Blimpie
Encyclopedia
Blimpie is a submarine sandwich
chain
in the United States
. The company is based in Scottsdale, Arizona
.
The first Blimpie store was opened in Hoboken, New Jersey
, in 1964. (The original store called "Blimpie Base" remained unchanged until about 1994 when it was remodeled). By mid-2002, there were about 2,000 Blimpie outlets in operation, located in 47 U.S. states and in 15 other countries. Unlike many restaurant chains, Blimpie does not generally operate "company stores". Virtually all its income is derived from the various fees associated with franchise arrangements. In addition to freestanding outlets and locations in shopping malls and store clusters, Blimpie can be found in a variety of nontraditional sites, such as inside convenience store
s, gasoline station food marts, schools, office complexes, hospitals, and sports arenas.
A key area of growth is in the development or acquisition of other brands. In 1999 the company launched Pasta Central, a franchised chain within the "home meal replacement" category featuring Italian-style pasta and pizza; the concept was exclusively a vehicle for cobranded Blimpie/Pasta Central outlets. Two years earlier, Blimpie International acquired majority control of Maui Tacos, a Mexican quick-service restaurant with a Hawaiian flavor. Maui Tacos in 1998 launched Smoothie Island, a chain offering blended fruit-based beverages.
, New Jersey, operation called Mike's Submarines (which later became Jersey Mike's Subs
), the three friends speculated that a similar restaurant would do well in Hoboken. The store's name came about because owner Tony Conza preferred not to call the sandwiches subs, which he felt sounded too much like a greasy spoon
. Conza preferred the term Hoagies, but Hoboken residents were not familiar with the popular Philadelphia, Pennsylvania
term. So he flipped through a dictionary until he found "Blimp", a word that sounded to him most like a sandwich. The original Blimpie store was an instant hit, and, before long, customers began asking about starting up franchises. The first franchise was sold to a friend in western New York for $600 during the company's first year of operation.
In 1965 Bandassare left the company and Conza and DeCarlo decided to expand into New York City, beginning with a store on 55th Street in Manhattan
. By 1967 there were ten Blimpie restaurants in the chain, four of which were owned by the company's founders. In spite of the chain's rapid growth and good sales volume, profits were difficult to make, and the partners sold the four stores they owned and began to concentrate primarily on franchising. By the mid-1970s, Conza felt the time was ripe to introduce Blimpie subs to the South. Partner DeCarlo, however, was against the move. This disagreement eventually led to a split between the two men. In 1976 Blimpie was divided into two separate entities, with both retaining rights to the Blimpie trademark
. DeCarlo became head of a new, completely independent company, Metropolitan Blimpie (later renamed Blimpie's of New York, Inc.), which controlled franchising rights in New York
, New Jersey
, and other parts of the East Coast. Conza retained control of the original company, which was incorporated in 1977 as International Blimpie Corporation. Conza remained chairman and chief executive officer of Blimpie through January 2002.
Conza began to feel that there was no future in submarine sandwiches, and in 1984 opened the Border Café, a tablecloth restaurant serving southwestern cuisine on Manhattan's Upper East Side. Although the Border Café did reasonably well at first, this shift in focus proved to be a mistake. While Conza was turning his attention away from the subs that had gotten him where he was, competitor Subway, which was founded a year after the first Blimpie's was opened, was beginning an expansion drive that would push it far ahead of Blimpie as the world's foremost submarine sandwich chain.
After the Border Café's initial success, Conza opened two more of them in 1986, one in Woodstock, New York, and the other on the Upper West Side of Manhattan. Unfortunately, the Border Café idea turned out to be a big money loser. Although Astor brought in $4.5 million in revenues for 1987 (its largest total yet), the company showed a net loss of $347,800 for the year. That year, only 30 new Blimpie restaurants were opened, and company stock was in free fall, bottoming out as low as 15 cents per share. Gradually, Conza's interest in his core business began to return. Over the next couple of years, Atlanta became the company's biggest target for new Blimpie's franchises. In 1987, the company celebrated the opening of the 50th Blimpie's store in the Atlanta area by giving away 25,000 free sandwiches to customers there.
By 1988 Conza had realized the error of his ways, and he quickly got out of the Tex-Mex business. Seeing the tremendous success of Subway, Conza decided to redouble his efforts in the hoagie arena. He began to address the Blimpie problem with a more systematic approach than he had used before. The first step in Conza's revitalization program was to identify four fundamental problems plaguing the business: a lack of goals, poor use of financial resources, low employee morale, and procrastination. He then got together with a group of managers and drew up a list of "101 Small Improvements." Delegating to his senior staff much of the day-to-day managing he had always done himself, Conza went on the road in an attempt to open up the long-closed channels of communication between Blimpie and its franchisees.
