Smashburger Sees 'Not so Hot' Lending Market: CEO
Diners going to Smashburger restaurants expect to pay a little more for a meal that is made to order.
Smashburger's potential franchisees can expect to spend a little more, too.
"Our franchise partners are really well heeled, $5 million and up net worth," CEO Dave Prokupek told CNBC Friday.
"They’re already running a lot of other franchise concepts. We’re requiring people to build out of cash. That’s one soft spot" in the economy, "there’s not a lot of lending available."
But opportunity is. The hamburger chain has expanded into 149 locations since it opened in 2007. Prokupek said the plan is to open another 50 to 70 stores this year. With each location needing at least 20 workers, that means 1,200 new jobs.
Prokupek spoke after the monthly jobs report showed 227,000 jobs were added in February. He said his confidence about the U.S. economy and the company's ability to expand comes from "consumer demand for our product. We're seeing a big shift in the way people eat."
With an unemployment rate still at 8.3 percent, he's had no trouble drawing employees.
"People want to join a fast-growing brand. We’re giving people lots of opportunity" to earn $1 to $2 above minimum wage but with incentives to earn more. There are also incentives for store managers. he said.
"We’re a top quartile payer. While we have all [salary] ranges, people move up very quickly here," the CEO said. "We’re about letting people make a lot more than what we can hire them at, and it’s fueling our growth."
As for customers, "We're always worried when gas prices go up, but we’re also seeing a number of people paying a $1 extra or so for premium products fresh made. I’d hate to see gas go up too much further. I think people are figuring out how to cope."