Dairy Queen in Brainerd, MN

Guest: Jennifer Rude
Topics: Dairy Queen

Transcript:

Chris Ressa 0:02
This is retail retold the story of how that store ended up in your neighborhood. I’m your host, Chris RESNA. And I invite you to join my conversations with some of the retail industry’s biggest influencers. This podcast is brought to you by DLC management. First, I’d like to thank one of our sponsors credit Intel, knowing the financial health of retailers is crucial for the success of your retail related business. That’s what credit Intel is for credit Intel analyzes the financial health of hundreds of publicly and privately held retailers in different sectors. With a subscription to credit Intel you have access to comprehensive analysis of retailers, financial condition, and their Expert Analytics team. Visit credit intel.com For more information

Welcome to retail retold everyone. Today I’m joined by Jennifer Roode. Jennifer is the franchise development manager for dairy queen. She has been with Dairy Queen for over 20 years. I’m excited for her to be on the show today. Welcome Jennifer.

Jennifer Rude 1:12
Thank you Chris.

Ressa 1:14
This is exciting Dairy Queen and iconic brand. So I love iconic nostalgic brands. Tell us a little bit more about who you are and what you do, Jennifer.

Rude 1:24
Thanks, Chris. I’m a franchise developer with American Dairy Queen Corporation. I cover the Midwest. We divide the country up five ways and so we start with the franchisee inquiry when a franchisee or a prospective franchisee inquires about becoming a franchisee of Dairy Queen. We start with them we walk them through the process of becoming a franchisee and we also hit handle the real estate and site selection for that franchisees DQ grill and show location

Ressa 2:00
got it so it’s not just real estate it’s other parts of the franchise development process that you’re a part of exactly walk us through some of those what are some other parts of the franchise process as somebody makes an inquiry on Dairy Queens website saying you know what, I would be interested in being a franchisee

Rude 2:19
Well, we make sure that they’re qualified first both financially and and that it’s uh, this organization or person is going to be a good fit, going to be a good franchisee of ours and we divide we divide up our responsibility by geography so like I said, I cover the Midwest, and I’ll talk with them about their area of interest. So when people contact us, they may be coming from they may already be out Dairy Queen franchisee they may be coming from outside of our brand, but in the restaurant industry or they may be coming to us from a different industry and in joining and becoming a franchisee of something for the first time.

Ressa 2:59
And I’ve noticed a lot of franchise companies have really pivoted to these mega companies that own multiple franchise agreements throughout a system are many of the franchisees that you work with sole proprietors or have 123 locations, or many of these groups, companies that have 100 other restaurant locations and want 75 Dairy Queens?

Rude 3:29
Well, we have we have some of both ends of that spectrum. So maybe the history of Dairy Queen because it’s over an 80 year old brand, we may have had more of the what would be described as Mom and Pop franchisees. But when we develop today, we’re developing the DQ grill and shell concept, which is a pretty involved concept. It’s a 2600 square foot building with a drive thru big crew. And that operation really, really didn’t doesn’t necessarily lend itself to just one single owner operator model. So we get more folks coming to us that have either had other businesses or have other businesses and some of those include other you know, large portfolios of franchises as long as it’s not a competitively restricted brand.

Ressa 4:25
Okay, that that that makes sense, which leads me into the DQ grill and chill, which is a different concept than what some might think of as the old school Dairy Queen. Why don’t you tell us with with this new prototype a new concept is,

Rude 4:42
well it depends where you are in the country, you may see a lot of the smaller, treat focused menu locations, even some of the locations that were built before a drive thru was a thing and then they were able to add a drive thru later, the DQ grill Lunchable is a menu that includes burgers, fries, chicken strip basket and then of course all of the delicious iconic treats that you know Dairy Queen for the blizzard. The Royal treats Dairy Queen cakes and novelties. I love an Oreo blizzard. That’s a classic

Ressa 5:22
is Dairy Queen rolling out any of the treat only locations right now or they’re all DQ grilling shells

Rude 5:29
were really focused on DQ grill and chill. And it definitely needs to have a drive thru.

Ressa 5:36
Understood. I recently had someone on the podcast from HTO. And he said something interesting which was they were trying to bring the in store experience to the drive thru which I found interesting. So that’s helpful, interesting insights on what Dairy Queen is up to today. How’s business today? What’s going on in the grill and chill world or the treat world? Clearly, we just came out of a very unique time period. All indications when you read headline news is the consumer strong and retail and restaurant is rebounding. What’s Dairy Queen seeing today?

