Why restaurant chains actively seek military veterans

It's a sad reality that many find difficult to accept: A shocking number of U.S. veterans are struggling to find a job and, even worse, are often left homeless.

A report from the U.S. Veterans Administration shows the number of veterans returning home from Iraq and Afghanistan who end up homeless has doubled in just two years, with more than 26,500 veterans living on the streets or at risk of losing their homes. And while the unemployment rate for veterans fell by 2.2 percentage points it 2012, it still remains at a high 9.9 percent.

Timothy Lewis was living proof of these bleak statistics. After spending three years in the Navy—during which he served as a machinist in Malaysia, East Timor, and Thailand—he was faced with a civilian world full of economic uncertainty. The 23-year-old found himself on the streets of San Diego with no job and no roof over his head for five long months.

But, channeling the spirit so many in the military possess, he didn’t give up. Instead, he turned to People Assisting the Homeless (PATH), an organization working to end homelessness throughout Southern California. Through the program, he was given a list of job leads in the area, one of which pointed him to a Firehouse Subs unit in San Diego.

Store owner Charlie Glandling was impressed with the drive he saw in Lewis during the interview process. “It was just his go-to attitude, and I think that comes probably from the military background,” Glandling says. “Not accepting ‘no,’ but [asking], ‘What is it I can do to get this job?’” From the day Lewis joined the Firehouse team last October, Glandling says, the veteran has stayed true to this drive and tenacity.

Lewis’s story is just one of many that illuminate the ways in which quick serves are doing their duty to help those who lay down their lives in defense of the country. When they’re not bringing vets on staff, they’re often creating incentive packages to attract veteran franchisees, offering on-the-job training, or writing checks to veterans organizations. And though this assistance is generally given without a single thought as to what they’ll get in return, operators can receive a huge payoff: top-notch employees and franchisees.

Much to his disappointment, Tariq Farid, CEO of Edible Arrangements, says it took him several years to understand the true power of veterans in his company. “I personally never really paid attention to what made them so unique,” he says. “You just called them great entrepreneurs and said, ‘Wow, these people are really good.’ But then you tend to notice some things that they do and, come to find out, they spent either very little time in the military or a lot of time in the military, and they had those disciplines of taking things and running with it and being focused.”

This discipline and unparalleled work ethic is ingrained into soldiers by the military and carried throughout the rest of their career, Lewis says. “[The military] teaches you to be there where you’re supposed to be at the time you’re supposed to be there,” he says. “Somebody tells you to do something, you do it. You don’t ask why or tell them no or get all fussy about it.”

Veterans are also natural-born leaders who understand what it means to have somebody’s back and to work in a team environment, says Justin Livingston, director of global franchise development for Hawaiian coffee and smoothie brand Maui Wowi, which actively seeks veterans as franchising candidates. “There just isn’t a better candidate out there for us,” he says.

Because many processes in the military are highly structured, veterans enter civilian jobs with the ability to follow procedures and rules seamlessly. “The discipline, the chain of command, and the standard operational procedures that you live and die by in the military, that truly works and that’s why I believe franchising is a great mechanism for anybody, but certainly for a military veteran,” says Mike Manzo, chief operating officer of Jersey Mike’s Subs, a brand known for recruiting veterans and contributing to veteran organizations.

The huge contribution veterans make to the health of the U.S. economy can’t be dismissed, either. According to an International Franchise Association (ifa) Education Foundation survey, one out of every seven franchised units in the U.S. is owned and operated by a veteran. These operators employ more than 800,000 people and contribute more than $41 billion to the U.S. GDP.

But the relationship between veterans and limited service isn’t one-sided; foodservice has a lot to offer former servicemen, too, including the guidance and training they need to successfully transition to a healthy and functional civilian life. In addition, being involved with quick service—whether as an hourly employee or a franchise owner—allows returning warriors to connect with the community once again, Livingston says. “It gets them into communities and interacting with people and kind of plugs them back in, which can be really difficult.”