Next, Blimpie launched a quality-control program aimed at cleaning up its 140 New York
restaurants, which had long been sources of embarrassment to the chain. At the same time, Conza continued in his efforts to improve relations with franchisees, many of whom had become disgruntled over the last decade. In addition to flying to dozens of cities to meet restaurant owners, Conza formed a franchisee advisory council to keep him apprised of important issues; he launched a newsletter called 'No Baloney News' and a toll-free hotline to get important information out to franchisees; and he gave franchisees more control over advertising through the formation of regional advertising co-ops.
In 1989 Blimpie began testing a new low-calorie menu in the hope of attracting a bigger share of the increasingly fat-conscious American public. The new menu, called Blimpie Lite, included a variety of tuna, crab, chicken, and turkey-based items, in both salad and pita-bread sandwich form. The following year, the company launched another test: gourmet salads sold under the name 'Blimpie Fresherie'. Blimpie also began tinkering with its prototype restaurant design around this time, incorporating the company's signature lime-green and yellow colors into a sleeker look for new outlets. By 1990 the Blimpie turnaround was well underway, with system wide sales reaching $120 million per year.
By the beginning of 1992, there were Blimpie restaurants in 27 states. That year, the chain passed the 500-unit mark and the company changed its name to Blimpie International, Inc., reflecting the renewed focus on the sub brand. In the spring of 1993, Blimpie began trading its stock on the NASDAQ exchange. Around this time, the company began to sink more resources into advertising than it had in the past, doubling its marketing budget to about $2 million per year. A new advertising campaign was launched, encompassing just about every medium available, including television, radio, print, and point-of-purchase. This campaign marked the introduction of the chain's new tag line: "Simply Blimpie for fresh-sliced subs." Some of the television spots featured people on the street struggling to repeat the tongue-twisting phrase, "Simply Blimpie."
Sales throughout the Blimpie system reached $132 million by 1993, and Blimpie International earned $1 million on $12 million in revenue. By autumn of that year, the chain had grown to 670 outlets. Improved marketing support from the parent company helped reduce the rate of franchise failures from 10 percent to 3 percent. In some cases, such as in the highly competitive Chicago
market, Conza allowed franchisees to divert their 6 percent annual franchise fee to advertising.
As the 1990s continued, Blimpie came up with a new concept that accelerated the chain's growth even further. Blimpie's franchises began appearing in a variety of nontraditional locations. First it was convenience stores. As convenience store proprietors began to seek out new ways to compensate for declining cigarette sales, they started turning to fast food. Blimpie's was the natural choice for many, for two main reasons: a real kitchen was not required, and startup costs were relatively low (as little as $35,000) compared with other fast-food operations. Among the early nontraditional sites for Blimpie's outlets were the Des Moines
, Iowa
-based Kum & Go convenience store chain; Texaco
Food Marts in Mississippi
; and the food court at the University of Texas. Blimpie's also became part of the first Home Depot superstore restaurant section, located in Atlanta.
In 1994, the company launched several new concepts to further its drive for nontraditional venues. The "Blimpie kiosk" was a movable, condensed restaurant that could fit into a 100 square feet (9.3 m²) area. The kiosk, which could serve four types of sandwiches, drinks, and side orders, was designed for use at stadiums, fairs, and other special events. Other new concepts included a special refrigerated case for convenience stores (Blimpie's fastest-growing market), and the 'Blimpie Bakery', offering a variety of baked goods aimed at boosting early morning business.
Blimpie reached two major milestones in 1995. Largely on the strength of its nontraditional location push, the chain passed the 1,000-outlet mark that year. Blimpie International also lived up to the second word in its name for the first time in company history, with the opening of a location in Stockholm, Sweden. As the 1990s continued, the company looked for more new ways to sell Blimpie sandwiches, including vending machines, outlets in supermarkets, and new types of carts and other mobile product-delivery systems.
With the opening of new outlets in the United States slowing and with overseas growth occurring only at a very slow pace (there were only 61 overseas locations in 15 countries by 2001), Blimpie launched a new diversification effort in the late 1990s. The first such initiative came late in 1997 when the company acquired a 75 percent stake in Maui Tacos, a fast-food chain with six units in Hawaii. This concept featured traditional quick-service Mexican food, such as burritos, tacos, and quesadillas, but with a Hawaiian twist, such as meat marinated in pineapple, lime, and other Hawaiian flavorings. Under Blimpie's majority ownership, Maui Tacos was soon introduced to the mainland, and by 2001 there were 15 such units in nine states and the District of Columbia.