Rude 6:15
Well, Dairy Queen is dread Dairy Queens pretty busy today, during the pandemic. Many of our locations that have drive throughs we’re able to continue serving the fans whenever they wanted you whenever they wanted Dairy Queen wherever they wanted Dairy Queen, but they had to do it all through the drive thru. There were locations we do have locations that don’t have drive throughs or are inside of a mall that really struggled during that time we are seeing the business coming back to those captive venues or to those locations that don’t have drive throughs but the drive thru locations have been very strong. The fans definitely wanted to get there Dairy Queen. During the pandemic, they can visit us for all different kinds of reasons. They want to celebrate something they want to treat themselves, they want to comfort food, they want to console themselves. And they’ve been able to do that. During this time.

Ressa 7:21
I have seen a ton of Dairy Queens throughout the years that were like this, and maybe my descriptions terrible, but like this red barn looking Dairy Queen, and you would walk up order your ice cream, they would give it to you. And then you would either go sit outside and eat it or go bring it home where many of those open they don’t have drive throughs but they were like old ice cream stands. And there’s actually one not too far for me. Were those open through the pandemic,

Rude 7:51
if they if they were able to be open through the pandemic they were. And there are many locations that have adopted third party delivery and ways to get the product to the fan even without a drive thru. mobile ordering third party delivery through DoorDash UberEATS. And providers like that.

Ressa 8:14
Yep, that makes sense. To me. The the word you keep using is fan. Many companies use words customers guests, you’re using the word fan. Is that is that an internal word that Dairy Queen calls the customer? Yes,

Rude 8:28
we we definitely have fans makes

Ressa 8:31
sense it for 80 years, you have to have friends, you’re not around for 80 years. You don’t have fans. That is for sure. Okay. That’s a really helpful insights on what you guys are up to. I want to bring us to a section of the show called Clear the air learn a little bit more about Jennifer, are you ready? I’m ready. All right, Jennifer, what is one skill you don’t possess but you wish you did?

Rude 8:53
I cannot swim. Really? I cannot swim. I can dog paddle. But and I love to snorkel. I love to go boating, I grew up on the water. But if I needed to get to a point if from point A to point B. I, I struggle.

Ressa 9:11
Wow. You have to back me up here. How does someone who grew up on the water? Never have learned how to swim? Well, how does that happen?

Rude 9:21
I tried I took swimming lessons.

Ressa 9:25
So you know how to swim. You’re just not good at it. Yes, exactly. Okay. All right. I don’t know that. I’m a great swimmer either. But I would say I know how to swim. I’m not putting myself in the Michael Phelps territory by any stretch of the imagination. That’s a good one. No one’s mentioned that. That’s a great one. Okay. Question two. When is the last time you did something for the first time?

Rude 9:47
That’s really easy. It was this weekend. My son just started a job and he wears a tie every day. So he has asked my husband to help them tie his ties in And I thought, well, how hard can it be to learn? Let’s just be my husband was it around, I said, let’s just pull up YouTube and let’s just teach ourselves how to tie a tie. And I’m gonna have to continue my lessons there too.

Ressa 10:14
It’s funny, you mentioned tie tie. So recently, I started traveling for work again, and I’m packing my suitcase and I said, You know what, I want to fold my clothes like they do with the clothing store. And lo and behold, you can YouTube that too. And I was learning how to fold clothes like they do at the clothing store. Now, I’m not as good as the people at the clothing store. But I am much improved, and much more organized into my suitcase after watching this 92nd clip.

Rude 10:49
Do you use any kind of a board or anything? So,

Ressa 10:52
unbeknownst to me, I didn’t even know there was a board. So the clip on YouTube said grab a magazine. So my daughter and I grabbed the magazine. And here we were folding so

Rude 11:03
so she’s learning to?

Ressa 11:04
Yes, she’ll be foreign June so she was a big help. Great. Okay. Last question. What is one thing most people agree with, but you do not

Rude 11:15
shameless promotion. But when you go to Dairy Queen, a lot of times people think this is a special occasion. I need to get a big blizzard, I need to get a peanut Buster parfait I need to get something significant. I say go smaller, get the mini Blizzard, try some different ones go a little bit more frequently. It doesn’t have to be a special occasion to treat yourself to a little bit of dessert. Hello, yeah,

Ressa 11:41
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Okay, that was great. I appreciate you sharing. Now I want to turn the tables I want to bring us to Brainerd Minnesota. You have a story about a store there. The floor is yours, Jennifer.

