Modern Market signs 41-unit deal with first franchisee

Dive Brief:

Modern Market Eatery has signed its first franchise agreement, a 41-unit deal with Thrive Restaurant Group, the company wrote in an email to Restaurant Dive Monday.
The agreement will expand the nearly 30-unit chain, which is in Colorado, Texas and Arizona, into 11 new markets with an experienced franchisee. Thrive already operates more than 100 restaurants nationwide.
Modern Market’s entry into franchising comes a month after its private equity partner, Butterfly Equity, agreed to acquire 800-unit Qdoba and fold it into Modern Restaurant Concepts.

Dive Insight:

Modern Market first launched its franchising program in July 2021. At the time, the company said it was targeting franchise partners to help it enter underserved metropolitan markets as well as markets that lack healthy food options, according to Fast Casual. The company is also considering non-traditional locations, and has a location in Notre Dame’s student center and a site at Denver International Airport.

As part of its agreement with franchisees, Modern Market said it would provide training programs, site selection support, chef-driven menus, technology integrations, as well as field and marketing support, according to its website. The company expects initial investments to range between $753,500 to over $1.4 million for a single restaurant, depending on total build-out costs and location. As of Aug. 2021, the company reports average unit volumes of $2.2 million and two-year sales growth of 111%.

The new partnership provides Modern Market with the ability to enter into markets Thrive is already familiar with. Wichita, Kansas-based Thrive, which also operates Applebee’s, will not only operate Modern Markets in its home city, but also in Kansas City as well as Texas markets of Austin, San Antonio and Waco; Des Moines, Iowa; Charlotte and Raleigh, North Carolina; and Northwest Arkansas. Modern Market has a handful of locations in Austin, but none in San Antonio or Waco.

Thrive is also actively expanding its own presence. The company, which owns three brands, is expanding its lunch and brunch concept, HomeGrown. It opened its fifth and sixth Homegrown locations this year with a goal of potentially reaching 15 to 20 units in five years, according to Restaurant Hospitality.