After almost two years of in-house development, Blimpie launched Pasta Central in 1999. Unlike Maui Tacos, Pasta Central was not a standalone concept but was created as a co-branding vehicle that would be coupled with Blimpie Subs & Salads. Co-branding emerged as a hot growth vehicle in the late 1990s and involved the placement of two (or more) restaurant brands within a single unit. There were a number of rationales behind co-branded units, including the idea that the additional choices that they offered customers made them more attractive to groups of people, but for Blimpie International it was the desire to increase dinner revenues that propelled the creation of Pasta Central. Because sandwiches were largely considered lunch fare, Blimpie Subs outlets made the bulk of their sales from 11 a.m. to 2 p.m. Pasta Central, by contrast, with its Italian-style pasta dishes and its pizza offerings, was designed to generate a lot of traffic during dinner, thereby making it complementary to Blimpie. In addition, Pasta Central was also created with a home-meal-replacement component built in – a selection of prepared refrigerated and frozen entrees and prepacked foods for preparation at home. By mid-2001 there were eight units cobranded with Blimpie and Pasta Central, with the units located in Puerto Rico
, Georgia
, South Carolina
, Texas
, and Wyoming
.
A third new concept was 'Smoothie Island', which was launched through Maui Tacos in 1998. Smoothie Island's menu featured beverages blended with frozen yogurt and fruit. In addition to opening standalone units, including such nontraditional locations as airports, health clubs, and grocery stores, Blimpie also planned to co-brand Smoothie Island with both the Maui Tacos and Blimpie concepts—both in dual-branding and tri-branding formats. By mid-2001 there were 80 Smoothie Island units located in the United States, Puerto Rico, and four other countries.
By the turn of the 2000s, Blimpie International was struggling. Net income had fallen steadily throughout the second half of the 1990s. A main factor in this decline was that the subfranchiser rights to the Blimpie Subs chain had largely been sold by the mid-1990s, thus bringing a halt to what had been a steady stream of income. As Blimpie's struggles continued, investors showed little interest in the company, and the price of the company's stock sagged. Seeing little benefit in being a publicly traded firm, Blimpie joined the growing ranks of restaurant companies fleeing the public market. In October 2001 a private investor group led by Jeffrey K. Endervelt, owner of the 44-unit Blimpie of California subfranchise, agreed to buy Blimpie International for $25.7 million. The transaction was completed in January 2002, whereupon Endervelt took over as chairman, president, and chief executive officer, and Conza, who was a partner in the investor group, remained involved at the company but in an advisory capacity. Although Blimpie remained far behind Subway in the battle for hoagie supremacy, the new ownership and leadership perhaps signaled the beginning of a brighter era for Blimpie.
Submarine sandwich
A submarine sandwich, also known as a sub among other names, is a sandwich that consists of a long roll of Italian or French bread, split lengthwise either into two pieces or opened in a "V" on one side, and filled with various varieties of meat, cheese, vegetables, seasonings, and sauces. The...
chain
Franchising
Franchising is the practice of using another firm's successful business model. The word 'franchise' is of anglo-French derivation - from franc- meaning free, and is used both as a noun and as a verb....
in the United States
United States
The United States of America is a federal constitutional republic comprising fifty states and a federal district...
. The company is based in Scottsdale, Arizona
Scottsdale, Arizona
Scottsdale is a city in the eastern part of Maricopa County, Arizona, United States, adjacent to Phoenix. According to the U.S. Census Bureau, as of 2010 the population of the city was 217,385...
.
The first Blimpie store was opened in Hoboken, New Jersey
Hoboken, New Jersey
Hoboken is a city in Hudson County, New Jersey, United States. As of the 2010 United States Census, the city's population was 50,005. The city is part of the New York metropolitan area and contains Hoboken Terminal, a major transportation hub for the region...
, in 1964. (The original store called "Blimpie Base" remained unchanged until about 1994 when it was remodeled). By mid-2002, there were about 2,000 Blimpie outlets in operation, located in 47 U.S. states and in 15 other countries. Unlike many restaurant chains, Blimpie does not generally operate "company stores". Virtually all its income is derived from the various fees associated with franchise arrangements. In addition to freestanding outlets and locations in shopping malls and store clusters, Blimpie can be found in a variety of nontraditional sites, such as inside convenience store
Convenience store
A convenience store, corner store, corner shop, commonly called a bodega in Spanish-speaking areas of the United States, is a small store or shop in a built up area that stocks a range of everyday items such as groceries, toiletries, alcoholic and soft drinks, and may also offer money order and...
s, gasoline station food marts, schools, office complexes, hospitals, and sports arenas.
