BusinessReport.com

Troy “Rocco” Moreau opened his first po-boy restaurant 11 years ago because he was disappointed that Baton Rouge didn’t have the authentic sandwiches he grew up eating in New Orleans. Now Moreau is taking steps to franchise his titular Rocco’s New Orleans Style Po-boys and Café across the South, with plans to sell his sandwiches from Texas to Florida.

“We want to have three franchises going by the end of the year,” he says.

Moreau has a plan to start slow, spinning off the popularity of the Rocco’s locations in the Drusilla Shopping Center and in Prairieville, by opening restaurants in Central, Zachary, Denham Springs and West Baton Rouge Parish. Then, he plans to open in nearby college towns—Lafayette and Hammond—to compete with the big sandwich chains. After that, Moreau says it would be time to open Rocco’s in metro New Orleans. “If you’re going to sell a New Orleans po-boy, you need to be in New Orleans,” he says.

Moreau knows about po-boys, growing up in the Ninth Ward. “There were all these authentic places—Domilise’s, Franky & Johnny’s, Rocky & Carlo’s.” But when he headed to LSU in 1987, Moreau says he couldn’t get the same quality of sandwich in Baton Rouge. The bread was wrong. Or the sandwich was made with deli roast beef instead of the roasts that are served with a thick gravy.

The desire to recreate the po-boys he grew up eating, along with Moreau’s entrepreneurial, free-market zeal, led him to open a restaurant at the North Gates of LSU in spring 1997.

“It was a little location, but it wasn’t doing enough to sustain my family,” he says. That led Moreau to open a second location in Drusilla Shopping Center in 2000. That location brought in neighborhood business and helped Moreau make a name for himself as someone who was making authentic po-boys in Baton Rouge.

In 2005, Moreau opened a Rocco’s in Prairieville. After seeing both of his locations do well [the original Rocco’s at the North Gates closed several years ago as part of the redevelopment to build upscale student apartments], Moreau set his eyes toward franchising. “We have people who come in here for lunch three days a week and for dinner two days,” he says. “We decided it was time to really take it to the next level.”

Moreau’s been working on setting up his franchise, meeting with attorneys and potential investors. He’s already discovered one potential snag—an Illinois pizza chain has already filed to use the name Rocco’s. “We can use the name in Louisiana, but if we go outside the state, we’ll have to work a deal out,” Moreau says. That may involve changing the name for locations outside Louisiana or buying the rights to use the name “Rocco’s” in other states.

Scott McKay runs the Gulf South Franchise Authority, a local business that matches franchise owners with potential franchisees. He says the first step for any franchise owner is to write a uniform franchise-offering circular, a book-sized document that details every step of how the business should be run. “You want everybody going into this knowing all the information about the business,” he says.

The second thing a potential franchise owner should think about is how they want to translate their business going into someone else’s hands. Owners want to make sure that franchisees keep up the practices and good name of the business. “Dave Thomas, the founder of Wendy’s, says that franchisees were like his children or grandchildren,” McKay says. “That’s a big family you have to manage.”

Moreau says he wants to see Rocco’s grow and to provide good food in a family atmosphere.

“There are a lot of employees hanging on with this company because we’re franchising,” Moreau says “They see where we’re heading right now, there’s gold at bottom of the mine.”

Franchising is a relatively flexible format, and just about any type of business can be franchised, provided it meets some basic characteristics:

• It needs to be credible. Does your company have experienced management? A track record over time? Is the concept proven? Have you achieved good local press or public acclaim?

• It needs to be unique. Is your business adequately differentiated from its competitors? Is it marketable as a business opportunity? Does it have a sustainable competitive advantage?

• It needs to be teachable. Are the systems in place? Are operating procedures documented? Could someone learn to operate your business in three months or less?

• It needs to provide an adequate return. If a business can’t generate a 15% to 20% return on investment after deducting a royalty [typically between 4% and 8%], it’s going to have difficulty keeping franchisees happy.