$1 BILLION 'STARTUP' WITH AN APPETITE FOR AUSTRALIA
Written on the 1 March 2016 by Nick Nichols
AMERICAN fast-food entrepreneur Peter Cancro may have built a chain of 1200 stores in the US, but he is adopting a startup mentality as he moves to break into the Australian market.
The Jersey Mike's Subs CEO has teamed up with Jack Cowin of Hungry Jack's to roll out the Italian-themed concept to an increasingly health conscious consumer, with the first outlet opening this week on the Gold Coast.
However, just as he did when he bought the original Jersey Mike's store in his home town of Point Pleasant on the famed Jersey Shore as a 17-year-old in the 1970s, Cancro plans to grow the brand in Australia with a grass-roots approach.
"You never play the game over confident," says Cancro (pictured), taking a well-worn line from his high school football years.
That hasn't stopped the affable entrepreneur from beefing up his growth strategy which has seen Jersey Mike's add 200 stores to its stable in the past year and put it well on the way to adding another 250 this year.
The growth has placed it among the fastest growing concept stores in the US in percentage terms, pushing the group's total store revenue to about $1 billion annually.
"It took me 40 years to open 1000 stores, and now in the next four years we plan to open another 1000," says Cancro. "It's good growth but, at the same time, its controlled growth".
While Jersey Mike's has the financial backing to take a 'shock and awe' approach to the Australian market, Cancro says the grass-roots strategy is applied to each new store opening, whether it's in the US or Australia.
Jersey Mike's Aussie campaign is starting at the Q Super Centre in Mermaid Waters on the Gold Coast, a market that Cancro says is not dissimilar to his New Jersey home base with its thriving beach culture.
Cancro has already laid plans to grow store numbers on the Gold Coast to at least three, with the second planned for Benowa Village, while also taking a shot at Brisbane before pushing southern states.
The Australian expansion, the first for Jersey Mike's outside the US, is being spearheaded by James Tomlinson, who has eked out a 32-year career in the Australian food industry.
The Canada-born Tomlinson started with Pizza Hut, rolling dough in an Adelaide store, before rising through the executive ranks. Until last year he had an extensive career with Nando's where he held a number of senior positions during a significant growth phase for the brand.
Tomlinson was introduced to Jersey Mike's through mentor and friend Cowin, who recommended him to Cancro as the man to drive the Australian expansion.
"We think there's a great opportunity for this brand in Australia," says Tomlinson.
"What's on trend in Australia is American food, but good American food, so there is a place for a quality player."
Cancro describes Jersey Mike's as a fast-casual concept, rather than a fast-food business with the food offering similar in quality to sit-down restaurants.
"It's different from what everyone else is doing out there, but it's what businesses used to do," he says.
"We didn't realise back then, but when this business started in 1956 we were doing what everyone is looking for today and that is all about the origin of ingredients."
Tomlinson describes it as 'transparency of food production and provenance', and he says this is driving modern food tastes.
"We're not branding ourselves as a healthy option, but it's real food," he says.
"There's certainly a movement towards that in Australia. Our meatballs aren't made in a factory somewhere. Instead, they're made to an old, Italian recipe in store. We also cook our own roast beefs in store, and it's sliced fresh to order and made fresh to order."
Tomlinson says the Gold Coast was a natural choice for the business, arguing that: "If we started in Sydney, we'd get lost."
That's where the startup philosophy kicks in, with Jersey Mike's first priority to engage the local community it serves.
"Part of the strategy is to get people to come in and get a sub in their hands first," says Tomlinson.
But for Cancro, who learned the art of giving by two local businessmen in Point Pleasant when he became the fourth owner of the hugely popular Jersey Mike's store in 1975, the true test for a local business is in how it engages with that community.
Jersey Mike's franchisees have developed a culture of giving through which they devote one day's profits a week to local charities and causes. According to Cancro, it's part of the DNA of the company and one that has been driven by the franchisees themselves.
On the Gold Coast, Jersey Mike's has decided to support Surf Lifesaving Queensland through the same model.
"We do this with every store in the US as well," says Cancro.
"Every store is a startup and we don't want to lose sight of that. We have that whole mindset of being successful in this one store.
"When we open the next store it will be the same mentality. It's about what we can do and how we can embrace the community so that we all rise up together."
The Australian push is the start of a broader expansion by Jersey Mike's, with Cancro exploring opportunities in Canada. He says the plan is to also move into New Zealand within a few years if he can find the right partner.
Author: Nick Nichols