Rude 12:59
Thank you. So how did that restaurant get to that neighborhood and Brainerd Minnesota. It started with the franchisees. So the franchisees have that look of of some Dairy Queens in Brainerd and around Brainerd wanted to build a DQ Guerlain shell. And let me just describe that area a little bit. Brainerd is really central Minnesota. It’s a community called the Brainerd Lakes Community. So it’s about two hours north of the Minneapolis and St. Paul Twin Cities where I’m based. And folks from the Twin Cities go up to these lakes and they vacation in resorts. Many people own a cabin. There is actually a rush hour on Fridays in the spring and summer of people going up to the lakes area. So Brainerd is really the center of this area and where are you would find, you know, Costco target, big box retail. And so they wanted to build another location in Brainerd. And there were two kind of areas of of this community where you’d naturally develop. One is technically Baxter, which is immediately west of Brainerd and along that path of travel that people would take to go to the lakes and the resorts and their cabins and things like that. And then there’s Brainerd itself, where many of the permanent residents live and work and where the high school in the downtown are located. So we looked for multiple locations and the franchisee is is a husband and wife team. They joined our brand when they purchased some Dairy Queens and they actually had kind of an interesting background. She had worked For Dairy Queen for the corporation right out of college, and she was one of the opening team people. And he had had a career in community banking. And they so we looked together we looked, we looked in the traditional retail area along that path of travel. And we also looked in East Brainerd, we found a conversion opportunity was a former KFC. And before that it had been a bank. So it had a drive thru. It had a dining room, it was actually a little bit larger than our than our standard footprint. But it was it was well located and they decided they wanted to locate in that part of town.

Ressa 15:42
Wow. And did you have any concerns that this KFC had failed prior?

Rude 15:50
No, there, there are always some thoughts about that. Why? Why is the other restaurant not? Why did the other restaurant not perform there? And it that really wasn’t a major concern. I can tell you where there were some concerns is, you know, I know your listeners are all real estate professionals. So we’ve all probably entered a space that was a former restaurant that is no longer operating. And your imagination kind of runs away. Yeah, totally. What am I going to find in there? Did they empty the walk in coolers did the power gets shut off. So it’s a little bit daunting. And when we went in, I was with the franchisee and then his broker, you know, showed up with the keys and we entered the space and it was, you know, smelled great and was fairly clean for having been a former restaurant location. And it will be for that it was a bank in the 70s. So it had some interesting you know, ceiling elements that we’ve maybe there was a skylight, they were able to retain the skylight and make it look current and modern and DQ grill and chill finishes everywhere. So it was a good story to go in.

Ressa 17:13
Was this a purchase or a lease,

Rude 17:16
they were able to purchase this property in this building.

Ressa 17:19
And you know, a lot of times these vacant buildings, they’re sometimes tough to purchase because of the current ownership in them. They either used to have income coming in, and if they sell it as bacon, then the price is less because they’re selling it as land essentially, was there a tough economic discussion here? You

Rude 17:38
know, what was really nice is because the Sprich AZ background was in banking, and he was part of the community, they were part of the community. They were pretty well networked to handle the negotiation, they didn’t need a lot of support from us on that. We need to approve the site always and the economics of the site and the layout in that structure and make sure that the brand is going to be able to be well represented and and handle the business. But they were pretty well skilled in that area.

Ressa 18:15
Got it makes sense. And was this a so the way I kind of, I don’t know Brainerd the way I’m kind of hearing it, it seems like it was more is more of a vacation spot. And that’s what really drives it. Is there a year round community?

Rude 18:30
There is definitely a year round community. So I would say the the population in that area between Brainerd and Baxters, probably around 20,000 people, but where they located was actually more serving the community. The permanent community of Brainerd tourists definitely can find the Dairy Queen and visit the Dairy Queen and especially tourism that repeats go into that area gets to know what’s in the area what’s available. But tourism wasn’t the driving the driving reason to go to this location.

Ressa 19:06
Got it. Okay, that makes sense. Now I’ve got better context. That’s an add on if that happens, great, but the permanency of the community supports it on its own.

Rude 19:15
I understand people buy Dairy Queen cakes and take them to their campsite. Oh,

Ressa 19:20
interesting. So it’s the store is open, the store is open and what is the time period when this happened?

