Doctor Gets The Shakes With Franchise Offering

JOPLIN, MO. (Monday, March 01, 2004) - It isn't surprising that Chris Roberts would want to build a business that he could pass on to his children someday; his father did the same thing for him. What is surprising, however, is the fact that the business his father passed on to him was a thriving medical practice and Roberts, now a successful physician, has decided that a solid franchise is a more secure and attractive business for his young children to inherit someday.

Roberts joined his father's medical practice in Joplin, MO., nine years ago when he finished his medical residency in Galveston, Texas. He still runs that thriving business today. But in 2002, he purchased the first of three Shakes Frozen Custard franchises he now owns with the idea of turning the franchises into a family business for his children.

It sounds a bit unusual, a physician who followed his father into a medical practice buying a franchise to ensure his children had a secure future. There was a time when people urged their children to be doctors, not ice cream franchisees. Why not push for medical school so his children could follow in the footsteps of their father and grandfather? Roberts says it's a matter of job security.

"The future doesn't look as bright in that field as it did before," says Roberts about medicine. "The old adage that you have plenty of job security in medicine is somewhat over. A lot of us look to the future of medicine and wonder whether we'll all be owned by the government in socialized health care. With everything going on with health care costs and insurance companies and Medicare and malpractice insurance going through the roof, it's harder and harder to go into medicine today. Frankly, the idea of having a family business was more appealing."

He wanted a business that his children could grow up with, and perhaps take over someday. A franchise seemed like the perfect fit.

"In 10 years, my dream is to have one or all of my children involved in this business," he says. "I have four kids, and they can work in the Shakes business while they go to college. I can pay them a salary for work I need done, and they can help for their college. After college, they can take over the business if the choose to."

His children aren't the only family members involved with Roberts' Shakes franchises. His wife handles the bookkeeping, payroll and human resource matters for the business.

How did a physician become involved in the frozen custard business in the first place? Back in 2001, John Harrell, a longtime friend of Roberts, accepted the chief financial officer position with the Shakes Frozen Custard corporate in Joplin, Mo. Over lunch one afternoon, Harrell and Roberts began talking about investments Roberts could make to further his dream of building a business his family could someday inherit. Harrell suggested that Roberts look into investing in a Shakes franchise.

Roberts was already familiar with Shakes because the 50-store chain opened its for store in 1991 in Joplin, where Roberts had grown up.

The more Roberts though about it, the more intriguing the idea became, more so when he learned that Shakes was interested in expanding into the Texas market and creating a larger presence there. Roberts had served his medical residency at the University of Texas in Galveston, and his wife, Jeane, was from the area as well. SO they knew the community, and liked the idea of basing a family business there.

"I saw it as an opportunity to get into a market that was underdeveloped," Roberts says. "We could really have a niche down there. It was southern, it would be warmer for more of the year, and it would be a chance to grow a business in an area where the company wanted to expand. IT was hard to say no that opportunity."

He didn't. In April 2002, Roberts purchased his first Shakes franchise in an existing location in College Station, Texas, and has since signed an agreement to begin initial development of Houston by opening eight stores over the next five years. The first two locations of that agreement were in Webster and league City, and Roberts foresees opening an additional 40 stores within the Houston and Galveston areas within the next 15 to 20 years, time enough to allow his children to grow up, get through college, and become ready to take over the family business.

Growing up and attending medical school in Shakes' home town, Roberts knew first hand that Shakes was built around a frozen custard product that's more like ice cream than custard, made fresh every hour with egg yolks and butterfat. But he also knew that one of his biggest obstacles in Texas would be introducing a product that people weren't familiar with. In Texas, ice cream was ice cream; custard was what you found inside a pie. The solution? Get people to taste it.

"One of our biggest problems in Texas is getting people to understand that frozen custard is really nothing more than good, old-fashioned, home-made ice cream," Roberts said.

While you might think a physician wouldn't know much about running a successful business, that's exactly what a private medical practice is, Roberts pointed out.

"There was a learning curve when I bought into Shakes," he said. "But then I realized that a private medical practice is a small business. I have been dealing with employee issues, hiring and firing, doing payroll, ordering supplies, making sure the office runs, that sort thing, for almost 10 years. I realized that running a clinic isn't all that different than running a Shakes business."

The difference is, he says, physicians must learn those business skills on the job. There are no courses in medical school that teach you how to run an office, deal with employees, handle payroll, order supplies and the like.

"As physicians, we get out of training and are thrust into being businessmen," he says. "In the past, physicians made enough money that they could make terrible business decisions and still get by, but that's no longer the case."

In his medical practice, he learned to find ways to make the business run efficiently while still giving good service. That's what he's been trying to do with his Shakes' businesses.

How's he doing? Monthly sales in his College Station location have averaged 25 to 30 percent higher over previous years' figures, and his Webster location, open since October 2002, took in roughly $372,000 in sales during its first year.

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