Franchisee Success StoriesMarch/April 2023Previous IssuesResource Articles

The Rewards of Resales: Boston Pizza

Experienced multi-unit owner Russ Arthurs rose to a new challenge as a Boston Pizza franchisee through a franchise resale

By Joelle Kidd

Prospective franchisees know there are many decisions to be weighed when looking to buy a franchise. You may have done the work to make sure you’re ready to start your own business, maybe even decided on the concept that’s right for you, but one question remains: new build or resale?

Well, that all depends, says Russ Arthurs, the owner of a Boston Pizza location in Ottawa. “[It] depends on the opportunity, and on the ability to grow.”

With a year under his belt as the full owner of his Boston Pizza franchise, purchased through a resale, Arthurs has done just that, bumping sales up 40 per cent and scoring Boston Pizza’s most prestigious franchisee award, with his location ranking among the top 15 in Canada in 2021.

The road to a resale

Arthurs and his wife moved to Ottawa in 2005, after living in the United States for many years.

There, Arthurs had run several non-franchised businesses, but after returning to Canada, he invested in a retail franchise.

“We did that for 15 years and were up to five locations, so we had some success with that,” says Arthurs. “We were kind of looking for new challenges.”

He was approached by Boston Pizza International about a franchise opportunity outside the city. While Arthurs decided against that original location, he was drawn in by the Boston Pizza concept.

“What I liked about it was so many different options all under one roof. We have family dining on this side, we have a sports bar on the other side. We have delivery, we have takeout. […] We can really be all things to all people,” Arthurs says. “What I liked about the concept as well was we can feed and host a diverse population. We have halal items on our menu, we have gluten-wise items on our menus, we have vegan options.”

At the time, “I didn’t have the experience in restaurants […] I knew there would be a learning curve,” he notes. Choosing a resale opportunity would present a chance for Arthurs to learn the ropes of the restaurant industry, benefitting from the previous owner’s mentorship and expertise, while bringing his own marketing skills to the table.

“I came across an operator here, very close to my home, that was possibly looking to exit. We had discussions and talked about, with my background in sales and marketing, where I saw an opportunity at this location to increase sales,” he explains. “They had very good operations expertise [already]. So we bought in as a partner, with the goal to eventually buy the owner out, over time.”

This plan was a win-win: it gave Arthurs time to learn the nuances of both the restaurant industry and Boston Pizza specifically, and his plan to increase sales meant the previous owner would be selling a higher-value business when Arthurs fully bought him out.

New franchisees joining the Boston Pizza system go through a due diligence process to make sure the prospective franchisee is a good fit and has both the finances and skills to be successful.

For a resale, after this approval process, the franchisee can negotiate a sale with a current franchisee who’s looking to sell their business. Once they’ve come to an agreement, it goes back to the franchisor for approval. Once Arthurs had completed this process, as well as the necessary training at one of the brand’s corporate centres in Toronto, he was ready to jump into the business with both feet.

It was March 2020.

“[We] signed the deal, had no idea what was coming, and the first week was glorious,” he says with a laugh. “It was a great learning week—I was learning to make drinks in the bar—and then all of a sudden we were closed, and I was sitting in an empty restaurant staring out the window, wondering what the heck just happened.”

Despite the sudden unpredictable challenge of COVID-19, Arthurs and his team persevered, ramping up takeout and delivery. Happily, they continued to enjoy support from both the community and the franchisor, and eventually came back to indoor dining stronger than before.

Community spirit

Speaking to Franchise Canada on the one-year anniversary of taking over full ownership of the location, it’s clear Arthurs is enjoying his role as a Boston Pizza franchisee.

“Having been in franchised businesses before, I’m very pleased with Boston Pizza as a franchisor. The support they provide is second to none,” he says, noting how he loves that the franchisor “looks at us as partners, not just a royalty or revenue stream.”

Arthurs brings this care to the customers served at his restaurant, from individuals in the community to the sports teams and corporate groups that come through. “We provide a great atmosphere,” he notes, whether the sports bar—where guests can win prizes cheering on their team—or the laid-back, family-friendly dining room.

For Arthurs, running the restaurant is a family affair—his wife, who has a full-time corporate job, helps out on Friday nights, and three of his four children work in the restaurant. “Many of our guests, our regulars, know my whole family,” he says.

Boston Pizza franchisees can take different approaches to how hands-on they want to be in running their location, Arthurs notes. “Some owners are hands off and have a very good management team running it for them. Other owners are there every day running it themselves, basically operating as a [general manager].”

Arthurs’ approach is to support his management team while taking on a front of house role, as well as doing outreach in the community to help bring in more guests. “I joke that my job is to bring them here the first time, and [the management team’s] job is to keep them coming back, as happy guests, over and over,” he says. He makes use of his community connections from years of coaching sports and business ownership in the area to get his business out there.

People “like the consistency” that Boston Pizza provides as a longstanding Canadian brand, Arthurs says, noting the company has been around for more than 50 years—the original restaurant opened in Edmonton, Alberta in 1964.

“We had a couple come into our restaurant last summer that had attended the first Boston Pizza in Edmonton back in the 1960s,” Arthurs recalls. “They ordered the Boston Brute sandwich, and the gentleman—who’s now in his eighties—said it tasted the same today as it did the first time he had it.

“That earns people’s trust, over the years.”

This trust, built by consistency, is crucial for a new operator, Arthurs says. “Confidence from your guest is paramount. That’s what attracted me to the brand. When you have history and quality on your side, you’re usually in a really good place. You just have to execute it on a daily basis.”

Tips for resales

As his business continues to thrive, Arthurs says he’ll be looking to open additional Boston Pizza locations in the future.

Those may be resales or new builds, depending on the opportunities that arise. Arthurs’ resale rule of thumb is to look for an opportunity where he can bring value. “What I like to take on are places that I can improve and add value to. If it’s a fully functioning, perfect restaurant, you’re going to pay full value for it. I like to take on challenges of places that I know, if I put my family’s stamp on it, we can improve sales.”

For prospective franchisees considering a resale, Arthurs’ advice is to do as much due diligence as possible—but don’t just stop at the balance sheet and income statement. “You want to look at emergent trends in your market—is your market growing or shrinking?”

Unlike with a new build, the age of the building you’re buying is a factor, he notes, and a building inspection is an important part of due diligence. “Factor in those projected future costs that may not appear now on the current income statement.”

The biggest mistake a resale owner can do is “mess with success,” he points out. “Don’t come in and change everything—why reinvent the wheel when there’s a successful plan? Just learn, learn early on, and then just start tweaking as you [see] opportunities for growth going forward.”

After all, the sum of the business is more than what’s on the budget sheet. ‘It’s not just about the history of that business […] it’s about what you can do with it.”