A key area of growth is in the development or acquisition of other brands. In 1999 the company launched Pasta Central, a franchised chain within the "home meal replacement" category featuring Italian-style pasta and pizza; the concept was exclusively a vehicle for cobranded Blimpie/Pasta Central outlets. Two years earlier, Blimpie International acquired majority control of Maui Tacos, a Mexican quick-service restaurant with a Hawaiian flavor. Maui Tacos in 1998 launched Smoothie Island, a chain offering blended fruit-based beverages.
1960s through mid-1970s
The first Blimpie sub shop was opened in Hoboken in 1964 by Tony Conza, Peter DeCarlo, and Angelo Bandassare, a trio of former high school buddies. Inspired by a successful Point PleasantPoint Pleasant, New Jersey
Point Pleasant is a Borough in Ocean County, New Jersey, United States. As of the 2010 United States Census, the borough population was 18,392...
, New Jersey, operation called Mike's Submarines (which later became Jersey Mike's Subs
Jersey Mike's Subs
Jersey Mike's Subs is a submarine sandwich, or "sub", chain headquartered in Manasquan, New Jersey. The Jersey Mike's franchise has more than 400 stores across the United States.-History:...
), the three friends speculated that a similar restaurant would do well in Hoboken. The store's name came about because owner Tony Conza preferred not to call the sandwiches subs, which he felt sounded too much like a greasy spoon
Greasy spoon
Greasy spoon is a colloquial or slang term originating in the United States to mean a small, especially cheap, archetypal working class restaurant or diner. The term is now used in many English speaking countries to mean the same thing...
. Conza preferred the term Hoagies, but Hoboken residents were not familiar with the popular Philadelphia, Pennsylvania
Pennsylvania
The Commonwealth of Pennsylvania is a U.S. state that is located in the Northeastern and Mid-Atlantic regions of the United States. The state borders Delaware and Maryland to the south, West Virginia to the southwest, Ohio to the west, New York and Ontario, Canada, to the north, and New Jersey to...
term. So he flipped through a dictionary until he found "Blimp", a word that sounded to him most like a sandwich. The original Blimpie store was an instant hit, and, before long, customers began asking about starting up franchises. The first franchise was sold to a friend in western New York for $600 during the company's first year of operation.
In 1965 Bandassare left the company and Conza and DeCarlo decided to expand into New York City, beginning with a store on 55th Street in Manhattan
Manhattan
Manhattan is the oldest and the most densely populated of the five boroughs of New York City. Located primarily on the island of Manhattan at the mouth of the Hudson River, the boundaries of the borough are identical to those of New York County, an original county of the state of New York...
. By 1967 there were ten Blimpie restaurants in the chain, four of which were owned by the company's founders. In spite of the chain's rapid growth and good sales volume, profits were difficult to make, and the partners sold the four stores they owned and began to concentrate primarily on franchising. By the mid-1970s, Conza felt the time was ripe to introduce Blimpie subs to the South. Partner DeCarlo, however, was against the move. This disagreement eventually led to a split between the two men. In 1976 Blimpie was divided into two separate entities, with both retaining rights to the Blimpie trademark
Trademark
A trademark, trade mark, or trade-mark is a distinctive sign or indicator used by an individual, business organization, or other legal entity to identify that the products or services to consumers with which the trademark appears originate from a unique source, and to distinguish its products or...
. DeCarlo became head of a new, completely independent company, Metropolitan Blimpie (later renamed Blimpie's of New York, Inc.), which controlled franchising rights in New York
New York
New York is a state in the Northeastern region of the United States. It is the nation's third most populous state. New York is bordered by New Jersey and Pennsylvania to the south, and by Connecticut, Massachusetts and Vermont to the east...
, New Jersey
New Jersey
New Jersey is a state in the Northeastern and Middle Atlantic regions of the United States. , its population was 8,791,894. It is bordered on the north and east by the state of New York, on the southeast and south by the Atlantic Ocean, on the west by Pennsylvania and on the southwest by Delaware...
, and other parts of the East Coast. Conza retained control of the original company, which was incorporated in 1977 as International Blimpie Corporation. Conza remained chairman and chief executive officer of Blimpie through January 2002.
