'Hub and spoke' model sparks growth for Great Harvest

by Eric Schroeder
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Great Harvest Bread Co. Babka bread
Great Harvest Bread Co. is expanding at a rapid rate across the United States.
 

DILLON, MONT. — Great Harvest Bread Co. is expanding at a rapid rate across the United States thanks to the introduction of its “hub and spoke” franchise model launched earlier this year. Through the first six months of 2017, Great Harvest said it has 200 locations open with agreements in place to open another 45 by the end of 2018.

The bakery cafe’s primary growth regions are the northeast and southern regions of the United States, with deals in place to open locations in Charlotte, N.C., Duluth, Minn., and cities throughout Alabama. The company plans to eventually expand to major markets, including New York, Philadelphia and Boston.

“Our unique franchise model has set our company and franchisees up for sustained success,” said Mike Ferretti, chief executive officer of Great Harvest Bread. “We have already signed 30 franchise agreements with our existing bakery-cafe owners, which is a testament to our already tremendous owners, quality products and national growth plans.”

Under the new hub and spoke franchise model, franchisees can purchase a large territory that includes a single Great Harvest bakery operation and as many cafe-only units as they want in surrounding towns. The bakery locations would be equipped with ovens and ample space to produce and deliver the hand-milled bread to the nearby cafe-only locations throughout the day.

Great Harvest said the hub and spoke model allows its franchisee owners to own multiple locations under one agreement, while competing against segment rivals in all territories.

“Even though we are maximizing our coverage, we are still serving the same, fresh, quality bread to all of our customers,” Mr. Ferretti said. “We still start our milling process as early as 3 a.m. every morning and that will not change.”

With the new model set, Great Harvest is on target to meet its annual projections, will have more than 200 locations open by the end of the year and is next setting its eyes on major metros

Founded in 1976, Great Harvest operates more than 200 locations across the United States, all of which offer breakfasts, sandwiches, grain bowls, soups, salads, pastries and desserts. The average cost to open a Great Harvest bakery cafe is about $315,000, the company said.

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