Quad-City based Heart of America Group is preparing to share the recipe for success for its Johnny's Italian Steakhouse brand.
Details that typically would be treated as in-house secrets — from how to prepare a signature Johnny's dish to creating the classic supper club decor and ambiance — are being shared as Heart of America begins franchising Johnny's restaurants.
For more than three decades, Mike Whalen's hospitality company has grown slowly and steadily with its restaurants and hotels spreading across the Midwest.
Now, in addition to Heart of America's own growth plans, the company plans to put the Johnny's brand in others' hands. The first Johnny's franchise has been awarded to Larson Companies in Eau Claire, Wis., where the restaurant will open Monday.
Heart of America spent the past year and a half developing guidelines and a system for developing franchises.
"We had enough people saying 'I want to get a Johnny's,' " said Whalen, the company's founder and president. With Heart of America involved in several major developments of its own, including in Davenport and East Peoria, he said "We realized we have so much on our plate ... and there is only so much we can get done."
Selling franchises will expand the Johnny's brand to markets, states — and even other countries — that likely would never have been considered or pursued by Heart of America. "The idea of a Johnny's in Dubai, that's just cool," Whalen said. The company expects it to take five years to go international.
Ajay Singh, Johnny's Italian Steakhouse vice president of brand development, said the Johnny's in Eau Claire will become the eighth Johnny's. The original opened in 2002 in Des Moines and was followed by the one at John Deere Commons, Moline. The other restaurants are in Middleton, Wis.; Omaha; West Des Moines; Olathe, Kan., and East Peoria, which will open in September. Heart of America will build another company-owned Johnny's in Altoona, Iowa.
Depending on whether the restaurant is built as part of a hotel property or a standalone, Singh said the franchisee's investment ranges from $750,000 to $3 million.
Since announcing the franchise opportunity, he said "we have seen a high-degree of interest from as far south as the state of Texas to as far north as Minnesota. We even have had an inquiry as far away as Anchorage (Alaska)."
"Fifty states is our immediate goal, then Canada and Latin America," he said.
Offering a franchise to a third-party and essentially providing a playbook for how to have a successful Johnny's is a vastly different business model for a company that has worked hard to protect its brand's secrets.
"We get to be picky about who we want to play with,'' Singh said. ''There's a vetting process that allows us to select the franchisee."
"It's important they carry on what we call 'the edge.' Once they're in, it's much easier to work in a partnership," he said. "We're looking forward to the day visitors come to Moline and say, 'I've been in a Johnny's in Houston or California.'"
Larson Companies, the first company to franchise a Johnny's, is a real estate development company with more than 20 years of developing and managing hospitality, retail and commercial real estate. Founded in 1990, it is co-owned by the father-and-son team of Richard and Tom Larson.
"We were regular visitors to Des Moines with our own business interests there,'' Tom Larson said recalling his first visit to the Johnny's Italian Steakhouse in West Des Moines. "I was impressed with the concept, menu, service style and the execution. I reached out and got to know the leadership and Mike Whalen, the principal, and was very impressed with that group."
According to Larson, who is the company president, when he first inquired about a franchise, Heart of American was not licensing the concept. But a year and a half later, he is about to cut the ribbon on the first Johnny's as part of his company's $13 million hotel development in Eau Claire. The restaurant was built as part of a 130-room new Holiday Inn protype.
"They (Heart of America) have put together a well-organized franchise," Larson said in a telephone interview. "The other side of that is we're experienced food and beverage operators and we've earned a reputation of being very competent operators. In that sense, it's been a good partnership so far."
Larson said while this is his company's first Johnny's, it may not be their last. "We think this will be a tremendous success that will lead to more Johnny's down the road."
Heart of America's goal is to grow by about 10-15 franchisees a year, Singh said. "I look for us to do 100 franchises by 2020. It's exciting we have a Quad-City brand that is homegrown here, that has the opportunity to become a national brand and someday, an international brand."
Whalen said Johnny's is the only brand that Heart of America plans to franchise for now, but the company already is getting inquiries about its latest brand — The J Bar — which is being developed in Davenport as part of the $35 million mixed-used development known as Elmore Marketplace. He is amazed at "all the buzz" for a brand that hasn't even opened its doors.