Creating a smoother path and greater job opportunities for veterans were two primary goals that led to the creation of the VetFran program. Launched in 1991 in an effort to aid Gulf War veterans in their transition into civilian life—and relaunched by the IFA after the September 11 terrorist attacks—VetFran now partners with more than 560 companies across a wide range of industries to provide best-deal incentives for veterans interested in franchising.

Since making a commitment in November 2011 to recruit 75,000 veterans and their spouses—in addition to 5,000 soldiers and veterans wounded during service—to franchising by 2014, VetFran has made impressive progress. Nearly 65,000 veterans have entered franchising in the last two years alone.

Josh Merin, senior manager of research and strategic initiatives for the IFA, says franchising is a business in which veterans tend to thrive. One VetFran franchisor, for example, recently studied veterans’ performance within its system, finding that each veteran franchisee ranked in the top 85 percent of the system.

Franchising is also a business that makes veterans happy, Merin says, citing a November 2012 VetFran survey in partnership with Franchise Business Review that showed veterans have higher satisfaction rates with franchising than the majority of franchisees.

But while veterans excel in the world of franchising, financial barriers mean it’s often a struggle to get started in the industry. That’s one reason many quick-service brands offer incentive packages to make ownership easier for ex-military individuals.

Baskin-Robbins’ program, for example, waives its initial $25,000 franchise fee for veterans, in addition to charging nothing in royalties for the first two years (and only charging a fraction of the royalties for the following three years).

“That’s an enormous pickup for a veteran to walk into an environment with zero franchise fee,” says Bill Mitchell, senior vice president and brand officer for Baskin-Robbins. He adds that, in crafting this incentive package, the brand wanted to ensure veterans weren’t forced to invest their life savings directly after completing their service. “In my mind and my analogy, we built an annuity and said, ‘Let us help you in your transition.’”

Maui Wowi offers a veteran discount, helping it to a “Military-Friendly Franchise” designation three years in a row by G.I. Jobs magazine. “That shows how serious we are,” Livingston says. “It’s our humble way of saying ‘thank you’ to folks for the service that they have in their background.”

Maui Wowi’s typical veteran discount is 10 percent off the franchise fee; however, for the past two years, the concept has doubled that discount during November and December in honor of Veterans Day. “It’s 10 percent off of sometimes a $60,000 franchise fee, so that’s $6,000,” Livingston says. “And when we double down, that’s $12,000 off. That is a lot of money.”

But giving veterans a financial advantage right out of the gate isn’t all the help they need, Edible Arrangements’ Farid says. In fact, catering the training process to each individual veteran is essential, he says.

While following procedures and a concrete business plan is something veterans are suited to, “finance may not be their strong suit. Entrepreneurship may not be something that they understand,” Farid says. “Let’s figure out what the weak points are or what the weaknesses are, and let’s spend a lot of energy to give them that confidence.”

One-time training at the beginning of the franchising process won’t cut it, either. At Edible Arrangements, new veteran operators are linked up with fellow ex-military owners to create a mentoring system, and follow-up training is provided at no extra cost.

Just as brands are bringing veteran franchisees on board and giving them the tools to succeed, they’re also making an effort to bring in former servicemen at the unit level. A 2012 Career Builder survey shows that 29 percent of employers are actively recruiting veterans, with 65 percent of employers saying, given a choice between two applicants, they’re more likely to hire a veteran than a non-veteran.

Edible Arrangements is one of those employers. This past February, the brand announced a major initiative, known as “Hero’s Welcome,” that—among other things—aims to provide job opportunities and a career path for an additional 1,000 veterans at its U.S. locations. Farid says the goal will be relatively simple to accomplish, as the brand has 900 units around the country. “It’s that next person you need to hire,” he says.

But the brand and its franchisees are quick to emphasize that they’re bringing veterans on board not as a charitable effort, but because they’re seeking employees who are the best at what they do.

“We want them to know that, not only do we want to give you a job, but we want to give you a job because we think you’re the best person to hire,” Farid says. “And on the other end, we’re going to give you the training that’s required, and we’re going to take you under our wings to help you and help ourselves in the process.”

