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When Ken Petersen and his partners Tom Brady and Scott Jacobs launched Apricot Lane in 2007 as the first and still only franchised women’s fashion and gift boutique, it was to fill a void in the fashion industry. They expected to  be popular with their target audience of 25- to 35-year-old females, but what they didn’t expect was to be popular with husbands and wives. 

“I saw a void and opportunity in the fashion industry and knew that if we got in, got established, and persevered, we could be very successful,” said Petersen, founder and CEO. “What I didn’t see is just as we were launching the brand that the economy was going to go through the tubes.”

He also didn’t realize the economic crash would be a blessing in disguise: it’s been one of the major pushes that’s enabled Apricot Lane to grow from  a single franchised location to the 76 locations that are  now open or will be by the end of 2011. Essentially, when unemployment is high, in the franchise industry, lead flow increases. 

“People are leaving their jobs, whether they’re getting laid off or leaving the corporate world, and they’re looking at each other wondering what they’re going to do,” said Petersen. The majority of the franchisees working with Apricot Lane are what Petersen calls half-timers—husband and wife teams in the second half of their lives wanting to do something together. 

Thankfully, their desires coincided with another downfall resultant of the economy: real estate development. For the past few years, many national retailers held back their open-to-buys and store openings, creating a void in the real estate market. Apricot Lane and its franchisees took advantage of these opportunities, securing prime locations with under-proforma rents resulting in lower risk.

“Looking back on it, we were blessed to be in the right place at the right time with the right concept, and that was not all because of our astute planning,” said Petersen. “However, the fact that the concept worked in a down economy lays a pretty strong foundation for us as the economy improves.”

In the mix

The unique approach to how each Apricot Lane boutique is set up comes from the partners’ background in the retail gift industry. The branded on-trend apparel and fashion accessories each store stocks are complemented by candles, bath and body products, and unique home décor that give each location a different feel from a typical apparel retailer. Apricot Lane also concentrates on actively scouting out new brands with models in place to give back to the community, sometimes designating a portion of sales back to a nonprofit or doing good for the community in some way.

In addition, its merchandising mix is catered specifically to the demographic, the location, and the availability of product. “Our buying team puts the initial mix together for our franchisees, many of whom have never bought for a store before,” said Petersen. “They also can determine whether the distribution saturation is full in a specific market for a specific product brand.”

This approach to stocking the stores is another reason Petersen feels the Apricot Lane franchise brand is successful. “Our franchise is flexible, and typically those two words don’t go together in the same sentence,” he said. 

The franchise caters its merchandising mix to the local demographic of its stores, which span the country. Because there isn’t corporate control over the brands sold in the store, franchisees are given the power to discover new local artisans and designers from their community and support them in store as well. 

“We find that once a new designers are successful in a particular franchisee’s store, other franchisees hear about them and want to carry them as well,” said Petersen. “This helps increase the brand’s visibility.” 

In addition, Apricot Lane’s build-out approach takes advantage of existing second-generation spaces. It brings in its trademark brick slat wall, which was produced specifically for the Apricot Lane brand, as well as its own flooring and paint colors, but it also uses existing architectural elements to give each of its locations a unique feel.

Owners can choose specific elements they wish to have in their store, such as crystal chandeliers, a children’s area, or even a more shabby-chic antique look. Because of Apricot Lane’s flexibility, it can create stores with these elements included. “We react quickly for the developer, we react quickly for the franchisee, and we customize the merchandise mix for the consumer,” said Petersen.

Kill two birds

On March 3, Apricot Lane opened its first store of the year. It opened four more during March and will open five per month throughout April, May, and June. Petersen said the company is scheduled to open 37 stores throughout this year, but that’s only the figure it’s reached as of March. 

Understanding the reasons behind the numerous franchisee leads is one thing; understanding how Apricot Lane’s franchise company Country Visions has supported such growth is another. Apricot Lane’s approach to handling franchise development is as unique as its boutique style. The process for most franchisors is to receive an inquiry, send corporate information, and invite the potential franchisee to their corporate headquarters to do an in-person Discovery Day. 

Petersen said Apricot Lane used to use the same process simply because other franchisors did. He then realized it took months to go through the initial process—months too long.

Now, the first step in the process is an online Discovery Day webinar that walks potential franchisees through the ins and outs of how the program works. From there, once the person is financially qualified, Petersen spends between 60 and 90 minutes on the phone with the applicant. 

The next step is to pay a visit to the prospective franchisee on their home turf. “I decided we needed to kill two birds with one stone,” he said. “Rather than making our franchisees come to us, we research the market opportunities and get to know them while meeting with leasing representatives at potential centers and educating them more about us and the type of real estate we like.”

Stay focused

In a best-case scenario, within a few weeks of the online Discovery Day, Apricot Lane could have a new franchisee scoping real estate opportunities for a new shop. With technology’s ability to cut weeks out of the process, it’s no wonder that Petersen cast a vision to his staff to make technology a priority for 2011. 

“This year we have to embrace technology, and we have to do more with less,” said Petersen. Text2VIP is one example of what Apricot Lane is doing to go down this path. The full-service text messaging technology gives the brand’s franchisees another way to communicate with consumers and to stay in touch with the millennials that are never far from their cell phones.

Apricot Lane also boosted its staffing complement by hiring a project coordinator, Jonathan Wilson, to improve the brand’s operational efficiency. Already, Wilson has implemented project management software and a task management system to ensure nothing falls through the cracks. He also gathered information from the company’s outsourced stakeholders, such as contractors and architects, and put it into Google Docs to streamline the pre-opening construction process.

“Because of our explosive growth, things slipped through,” said Petersen. “I like to act rather than react, and when I begin reacting, it causes me to step back and reassess. Jonathan is the result of that stepping back.”

In addition, Apricot Lane hired Stacey Graham as its PR specialist. Graham works with the franchisees and offers them PR expertise in boosting their profiles and interacting with their communities, not only during the grand opening but on an ongoing basis. Petersen said it’s one more way Apricot Lane shows its support of its franchisees. 

“The individual franchisees pay her a monthly fee to support them and their stores, and that fee is much lower than they would be paying if they were trying to hire someone on their own,” he said. “My focus at all times is to be the best franchising company out there, to support our franchisees, and to grow our franchise model.”

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