Planet Smoothie Franchise Review: Q&A with Keith Lehmann of Winter Park, Florida
Planet Smoothie’s 2013 Franchisee of the Year discusses why he joined the brand and what has helped him succeed
Keith Lehmann took an unusual route to becoming a Planet Smoothie owner. With a background in accounting and a bustling brokerage business in Winter Park, Florida, the allure of owning a Planet Smoothie came only after Lehmann helped sell several of the stores for a franchisee who was ready to exit the business. As he studied the books to create a proper valuation for the businesses, he realized that Planet Smoothie was a very strong business opportunity.
Keith and his wife bought their Planet Smoothie franchise about eight years ago. Keith is still a broker, but he conducts all the outside marketing for the family Planet Smoothie business. His wife oversees operations, and recently their teenage son joined the staff.
“I like having the ability to offer him an employment opportunity where I’m not just giving him money,” Keith says. “He is earning his own money, which is a life lesson, and he gets a different perspective. Whether he ever gets into something like that for himself is a different story, but my kids have now grown up with the idea that we are business owners.”
Here is Keith Lehmann’s story.
What did you do before owning a Planet Smoothie?
I went to college and earned a master’s in accountancy. When I got out of school, I got involved with a restaurant management company. It was a small company that wanted help growing. I helped develop internal systems to support their growth, and eventually they became a multi-million dollar company with locations in nine states. I learned a lot about running a business and the different stages of development. When I left, I started my own business providing office management and administration for that same company and for franchisees. I went from running that multimillion-dollar business to overseeing five stores.
Then, I got into a business brokerage. I helped buy and sell ongoing businesses. One of the businesses I helped sell was a smoothie shop, which opened my eyes about the demand for smoothies. Later, I helped a client who owned seven Planet Smoothie franchises and wanted to sell his stores and reinvest the money to start his own franchise concept.
While helping with that multi-unit sale, I became very involved with the Planet Smoothie folks. Many of the franchisees would hire my office to do their back office work, which included bookkeeping and payroll.
A couple of years later, one of the guys who had owned two stores wanted me to help sell his stores. We sold one, and I wound up buying the other one. That is the store I still own.
At the time, we also had a packing-and-shipping store that my wife ran, but she wasn’t happy. It was too slow-paced.
My wife and I met while we were both working for one of those Chinese fast-food mall restaurants. She was the manager and I was helping with the accounting, so we worked closely together. We thrive in a fast-paced environment.
When the opportunity came around to purchase a Planet Smoothie franchise, she said she’d love to run one of those. And I felt I knew enough about the franchise, operations and the administrative side that we made the decision to buy the franchise.
How do you manage your other businesses while running Planet Smoothie?
My wife is the operations manager and manages the day-to-day functions of the store. She blends smoothies, oversees customer relations and manages employees. I do background bookkeeping, dealing with lenders and the landlord.
Sounds like a winning combination. What have you learned over the past seven years?
We bought an existing business, and I expected it to just perform. But, we dropped in sales a bit each year because of a lack of marketing.
I started doing “outside the four walls” marketing. I tried advertising in coupon-like publications such as the ValuPak, but I had never found them to be overwhelmingly successful. At about the same time, we started to participate in area 5K runs. As we began getting involved personally, we realized it was a great atmosphere to market our store.
I started setting up booths and giving out samples, and the more I reached out, the more success we seemed to have. Within a couple of months, sales were increasing. I continued to actively pursue events in the community, from schools to churches to nonprofit functions.
I would ask organizers how I could support their event, but I was honest, explaining that it was not 100 percent selfless. I was there to promote myself and my store. As I sought out more events like health fairs and parades, soon event organizers began calling me.
As a broker, you’ve had the opportunity to see how other franchises operate. How does the Planet Smoothie franchise set itself apart?
As a business broker, people ask me all the time about franchising. I say it all depends!
For a while, I had the two retail stores simultaneously. One of them I would never have done within a franchise because I didn’t feel like there was anything they could offer me. Planet Smoothie is the kind of business I wouldn’t want to do without a franchise.
Certain types of businesses are just convenience stores. My packing-and-shipping store was convenient, and it happened to be where customers would come. But my customers didn’t know me. There was no brand recognition, and it didn’t matter. With the Planet Smoothie franchise, there is strong brand recognition provided through corporate marketing programs that I could never have done all on my own. We do five promotions a year, and it’s all done with professional materials. The national advertising fund provides window panels, menu boards and counter mats. They have also done all product procurement and product testing for you. And with food, where you have to wonder about the nutritionals as well, I would have to find a lab to test it. That is all stuff corporate does for you.
I tell people looking at franchises that if they are looking at food businesses, and they have limited restaurant experience, there are a thousand ways to lose money. With a Planet Smoothie franchise, the business is much simpler. It’s fruit and ice in a cup. The advantage of owning a Planet Smoothie franchise is you can be involved in an immensely popular industry without having a food background. It’s a food-related business that is not as difficult as a full restaurant.
What advice can you give to someone checking out the Planet Smoothie franchise?
My recommendation, because it is a small business, is the more involved you can be, the better the store will perform. It’s not ideal for an absentee owner. Also, you need to have the right manager.
I tell my new employees, the idea is this: our customers are looking for 50/50. That is, 50% product and 50% the experience of coming into the store. Our product is good, but it’s also crucial to be friendly.
An absentee owner has less control over how the store feels and how the product is made. And, because it’s a small business, until you cover your fixed costs, the margins are not always strong enough to be absentee and just have a manager there.
You can make yourself a great paycheck working the store, or it can be a great return on your investment. A multi-unit operator is going to make less money per unit because of having to pay managers, but from an ROI standpoint, they are making a pretty good return. It’s just how you approach it. I have a mom-and-pop approach; if you leave everything to your manager you aren’t going to be as efficient.