While this type of employee and franchisee training is becoming commonplace for brands working with veterans, Tijuana Flats—a Tex-Mex chain with 81 units on the East Coast and in the Midwest—offers training of a different nature. Its Chester’s Working Warriors Fellowship, which operates in conjunction with the Orlando VA Medical Center, provides an internship of sorts that teaches veterans basic business skills to help with resume writing, interviewing, and more.

Tijuana Flats began developing the program two years ago and accepted its first two interns in January. The 26-week course, which requires around 20 hours of work each week, lets veterans learn skills in departments such as accounting, human resources, marketing, and nonprofit management.

Camp Fitch, chairman and owner of the brand, says the program is better than “just writing a one-time check. This will hopefully serve them for life.”

Tijuana Flats isn’t keeping the fellowship to itself, either. Instead, it plans to expand the program to its vendors and, eventually, to the broader community.

“The statistics for homeless veterans and unemployed veterans is just unbelievable,” says Nicole DiPietro, vice president of corporate finance and treasury for the company. “If we’re able to put this program in place; have it be a success in our company; share it with our resources, our network of vendors, and our partners; and be able to put this in place in other organizations, then I think we’re doing our part in the community to help the problem and make it better.”

Other brands are doing their part by making charitable donations to military and veteran organizations. Jersey Mike’s not only sponsors the Buddy Bowl—a series of flag-football contests around the country that bring together veterans with post-traumatic stress disorder, for which the brand makes sandwiches for participants—but it also teams up with Wreaths Across America, a 15-year-old organization that lays wreaths on tombstones in Arlington and in veterans’ cemeteries across the country to commemorate fallen soldiers.

In the first year of its four-year partnership, Jersey Mike’s donated $20,000; last year, it helped raise close to $220,000 to lay more than 225,000 wreaths on tombstones in Arlington.

Manzo says that while franchise incentive programs and similar efforts are a huge help to veterans, charitable donations like these have a far-reaching impact. “We give so much to these individual organizations that we feel that that’s affecting a lot of people individually,” he says. “If you have a vet [franchising] program, you’re only affecting a few people.”

CKE, parent company of Hardee’s and Carl’s Jr., is another company known for its donations to military and veteran organizations. At the end of April, it kicked off its three-week-long Stars for Heroes fundraiser for the third straight year. This year, it will raise money for charities like USA Cares, which helps support military families in need.

Since the program launched in 2011, the company and its employees, franchisees, and customers have helped raise nearly $2 million to support more than 40 military organizations nationwide.

Though no brands go into fundraising mode—or offer franchise incentives, recruit veteran employees, or provide on-the job veteran training—to personally benefit from the effort, they do reap some rewards.

First and foremost, efforts like these help build a strong team made up of the highest-quality franchisees and staff members. “There is some mutual reward from targeting veterans as franchisees, because we’re very selective at Maui Wowi about who we reward franchises to,” Livingston says. “Veterans are an unbelievably great representation of the caliber of folks that we just love. It’s an honor bringing them on because of everything they bring to the table.”

Working with and helping veterans also gives employees something to be excited about and proud of, ultimately creating a stronger company culture. “Everyone wants to work for a company they can take pride in and feel good about,” Tijuana Flats’ Fitch says. “We just try to be the facilitator of giving people an opportunity to do for other people.”

He adds that the 40 staff members at the brand’s Orlando-based corporate office were eager to get involved with the Chester’s Working Warriors Fellowship. “They’re all foaming at the mouth, [asking], ‘When’s it my turn? When do I get to spend a week with them?’” he says. “They absolutely love it.”

And while it’s likely the last reason a brand assists veterans, the tangible results are hard to ignore. Because his store is located in San Diego, home to the Navy’s Point Loma base and the Marine Corps’ Camp Pendleton, Firehouse Subs’ Glandling says recruiting and reaching out to veterans helps the unit see a return on investment in terms of revenue and sales.

“You have to do outreach,” he says. “And if you do things right by the community, they’ll do right by you.”