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When Customers Become Franchisees

Stocks in this article: PNRA AA ENR

2. Panera Bread
You may know him as a former wide receiver for the Carolina Panthers or as a commentator on ESPN's Sunday NFL Countdown, but former All Pro football player Keyshawn Johnson is also a businessman.

He formed First Picks Management, a business development company, in 2006 to focus on investing in franchised businesses. Johnson also owns a real estate company, Keyshawn Capitol Development.

One of his first choices to invest in was one of his favorite eateries -- Panera Bread (PNRA). First Picks opened the first of what will soon be seven Panera Bread franchises in California in 2007.

The restaurant business is not far from Johnson's comfort zone. He had previously owned Reign, a southern-style restaurant in Beverly Hills, and Profusion in Tampa, Fla. This time Johnson wants to stick with franchised concepts, he says. (He is also a partner with a multi-unit franchisor of Cold Stone Creamery stores in Dallas.)

Stand-alone restaurants are a "little harder in terms of maintaining" compared with a proven franchise "where you have a blueprint you follow and understand," he says.

"I was looking for a concept that made sense both economically and that I liked," Johnson says. "Panera was one of those brands I would frequent quite often. It didn't even really dawn on me that it was Panera. I was just going there and eating and buying the food. As I started to get into the franchise business, this was one of the businesses that came up, and I was, like, 'Wait a minute. I know that logo.'"

"Once I started getting into the business model it just made all the sense in the world," he adds. "It's a growing business and wants to grow on the West Coast. It became the perfect opportunity for me."

Taking a lesson from his football days, Johnson says being part of a great team -- including management, restaurant staff and investors -- is imperative for a successful franchised business, he says.

"Football teaches you about preparation, teamwork and accountability," Johnson says. "Business is very much the same way. You must research, prepare, do the due diligence and be accountable for your moves. Be patient with the process."

More recently Johnson has brought on some of his NFL friends as investors in the development company, including Reggie Bush, Dennis Northcutt, Anthony Henry and Terence Newman.

Johnson hopes to keep expanding in his own territory (which allows for up to 25 restaurants) and others between California's Central Coast and Metro Los Angeles, including the area around the University of Southern California, where he went to school. He is also researching opportunities in the hospitality business.

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