Lenny's News and Interviews

Land of Lenny's

April 16, 2010

Second Downtown location saturates market
TOM WILEMON | The Daily News

With the opening of a second Downtown Lenny’s, the Memphis-born restaurant chain has the city covered as good as the hot pepper relish on its signature subs. The new restaurant, slated to open Monday at153 S. Main St., is just a short jaunt of seven blocks - not even a half-mile - from the existing one at 22 N. Front St.

There are so many Lenny’s in Memphis that it’s just about impossible to open a new franchise unless it’s Downtown.

“We give a 1-mile radius in terms of a defined area that a franchise has around a location except for a downtown area, where it can have higher density,” said Brent Alvord, president of Lenny’s.

Older franchise agreements allow exclusive rights within a 2-mile radius. About 30 Lenny’s stores are in the greater Memphis area, accounting for almost one-fifth of all the franchises in the United States.
“There’s really very limited space where somebody new could go into the market legally from our different contracts that we have,” Alvord said.

The owners of the new Downtown restaurant, Lawson Fisher and Tripp Williams, initially entered the Memphis market in January 2008 by buying stores from existing franchisees.

“Tripp was working for FedEx and I was working for a company there in Memphis where we sold telephone systems,” Fisher said. “We both had good jobs. But we just always had a desire to own our own business.”

Besides the new Downtown location, they have stores in Millington, on Sycamore View and on Shelby Drive.

They also own a restaurant in Little Rock, where Fisher lives. The two are Memphis natives in their early 30s who grew up together and have been gulping down Lenny’s Philly cheesesteak subs for years.

Their new store is smack-dab at the center of daytime and nighttime activity. A corner location, it is just a block from Beale Street and The Orpheum Theatre and within easy walking distance of some of Downtown’s biggest employers.

“We really, really love being in that spot,” Williams said. “Everything surrounding that area is top-notch with AutoZone, MLGW, The Orpheum, the Grizzlies and Tigers being right down the street.”

The store has a different look than a traditional Lenny’s. It has a neon sign in front, hardwood floors and an old brick wall.

Being in a tourist area, the location offers the opportunity to introduce the brand to new people.

“We felt that location would be fine and not cannibalize the sales of the other location (Downtown),” Alvord said. “We felt that there was enough business in that whole Downtown area for both locations.

“The other location doesn’t generally stay open later at night. It’s not geared toward that. It’s more of a fast-paced lunchtime crowd.”

The existing store has benefited from additional business from the relocation of the University of Memphis Cecil C. Humphreys School of Law into the old Front Street post office, Alvord said.

The new store is scheduled to open the same day Lenny’s is kicking off its loyalty program with a “Substantial Rewards Card.” The program has a card swipe mechanism and a backup identification system using telephone numbers.

Frequent diners get their 10th sandwich free and a free one on their birthdays if they sign up for the e-mail listing.

Lenny’s has also changed its sandwich board to allow temporary offerings, such as a French dip sandwich.

Another new promotion is an online service that allows customers to order their sandwiches ahead of lunch rushes.

Alvord said sales have remained strong throughout the recession and that Lenny’s has not become embroiled in price wars because its servings are larger than other sandwich makers.

“Where we had some challenges was with people interested in new franchises,” he said. “Bank financing is very tight so banks are not wanting to lend to just about anybody, whether it is for Lenny’s or anybody else.”

Although the company has got Memphis covered, there are still markets for Lenny’s to move into.

“The real opportunities we have for people in Memphis are for those who enjoy vacationing in Myrtle Beach, S.C., where they could set up an operation over there,” Alvord said. “If you like going out to Salt Lake City for skiing or something like that, you could set up new locations there or in other areas of the U.S.”

Len Moore and wife, Shelia Moore, opened the first Lenny’s Sub Shop in Bartlett in 1998. They grew it into a franchise before selling it in 2004.

Today, there are Lenny’s in California, Michigan, Indiana, Colorado, New Mexico, Texas, Oklahoma, Kansas, Missouri, Arkansas, Louisiana, Mississippi, Tennessee, Kentucky, Alabama, Georgia, Florida, South Carolina, North Carolina and Virginia.

Contact Lenny's Public Relations:

Jenna Duett
Marketing and PR Manager
(901) 753-4002