Smoke’s seeks global control
Poutine chain has plans to grow to 1,300 stores worldwide by 2020
Smoke’s Brands, most famous for its poutine-only restaurants, has opened 39 new locations and has dozens more in development about a year after the chain announced it would expand to more than 1,000 shops by 2020.
“I’ve been claiming global domination since I opened up that first one . . . and nobody believed me,” said Ryan Smolkin, founder and chief executive of the company.
Smolkin says he’s hit every expansion target since the poutinerie’s launch in November 2008. The company currently has 76 restaurants in Canada and five in the United States, and is on track to grow to1,300 shops in the U.S. and in western Europe, the Middle East, Australia and in the Asia-Pacific region by 2020.
One of the only ways to accomplish such a bold expansion is through master franchise or licence agreements, said Ann Stone, a lecturer at the University of British Columbia’s Sauder School of Business and former chief marketing officer at several U.S.-based franchised organizations.
Under such agreements, a master franchisor buys rights to develop a geographic area and can then sublicense Smoke’s locations to other franchisees. It’s a very popular model in the Middle East, said Stone.
Smoke’s, in fact, plans to ink those types of agreements for its 150-store overseas expansion, said Smolkin, with the Middle East or the U.K. likely to be first in line.
But master franchise agreements aren’t very popular in the United States, Stone says, where the bulk of the company’s growth is meant to happen.
Hundreds of stores in the U.S., therefore, will be “very challenging” for Smoke’s, Stone said. “I’d say their chances are small.” Smolkin hopes to grow five shops to 800 in the U.S. The company says it won’t offer master franchising opportunities in the U.S., but rather multi-unit agreements.
The company has already sold dozens of units to American franchisees with locations going into development. In Michigan, for example, a group of franchisees will open 10 stores over the next three years, he said.
But the deals can take time to turn into reality. Thirty-three such agreements that existed in June 2015 have yet to materialize into physical eateries. That’s not uncommon, said a company spokesperson, because the company is strategic about real estate location.
Many of the new stores will be in non-traditional venues. Smolkin plans to open 725 poutineries at college and university campuses, sports venues, airports and casinos around the world.
In Canada, 18 of Smoke’s 67 poutineries are on post-secondary school campuses, with 31 more slated to open before the fall semester starts.
“We’re the heartbeat of the college and university world here in Canada,” he said.
As he expands his poutineries, though, Smolkin faces more competition from other chains.
Toronto-based Poutini’s House of Poutine recently opened its second location in the city. And Poutineville now has four Quebec shops and one in Ontario — though it sells other types of food as well, not just poutine.
Even big-name, fast-food chains have started selling the beloved Quebec concoction of french fries, gravy and cheese curds.
In 2013, McDonald’s launched poutine nationwide; it was previously only available in its Quebec restaurants.
In 2012, Wendy’s ran an advertising campaign to make poutine the country’s national dish as it added it to its menu.