New leadership, new menu, new success Steck helping Saladworks emerge from bankruptcy with new identity, image

Saladworks — the nation’s largest fresh-to-order salad franchise — opened its first store in 1986 in Cherry Hill.
Last February, the company filed for bankruptcy.

That didn’t keep Paul Steck, CEO and president, from believing in the brand.

“How can we undo the damage done during (the last) two years of chaos?” he said, after taking over as CEO last June.

The answer?

Better leadership; updated research; and, most importantly, a new menu.

###

The 30-year-old company, which has about 100 franchise locations, certainly needed a better track.

“The prior owners had had a falling out,” Steck said. “They couldn’t even agree on what day of the week it was.”

After two years of lawsuits and depositions, the company filed in February of last year for Chapter 11 bankruptcy in order to end longstanding disputes between the company’s founder, John Scardapone, and Saladworks’ major investor, Commerce Bank founder Vernon W. Hill.

“The purpose of the bankruptcy was not traditional — it was to force the sale of the company upon the previous owners,” Steck said. “We were in and out of bankruptcy in less than four months.”

Centre Lane Partners, a New York-based private equity firm, purchased Saladworks for $17 million as the company successfully worked to pay off nearly $2 million in debt.

That’s when the real work began.

###

“We knew that the menu was old and tired,” Steck said. “It wasn’t responsive to the demands of the marketplace.”

In order to meet changing customer tastes and drive-up sales, Steck created a research and development task force last year consisting of seven franchisees and corporate team members.

“We were definitely behind the curve in doing that,” he said.

Additionally, to ensure the revamp was executed correctly, Steck hired a market research company to travel to 40 Saladworks locations and interview almost 900 customers about what they wanted to see on the menu.

“Younger generations in particular were looking for more unique ingredients, as they have different taste profiles than others are used to,” he said.

But Steck didn’t rush to make immediate menu changes across the board.

“We collected the market research data and shared it with at least 20 percent of our franchisees,” Steck said. “We wanted both customer and franchisee feedback — from dedicated and passionate individuals who own these restaurants with their own money at risk. Providing input and guidance for them just made a lot of sense.”

###

One of the biggest collective concerns was how Saladworks could remain competitive in a market when everywhere from gas stations to fast food establishments were now selling salads.

“We can’t compete with the Wendy’s and the WaWas of the world, so we have to offer elevated products that are intriguing to people,” Steck said.

“Kale was what you used to decorate salad bars with 20 years ago. Now, people are demanding it in their salads. And just six years ago, no one had even heard of quinoa, let alone be able to spell it — now, it’s on every menu you look at.”

Including Saladworks’. The brand’s new menu — which launched in January — includes a new Thai chicken salad, Mediterranean salad and farmhouse salad; seven new toppings, from roasted Brussels sprouts and butternut squash to goat cheese and grapes; five new sandwiches; and a new apple cider vinaigrette dressing.

“We have a very loyal fan base and a large number of customers who visit our stores three to four times a week,” Steck said. “Our product lends itself to that. There is so much more choice with 64 ingredients and 14 different types of dressing.”

Good thing, then, that the average salad with dressing is only 430 calories.

And that’s not the only way Saladworks is striving to become the healthiest fast-casual option for consumers.

“Our industry is abuzz about the concept of farm-to-table, but in reality, you can only get a Jersey tomato two months out of the year at most,” Steck said. “So we have to come up with other ways to source products.

“For us, it’s more about where the food came from, how it was cared for, who grew it and how it was transported. We are always looking for vendors that could help us with all natural and organic products, as well as hydroponic lettuce — we’d love to be able to grow lettuce closer to home here.”

###

Even though home is really its headquarters in Conshohocken, Pennsylvania, Saladworks has more units in the state of New Jersey — 31, to be exact — than any other state.

“What I want to do is expand the brand from its position of strength and move outward,” Steck said. “Certainly, New Jersey is the epicenter of Saladworks.”

But there are still plenty of towns where Steck would like to build the brand’s new, more space- and cost-efficient and sustainable store designs, such as Freehold, Brick and Jackson.

“We should be in those towns,” Steck said. “Cape May is also thriving in the offseason, as is Ocean City — why aren’t we there?

“Let’s focus on New Jersey, where the brand resonates well and we have a ton of loyal customers. Let’s finish what we started here.”

###

Saladworks is well on its way to continued success.

Today, Saladworks has 101 franchise locations in 14 states and three countries, totaling $80 million in revenue for 2015. That number is up 8 percent from 2014.

And Saladworks plans to open 11 new locations this year — four of which will be in New Jersey.

“I’m most proud of the results to date and look forward to improved results in the years to come,” Steck said.

E-mail to: [email protected]
On Twitter: @megfry3