Archive for the ‘My Girlfriends Kitchen’ Category

How NOT to close a store

I’m not bringing this up to single anyone out; rather I think there is a lot to learn from this post. I think it’s safe to say this is not the best way to go about closing down your store.

It’s interesting to note that the store was still selling gift certificates even though they were closing down.

Sending out a blast email with a free-for-all-first-come-first-served-take-all-you-want mentality probably isn’t going to be well received and may just be a sure fire recipe for disaster and pissed of buyers.

It’s a great idea to make as many meals as you can and use up as much inventory as you can, but keep a clear head when you do it. You don’t want to just toss open the doors and let the chaos ensue. Closing should still be professional and orderly with a focus on try to accommodate and please customers rather than a last ditch effort to aggravate them.

You still need to conduct business in town, and you certainly don’t want to be the person people refer to with the phrase “Oh… that’s the person who…”

Well, my SIL Carrie forwarded me an email she received from the company stating that they were closing and they were having a sale on their May menu and it excluded the June items.  Prepackaged frozen meals were 50% off. Awesome deal. So me and a  couple of my girlfriends (who happened to be regular, loyal customers to MGFK since the day they opened mind you) went to go grab some grub.

My life, my love, my reality…: My Girlfriend’s Kitchen is a bust

Are the corporate franchises sufficiently funded?

There has been a lot of comments/blame about owners not having sufficient funds to keep their stores open, create the proper marketing and get them through the lean times. But, on the flip side, do the actual corporate franchises themselves have enough money to survive this year?

I believe a lot of the money franchises made last year were through franchise sales rather than actual product sales (dinners sold). Now, if the sale of stores grinds to a halt and is no longer an income stream will the corporate offices be able to make it through this year?

And to add to that, what about franchises like MealMakers, My Girlfriend’s Kitchen and others which have made a mark, but have yet to achieve a national following. Will they have enough money to still be franchises at the end of the year? Will they still be supporting their owners at the end of the year?

There are rough times ahead for owners, but let’s nor forget that we might actually see some franchises closing as this year unfolds. So can the corporate offices handle that hit and what will they do to finically support and fortify themselves?

Where will the meal assembly industry be in 2008?

If you get any sort of magazine subscription you already know the November issue has come and gone and the December issue is probably going to show up today or sometime this week. And in those magazines are huge lists of all of the accomplishments for 2007 and all the exciting things to look forward to in 2008. Regardless of whether you enjoy cameras, computers, cars, wine, stereo equipment, big screen TVs, or most any other hobby I’m sure there is a big wrap up going on right now to reminisce about the past and get you all excited about the future.

For cameras and computers a whole new batch of models has just come out right in time for Christmas. For computers and cameras there is always buzz of faster processors, bigger drives, better displays, more megapixels, new lenses and new software. Canon and Nikon just hit the market with their big new cameras just in time for the holidays. For cars, its new styles, better gas mileage, better safety features and big new uses of alternative fuels, like hybrids, ethanol, bio-diesel, and other advances. New fuel types will be a big deal in the auto world for 2008 and a company not offering in a model in at least one of these areas is more than likely going to get left behind. The point is, right now we are seeing where we have been this year and what lies ahead.

So I bring this around to the meal assembly industry. What have been the accomplishments for this year? What solid innovations did we see this year and what can we expect for next year? What hurdles did the industry face and which of those did it conquer? What obstacles still lay ahead and how will the industry meet those challenges? (And you can’t tell me there aren’t any innovations to be made or challenges to conquer in this industry. A more streamlined process, less prep time at home, a wider menu selection, alliances with other food vendors, great media coverage nationwide, cooking shows, better cookbooks and other avenues to spread the word. There is plenty to do and very little time, if any, to actually do it).

First off, did the meal assembly industry actually accomplish anything this year (besides selling more stores)? Quite honestly I haven’t heard a thing out of the main franchises of Super Supper or Dream Dinners about the challenges they’ve had, how they solved them and what they look forward to working on for the upcoming year. How did they get more customers into the stores? What new features are they going to offer customers next year to help them save time and money? I haven’t either franchise say anything.

I think the biggest accomplishment Dream Dinners has had in the last couple of years was to split the meals and jack up the prices. Have they accomplished anything else? Oh wait, they allied with Redbook to offer a single new recipe this year. Southern Living helped work on their Side Dish Station for December. They did give out trinkets of plastic cups and bowls if you purchased enough meals or signed up early enough. They put Liz Claiborne magazines in their stores to help promote Liz’s clothing. It will be hard, but I will try to contain my childish glee at these major milestones.

