Editor’s note: This article is part of an ongoing franchise series, which highlights brands that are new to or are aggressively expanding via franchising. Is your restaurant starting to franchise? Email us at [email protected].
In 1997, Chris Skodras opened Eggs Up Grill in Pawleys Island, South Carolina, a community near Myrtle Beach. Over the next five to six years, Skodras — whose family had worked in diners for two previous generations — added a few more locations before jumping into franchising. Skodras knew some people in his Bible study group who were McDonald’s franchisees and introduced them to the concept, Eggs Up Grill CEO Ricky Richardson said.
The company slowly grew from there, reaching 24 locations in 2018, when family-owned investment firm WJ Partners acquired the chain. Since then, the company has more than doubled, reaching 59 locations and partnering with over 30 franchise groups in 2022, Richardson said. The concept is predominantly franchised, with one corporate-owned location in Spartanburg, South Carolina, working as a test kitchen and training facility for franchisees, Richardson said. When franchisees first come on board, they participate in a three-week training program at this location.
Twenty-five years in, the company has signed its largest franchise development deal in the brand’s history: a 30-unit agreement with Alliance Food Group owners Ron Donaldson and Ron Donaldson, Jr., to develop Eggs Up Grill in Dallas-Fort Worth.
“[Breakfast/brunch] is a very hot segment,” Richardson said. “It started gaining a lot of momentum and a lot of interest probably six, seven, eight years ago. It’s a space that has a lot of opportunity in it.”
Richardson said Eggs Up Grill offers a compelling model for franchisees. The chain’s restaurants are typically open from 6 a.m. to 2 p.m. and staff about 25 employees, Richardson said. Comparatively, a traditional three-daypart concept would need to employ 50 to 60 workers, which may make Eggs Up Grill’s model more affordable to operate, Richardson said. From a customer standpoint, Eggs Up Grill also offers affordability, with average checks totaling about $12.
During the first quarter of 2022, AUVs for the previous 12 months were about $1.1 million with the top 50% exceeding $1.3 million, according to the company’s website.
Outside of its affordability, Eggs Up Grill has also grown its delivery and takeout channel, which now makes up three to four times the revenue than it did prior to the COVID-19 pandemic, Richardson said.
“That has sustained even as things have returned to normal in most markets,” Richardson said. “That has helped make the business model more attractive for potential franchisees.”
Eggs Up Grill uses Toast’s point-of-sales platform for order entry and to provide servers with handheld devices to take orders at the table. The restaurant also uses a scheduling software that helps franchisees schedule shifts at their restaurants, and has a customer relationship management platform that gives franchisees insights on their guests, including buying behavior. Franchisees can use this program to send emails or text messages to guests, Richardson said.
Development plans: The company expects to end 2022 with a total of 150 restaurants open or committed for future development, Richardson said. Eggs Up Grill plans to have 100 units open by mid-2024 and close to 200 units open by the end of 2026. The chain is targeting the Southeast, but will consider other markets with larger, more experienced franchisees that have plans for significant expansion. Richardson said it would be possible for Eggs Up Grill to eventually reach 300 to 400 units in the Southeast.
Ideal franchisees: Prospective operators don’t need to have a hospitality background. Current franchisees have a wide range of backgrounds, including a first responder, former kindergarten administrator and a retired engineer. Many of the chain’s franchisees started out as guests, too. The company has historically partnered with franchisees that typically sign on for one to three locations, but has begun partnering with larger multi-unit operators with restaurant experience that wish to bring the concept into their markets, Richardson said.
Franchise quick facts
- Liquidity requirement: $150,000
- Net worth: $500,000
- Franchise fee: $45,000 effective Jan. 1
- Royalty fee: 5%
- Marketing fee: 2% (1% to brand marketing fund; minimum of 1% to spend locally)