Rude 19:26
So the store opened in the summer of 2019. And actually you may have heard of this location because it made national news in December when they experienced a 900 car pay it forward. December of 2020 pandemic uncertainty. People doing everything through the drive through you they get people doing a pay it forward in Dairy Queens, that happens. But it usually fizzles out after 1015 cars, something like that. This location had the Payette forward continue for over two and a half days.

Ressa 20:13
So wow, my mind is blown. So there was 900 cars that went through this drive thru for two and a half days straight, was were they open 24 hours at this point, they were

Rude 20:22
not open 24 hours what would happen is at the end of the day, the there would be a customer that would say, I want to give some extra money so that this Pay It Forward can continue tomorrow. And their area manager she’s really really great at social media and being involved with the community and she put it on the Facebook page for this restaurant. You know, there’s there’s money left for the Pay It Forward. Maybe it’ll continue tomorrow and an amount of going two and a half days.

Ressa 20:52
Wow. So describe for the audience with this Pay It Forward is what’s a pay it forward.

Rude 20:57
Now the Pay It Forward is when a customer says I’m either in the drive thru and they’re saying I’m going to pay for what I’ve just ordered. But I would like to pay for the car behind me. And and then the car behind them gets told your order has been paid for by the car ahead of you. And you have the option if you’d like to do it for for the car behind you. It really became something that was really engaging, the employees were excited about it. The customers were excited about it. Other customers whose customers returned and did it again. Customers left money in a pool for those that might not be able to afford to pay for the car behind them.

Ressa 21:42
Wow, this incredible. So store opens in 2019 gets open and then boom, we have a pandemic there’s a challenge, right? Not not as easy to do business. And there’s a lot of people trying to support local business nationwide. And this store in Brainerd, Minnesota happens to create this pay it forward. And it turned into 900 cars over two and a half days. Was there a continuous line there had to be a continuous line all day. I don’t know if

Rude 22:15
there was a continuous line all day, but it definitely it definitely continued. And I you know what I would I would maybe just contradict you a little bit. I don’t think the store started the path forward. The customer started at the Pay It Forward. And then the customers continued the path forward. And it all became something that was like larger than all of them. It was exciting even for the crew.

Ressa 22:38
So cool. Okay, well, that is something you don’t hear every day. And there was a lot of great stories you heard through the pandemic, but that is one of the better ones. And kudos to American supporting small business self. Absolutely. Great story. Love to hear it. Thank you for sharing. I want to bring us to the last part of the show. You ready, Jennifer? I am ready. All right. I’ve got three questions for you. Okay. Question one. What extinct retailer Do you wish would come back from the dead?

Rude 23:11
I can I gotta say Woolworths. I grew up in a small town. And I can remember being in less Woolworths and I spent a lot of I was a kid. So I spent a lot of time in the candy aisle. And I think I may have even gotten a parakeet there. But I would love it to come back just because I want to see what else did they have? I think they had some of everything.

Ressa 23:33
I didn’t know they had parakeets. But that’s incredible. Okay, no the store though. I love that answer. Question two. What’s the last item over $20 that you bought in a store?

Rude 23:45
There is a local floral and nursery chain here. And we were visiting some friends who just bought a new home so I bought a plant as a housewarming gift.

Ressa 23:58
It tis the season, I’m looking at my grass and making sure I hit the right spots and see the little plants that are struggling making sure I hit them too. So I know well. Love good plants. Okay. Last question. Jennifer, if you and I was shopping at Target and I lost you what I would have find you in? Well, I

Rude 24:17
can guarantee I’ve been in every single aisle of a target from one end to the other every single aisle. But you would definitely find me in the normal grocery aisle coffee, cereal, dairy. I live 10 minutes away from two different targets.

Ressa 24:36
Yeah, you’re in you’re in their home state. So yes, I am. Okay. Well, Jennifer, this was terrific. Thank you so much for coming on. I love the story. The Pay It Forward is incredible. Really cool. Coming out of a pandemic, learning about these types of things. So thank you for sharing. We’ll have to do this again sometime. I

Rude 24:56
really appreciate you having me on Chris. Thank you.

Ressa 24:59
Thank you And thank you for listening to retail retold. If you want to share a story about a retail real estate deal that you were a part of on our show. Please reach out to us at retail retold at DLC mgmt.com This show highlights the stories behind the deals, all perspectives. So it doesn’t matter if you are a retailer, broker, entrepreneur, architect or an attorney. Also, don’t forget to subscribe to retail retold so you don’t miss out on next Thursday’s episode