Super Supper at least has some accomplishments they can be proud of. They have made alliances with Kraft, Pixar, Martha Stewart and Reynolds to promote themselves. They have offered pick up service, meals that are ready to go, walk-in sessions and several other offerings to placate customers. Hold me back, I think I may swoon with this vast array of offerings… I’ve said their method is to try everything and see what sticks, but it’s better to try everything than to try nothing at all. While nothing jumps out as truly being innovative or setting themselves apart they seem to be at least trying to gain ground and recognition with their customers.

Is MealMakers still in business?
Where is My Girlfriend’s Kitchen?

I can’t remember the last article I read about either of these two. And I mention them because they have a presence in this region. But that just proves that none of the brands are making a splash or giving a reason for customers to come in the door.

Again, my point is, where are these companies and what are they doing? Did they forget they were consumer oriented and thus should keep consumers informed of what they’re doing and how they can help them in their daily lives?

Microsoft and other large companies who thought they didn’t need to bother themselves with customers soon realized the error of their ways and after losing a huge customer base to competitors, they changed their method and did everything they could to keep themselves in front of the customer. Only now is Microsoft starting to get customer loyalty back after several years of keeping them informed of just about every aspect of their business. And Dream Dinners and Super Suppers don’t have anywhere near the customer base to lose or money that MS used in trying to get those customers back.

You cannot deny that the MA business is in trouble – serious trouble. Stores are closing left and right, sales have dropped to a trickle of their former glory and owners are becoming increasingly frustrated at the current state of affairs.

From the initial indicators, Thanksgiving and Christmas may be a dud from the MA side of things. With stores barely breaking even under normal circumstances the next couple of months are traditionally where people really do cook for themselves and could spell the end for dozens of owners if customers don’t come in. If you’ve been paying attention, a couple of owners here have already decided to move on to other endeavors. And I also posted my observations of how many stores were already going up for sale each month.

Honestly, what are Super Supper and Dream Dinners doing to get customers interested in this industry again? At this time almost every other industry unveils their new products, procedures, offerings, innovations or at the very least they give plenty of details what they have in the works and when customers can expect it. What is the enticement for all the customers who have walked away from meal assembly stores in droves to come back?

Obviously I don’t think either of the two major franchises has made a significant impact on this industry during 2007. They are doing business as usual and their involvement with the customer is almost non-existent. I think customers and owners can expect very little from these franchises in 2008. If anything, it will be up to the local owners to market heavily, adapt their daily business and do whatever it takes to keep customers coming back – provided they actually have any money left over each month to accomplish any marketing.

For anyone who might be interested I read and look over 500-600 websites a day that have some relevance to the meal assembly industry. I have a several search tools that scan any new content that gets added to the web – and no I don’t just search Google for “meal assembly”. These searches are done for the web itself, blogs, newspaper articles, Press Releases, business news, and marketing sites. I may not catch everything, but I see quite a bit. The majority of the news of this industry is still customers asking if going to an MA is something they should try or a news article describing a new MA store opening in their area. Not exactly show stopper stuff.

And because of that I am going to offer my predictions on what I think is going to happen to this industry in 2008.

First off I believe at least 500 stores will close their doors in 2008 (franchise and independent). At a rate of 60 MA stores for sale each month right now (and I expect that will probably hit 100 a month or higher by March of 2008) I expect that half of the stores currently open across the country will be for sale, or closed by the end of 2008 – if it even takes that long. And that is conservative. I wouldn’t be surprised if 2/3 of all open stores will be closed by the end of 2008. In reality, I expect it to hit the 500 mark by July/August when the usual summer slump drives a majority of stores into the ground.

Out of those 500 stores I believe 250 of those owners will be declaring bankruptcy of some sort. They won’t be able to sell their store and will simply have to close in order to fend off the debt. I bet a vast majority of those owners will be walking away from this industry at least $50k in debt. Currently, if you get out with less than $100k in debt I think you’re doing pretty darn well.

Independent store owners should fair better than franchises because they can adapt quicker. They can offer customers what they actually ask for and tend to their changing wants and needs. However, I believe this will be a short lived reprieve. Hopefully owners can recoup some loses and get a chance to walk away with less debt.

I believe 2008 will also see super markets and grocery stores start their own meal assembly ventures – although on a smaller, perhaps temporary basis. As the franchise stores close, the grocery stores can fill in that void and give a compelling reason for customers to come in. They will offer the same call ahead and pick up service in a similar capacity to what we see Super Suppers and many independent stores doing now.

