to open and operate a business.

Our requirements are very similar to other franchisors. Since we are college focused and will not likely grow to exceed more than 300 units, we may be pickier than other franchisors when it comes to selecting our franchisee partners. We want someone who shares our values and we enjoy interacting with. 

What’s the strongest skill you require in a candidate? 

The ability to admit that they don’t know everything. (Guess what, neither do we!) Most franchisees have very strong skills in some areas and will need help in other areas. There is no particular substantive skill. The best skill a person can have is to be a life long learner.  We’re in the business of working with our franchisees to develop the best practices for our brand.  They’re in the business of helping us develop those best practices and then implanting and executing them as well as possible. 

Describe the working environment of your franchisees

They’ll work in a busy restaurant environment, with periods of intense activity, especially late at night. One unique element is the excitement and youthful energy our franchisees interact with by being a part of the college marketplace. 

Why has D.P. Dough been successful?

Because we are focused on our unique calzone concept and have had discipline to not add pizza or open up in a suburban non-college area. Our brand got a cult following by staying true to its roots: college, calzones, late night, and delivery! In addition to the concept, the recent year-over-year same store success of owners has come from implementation of best practices across the brand since we purchased it in 2011.

What advice would you give someone interested in buying a franchise in your industry? 

Conduct due diligence and make sure the franchise system they are looking at fits them from a financial and cultural standpoint. Make sure there are no operational system requirements that are deal-breakers for you that the franchisor requires. 

Develop a thorough PRO FORMA! Look to see what your numbers will actually be. Remember that if you are taking out a loan, you have to pay income taxes on the value of the loan, so that is even more money to account for in your pro forma. Be serious about the planning process and get an understanding of what day to day life is like in the restaurant. 

How much experience in this industry should a franchisee candidate have should they consider buying a franchise in your industry?

No prior restaurant experience is necessary with D.P. Dough. That is what the training program is for. However, we do like to see some sort of life experience. Like we said, we’re limiting our concept to certain specific markets, so we’ll only have a limited number of franchisee partners.  We like to be careful in who we partner with. Our preference is for people who love life and want to make moves!