Smoothie King’s Purpose-Driven Plan for Success
In the last 20 years, quick-service restaurants have strived to become lifestyle choices for American consumers. And companies like Starbucks have claimed the trophy as top-selling lifestyle brands by selling something as simple as a cup of coffee.
From the vantage point of Smoothie King CEO Wan Kim, the size of that trophy isn’t changing. You can just remove the cup sleeve, take off the protective lid, and stick a straw in it.
“Now, people are saying, ‘That’s not what the new lifestyle is.’ They want to live a healthy and active lifestyle and they want to be seen as a person who actually lives that lifestyle,” Kim says. And what better way to do so than hoisting a smoothie for all to see?
Kim has headed up operations at Smoothie King since 2012. The former master franchisee took the reins of a company Steve Kuhnau started in 1973 when he began mixing nutrients and proteins to improve his health. Even in Kim’s early days as CEO, though, smoothies weren’t quite the headline grabbers in foodservice that they are today. Mindful eating was just starting to flex its muscle, and was mostly restrained to fast casual brands and fresh-to-the-scene innovators.
Times have surely changed, and Kevin King, Smoothie King’s chief development officer, says the company is ideally positioned as consumers, especially millennials, drive this new reality.
“There is no sign of those trends slowing down,” says King, who recently celebrated his one-year anniversary with the company. “We think they’re actually increasing and we think we can be a big part of that.”
As Smoothie King expands—it's closing on 900 units—King and Kim are relying on the brand’s trademarked “Smoothies With A Purpose” mission to guide them. It’s the driving force behind everything on the chain’s extensive menu, and what’s inspiring an evolving R&D program that needs to stay on-trend perhaps more than any other segment in the business.
When Smoothie King comes up with a new menu item, it is designed to play a role in the consumer’s life, regardless of what that might be. There are Fitness Blends, Slim Blends, Wellness Blends, and Take a Break Blends, as well as Kids’ Cups.
“I would say we don’t serve smoothies, we serve purpose,” Kim says.
He gives an example. Kim isn’t interested in gaining or losing weight; he just wants to maintain. But then he imagines joining King for a steak dinner that night. “I’ll probably order a smoothie for lunch, and that smoothie will have only 250 calories and 25–30 grams of protein. For me, it’s a tool to stay balanced.”
Here’s another: In Kim’s early days as owner, he asked Kuhnau why he invented the Hulk, an aptly named smoothie featuring roughly 1,000 calories and 30-plus grams of fat. One of Kuhnau’s friends was battling through chemotherapy treatments and needed to gain weight. This has become a common occurrence around the country, one King says results in comments from guests “all the time, a lot of time from spouses or family members who write about their loved ones experience and that it is what helped them get through a tough time.”
Kim can rattle off endless anecdotes and purposes for each smoothie, from muscle gain to recovery to endurance to simple refreshment and great taste. But there’s no denying that this all-encompassing and varied model has been great for franchisees as well as consumers. It is also a critical element in a different area of growth.
In 2012, when Kim purchased Smoothie King, there was one company-owned store. Currently there are 28 scattered across Dallas, New Orleans, and Miami. The most recent opened near Dallas Love Field in May. King says Smoothie King plans to build 11 this year and continue that growth for the foreseeable future.
This is a relatively unique model for such a deep franchising system—not necessarily that amount of company stores, but the fact Smoothie King still cares about building them.
As for why, King says there isn’t a single answer. A starting point, as always, is the bottom line. King says investing capital in company stores has produced great returns. The reason for that is part of the other, more nuanced explanation.
In these locations, Smoothie King can test products, equipment, training strategies, and so on. For example, the brand is currently rolling out a new point-of-sale system. The corporate stores are deploying it first and working out the kinks before handing it off to franchisees. And these units are also a perfect place to foster talent.
“We’d love to have people who have years of Smoothie King experience who go out and support franchisees instead of hiring from the outside all the time,” King says.
This next point might have something to do with Kim’s background as a franchisee. He believes “having our skin in the game,” is good for franchisees and executives alike. Now, every time company brass wants to make a change, they need to consider themselves and their own, intimate stores, not just a round number that stretches across the system. Not to mention the reverse angle: Franchisees appreciate a boss who has his finger on the blender, not just the calculator.
“When we ask franchisees to do something were asking ourselves to do it as well and that helps the conversation,” King says.
That, along with the company’s overall mission, has generated loyal franchisees and leaders, King says. Around 70 percent of the stores opened last year were current Smoothie King owners.
“We reward operational excellence as a primary driver of how we decide who gets new stores. And that’s an important part of what we’re doing. … Wearing a shirt on an airplane or out walking to your car, whatever it might be, people have great comments about Smoothie King,” King says. “It all helps you get excited about what you’re doing every day and it certainly makes you connect with the guests who come into our stores. There is no doubt that makes us a stronger company.”
Moving forward, Smoothie King’s product launches, menu boards, and all related materials will reflect the Smoothies For A Purpose campaign.
“We’re going to be launching more specific smoothies under those categories,” Kim says. “We believe that if we are executing everything based on our mission and vision, we can help the world become a better place. If we have more stores than McDonald’s, there will be less obesity.”