MA stores will still dot the country and I’m sure there are places where the MA business can still work and thrive for the people in that area. But as an industry across the nation I think the time for this business has come and gone. The peak for the MA business was last year in 2006 and it’s been on a steady decline ever since. Customers are visiting far less frequently (on the whole), the interest and uniqueness of this business has waned, the prices outweigh the benefit and in the customers eyes the MA store really isn’t filling a void anymore. Most customers already believe they can do the same meal prep at home and unfortunately there is little coming out which negates that theory. They have already returned to their regular routine of the grocery store and take out. Even those stores offering the pick-up, call ahead and pick the meal from the freezer options are still only just breaking even. You can’t run a business on just breaking even.

Super Suppers, Dream Dinners and the rest have waited too long to change consumer opinion. Customers bought into the idea completely last year, but they see little reason to keep investing their time and money. There is no “need” to go the meal assembly store. The “desire” has tapered off and they haven’t been offered anything to rekindle that interest. Franchisors have been off selling more stores rather than keeping customers happy, building services are creating that “want” which will keep them coming back.

I’m sure some will disagree with my assumptions, but I see plenty of indicators to support my predictions.

The Lament of the Disenfranchised

In a lot of the articles I come across the meal assembly business is seen pretty favorably by customers. Articles usually give a positive review of the process and what it can do for people. Aside from the comments of “they don’t use fresh …” or “they use too much … “ they like the idea.

And when I read customer blogs they seem quite happy with the idea too. They think the meals are good, they save a lot of time and the idea of having meals on hand is a real help. Occasionally you run across one that doesn’t like the idea, didn’t like the good, had a bad experience or feels they can do it better themselves, but that’s to be expected. Not everyone has to like it and not all the meals are winners, but overall those customers that are going like going and will probably continue.

Then you read comments made by store owners and there is a whole different perspective. Owners aren’t happy, they aren’t making money, they aren’t spending time with their families, all the money is going to the franchise and they don’t keep anything for themselves, there is too much competition from other stores, construction/build out costs were double what they were told and a whole slew of other issues. And a lot of these comments are from 2006 before all the real trouble started.

The long running thread on Franchise Pundit about the meal assembly business shows a lot of distress about this industry and if you can make money in it. (With most people saying no…)

Although a year later, I still see a lot of those same comments and quite honestly I haven’t really heard from any owner who says they are happy with what they’re doing and they are making a great living with it. I’ve seen quite a few comments from owners who “break even” every month which isn’t too encouraging. I’ve seen comments from owners who aren’t making anything because the franchisor gets their fees and the store keeps going into the red. Not to mention the owners who are taking out loans to keep their stores running, or owners who have their stores listed for sale just so they can get out.

Overall it’s not a pretty picture from the owner viewpoint. But on thing that does actually strike me as unusual is that none of the major franchises such as Dream Dinners, Super Supper, Meal Makers, Dinner by Design or My Girlfriend’s Kitchen have addressed any of these issues. Now, I have seen individual owners who have one of these franchises make comments and offer help, but I have never seen anyone from the corporate offices of these companies try to diffuse these situations. Even to just acknowledge that there “could” be a problem or things “could” be better would probably make a world a difference. But as yet, they turn a blind eye to the whole thing.

And I know they are aware of the comments. I know they are aware of all the negative comments on Franchise Pundit and I know they are aware of this site and others like it. My point is, why hasn’t anyone from these offices addressed these concerns, asked for feedback, asked for solutions or even thanked people for taking the time to write their comments down. If you take the time to write down your complaint for others to read you do so because you care. You want that store to do better. You want them to learn from that mistake. You want help in understanding why something the works or happens the way it does.

It seems to me that if you had so many people complaining about a product you helped create you might take a moment to stop and see what all the noise was about. One or two owners who aren’t happy with their store or the industry is nothing to worry about. It’s the same as one or two customers who aren’t happy with a meal, it just happens. But when you have dozens upon dozens of angry owners from coast to coast that seems like something you might want to pay attention to. Simply ignoring them gives their argument more validity.

Does anyone think there might be a correlation between rising owner frustration and lower customer attendance? In my opinion the franchisors have created this hostile environment, they probably should do something about, besides ignore it.

It’s great that customers still say they like the MA business, but you can’t dispute that there are far less people interested in this business now than there was just a year ago. And with each month the number of customers is growing less and less. It really does appear that the franchisors need to do a lot of work to make their owners happy. I don’t see how you can expect to run a successful business without them.

Speaking of customer loyalty

The topic of customer loyalty comes up quite a bit, so I thought I would offer my opinion on the topic.
The type of loyalty program that the industry needs is one that is integrated within the stores own customer database, with no action required by the store owner other than to be notified of this very important customer.
Some examples, (I guess the timer starts…. NOW, to see which franchise/meal prep software vendor, implements some of these ideas. Hey we aren’t just here to watch, we want to help too)
1. Every customer that comes in and does a minimum of X number of meals for 3 months in a row should automatically get a free meal on their order. It should just pop up on the screen “Hey thanks for your loyalty, you have earned a free meal, please make your additional meal selection” then for each subsequent month, they should get that free meal. If they skip a month, they have to come in for 3 months again to get on that free meal program.

2. Want to run a promotion? How about using promotion codes, every other eCommerce site on the internet does it. Want to reward special customers, give them a code. Put it in your magazine ads, whatever. Don’t want the “special” codes to get out? Make them expire after a certain amount of time. Make them unique. It’s very easy to do. The key here is that when the customer is placing the order, they enter the code and it gives them a free meal (or whatever) automatically, no further action required on the store owners part. It shows up in their order, you know how much extra food you need. It would be in the database for your reporting of promo/giveaway items that you should be tracking for accounting purposes.

3. Giving out items to the customers doesn’t create loyalty, it creates a mentality of “what do I get this month”. Giving out free meals, makes sense, the problem was that it isn’t consistent, and it isn’t AUTOMATIC.
Other businesses need customer loyalty cards to track purchases because their customers can purchase anonymously (does Skippy behind the register at the local sub shop know who you are? No, so they need a loyalty card/key ring etc to keep track) the meal assembly industry already has that tracking system in place; they just don’t use it, effectively.

4. Past purchase tie-ins. You know that the last time you had your super braided dream steak, it was a hit, and you know exactly who purchased that item. Now 3 months later you are A. putting it on the menu again or B. doing something similar. You could query the database and send out an email notifying everyone that purchased that item that it’s back or that “if you liked the super braided dream steak you’ll love the next months even more super dreamy steak”

5. Give the customer a free meal, automatically in their order if they sign up for next month, within the first few days of this month. Again, simple to do, give them a big notice on the screen thanking them for their loyalty, and ordering early.

6. Have some customers that have been in several times but now have been absent for a couple of months? Put a free meal in their account; send them an email saying that as an incentive to come back, you are offering them a free meal on their next purchase.

7. Send out surveys that the customer can fill out and earn a free meal on their next order. Have that free meal show up automatically and remind why they are getting the free meal. “Hi, don’t forget you earned a free meal for filling out our survey back in January and helping us better serve you”

8. Are you running some type of fundraiser where the customer might prefer to donate their free meal credit to some other school/family in need etc? If it’s in the database, it can happen automatically

9. Have a refer a friend program? If it’s in the database, the friend could refer a customer via a email web link, if the friend uses the link to sign up, the referring friend would earn a free meal on the next order and it would show up automatically. Be sure to put a comment on their order of why they got the free meal and send them an email to let them know they earned it.

10. Private party or sample party host earning a free meal(s) have it in the database so that the meal just show up in their next order.

Make these things happen automatically, and REMIND your customer why they are getting the free meal. Print it on their order put it on the printout they use in the store while they are making the meals. Make sure they see it and are reminded of it.

These are just a few things off the top of my head, I’m sure there are dozens of more great ideas out there.

By having these items shows up automatically, (you have noticed I keep mentioning automatically right?) you know how much extra food you need. You are less likely to get caught on Saturday night running low on an item. You spend less time making manual adjustments to orders/inventory/spreadsheets/note cards etc. It would be in the database for your reporting of promo/giveaway items that you should be tracking for accounting purposes.

Should you use all of these promotions at the same time? No, but a mixture of them would probably help.

I’m sure someone somewhere in the industry has done one of two of these things, or are about to, some I claim as my own ideas, the issue is, why haven’t they been doing this all along? It’s not like this is such a difficult thing to figure out. You’ve got a giant database of customers, and you know what they like to eat, why not use it effectively? Also remember that these are things the franchisor or the independent software vendors need to do, not something the individual store owners can do. We certainly don’t expect the store owners to know how to work with the database, but they should have the tools needed to run their business in the most efficient manner.

You are probably saying “well we do some of these things it’s just not automatic” Well then you are spending too much money on the promotion. A free meal the customer earns which requires no further intervention on your part costs very little. Taking10 minutes, or even 5 minutes of your time to enter a free meal onto your customers account multiplied by 100 loyal (hopefully more) customers a month is costing your some real money. Your time is money too. Don’t ever forget that.

There may be all kinds of incentives offered to your customers, but how many of those happen automatically? Please don’t comment about “knowing your customer” etc. Making this process automatic would help you spend more time with the customer, marketing your business etc, and knowing that your loyal customers ARE being rewarded without any manual intervention on your part.

The Meal Blogger
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