Late 1970s through 1989
During the late 1970s, Conza was willing to sell franchises anywhere he found an interest. Blimpie began selling franchises both for individual stores and for whole territories. Unfortunately, many of these new franchises were rather isolated from the rest of the chain, and some of the benefits of franchise arrangements had little effect in those locations. Although the chain was growing rapidly, several of the newer stores failed. By 1983, International Blimpie's annual revenues were approaching $1 million, and Blimpie's franchises totaled 150. Conza took the company public that year, with a modest initial over-the-counter offering of 90 cents per share.Conza began to feel that there was no future in submarine sandwiches, and in 1984 opened the Border Café, a tablecloth restaurant serving southwestern cuisine on Manhattan's Upper East Side. Although the Border Café did reasonably well at first, this shift in focus proved to be a mistake. While Conza was turning his attention away from the subs that had gotten him where he was, competitor Subway, which was founded a year after the first Blimpie's was opened, was beginning an expansion drive that would push it far ahead of Blimpie as the world's foremost submarine sandwich chain.
After the Border Café's initial success, Conza opened two more of them in 1986, one in Woodstock, New York, and the other on the Upper West Side of Manhattan. Unfortunately, the Border Café idea turned out to be a big money loser. Although Astor brought in $4.5 million in revenues for 1987 (its largest total yet), the company showed a net loss of $347,800 for the year. That year, only 30 new Blimpie restaurants were opened, and company stock was in free fall, bottoming out as low as 15 cents per share. Gradually, Conza's interest in his core business began to return. Over the next couple of years, Atlanta became the company's biggest target for new Blimpie's franchises. In 1987, the company celebrated the opening of the 50th Blimpie's store in the Atlanta area by giving away 25,000 free sandwiches to customers there.
By 1988 Conza had realized the error of his ways, and he quickly got out of the Tex-Mex business. Seeing the tremendous success of Subway, Conza decided to redouble his efforts in the hoagie arena. He began to address the Blimpie problem with a more systematic approach than he had used before. The first step in Conza's revitalization program was to identify four fundamental problems plaguing the business: a lack of goals, poor use of financial resources, low employee morale, and procrastination. He then got together with a group of managers and drew up a list of "101 Small Improvements." Delegating to his senior staff much of the day-to-day managing he had always done himself, Conza went on the road in an attempt to open up the long-closed channels of communication between Blimpie and its franchisees.
Next, Blimpie launched a quality-control program aimed at cleaning up its 140 New York
New York
New York is a state in the Northeastern region of the United States. It is the nation's third most populous state. New York is bordered by New Jersey and Pennsylvania to the south, and by Connecticut, Massachusetts and Vermont to the east...
restaurants, which had long been sources of embarrassment to the chain. At the same time, Conza continued in his efforts to improve relations with franchisees, many of whom had become disgruntled over the last decade. In addition to flying to dozens of cities to meet restaurant owners, Conza formed a franchisee advisory council to keep him apprised of important issues; he launched a newsletter called 'No Baloney News' and a toll-free hotline to get important information out to franchisees; and he gave franchisees more control over advertising through the formation of regional advertising co-ops.
In 1989 Blimpie began testing a new low-calorie menu in the hope of attracting a bigger share of the increasingly fat-conscious American public. The new menu, called Blimpie Lite, included a variety of tuna, crab, chicken, and turkey-based items, in both salad and pita-bread sandwich form. The following year, the company launched another test: gourmet salads sold under the name 'Blimpie Fresherie'. Blimpie also began tinkering with its prototype restaurant design around this time, incorporating the company's signature lime-green and yellow colors into a sleeker look for new outlets. By 1990 the Blimpie turnaround was well underway, with system wide sales reaching $120 million per year.
Since 1990
The Blimpie chain continued to grow steadily through the early 1990s. Much of this growth was fueled by the company's area developer program, in which franchise rights were sold for an entire area to a developer, who then subfranchised those rights to individual operators. The company continued testing new products throughout this period. In 1991 Blimpie unveiled its 'Quick Bite' menu which included three-inch hero sandwiches for 99 cents, a six-inch bacon, lettuce, and tomato sandwich for $1.59, and a veggie pocket pita sandwich, also priced at $1.59. The company also began testing pizza at a handful of locations in an effort to breathe some life into its dinner business. Conza's attempts to improve franchisee relations continued as well. The company's first annual franchisee convention was held in 1991.By the beginning of 1992, there were Blimpie restaurants in 27 states. That year, the chain passed the 500-unit mark and the company changed its name to Blimpie International, Inc., reflecting the renewed focus on the sub brand. In the spring of 1993, Blimpie began trading its stock on the NASDAQ exchange. Around this time, the company began to sink more resources into advertising than it had in the past, doubling its marketing budget to about $2 million per year. A new advertising campaign was launched, encompassing just about every medium available, including television, radio, print, and point-of-purchase. This campaign marked the introduction of the chain's new tag line: "Simply Blimpie for fresh-sliced subs." Some of the television spots featured people on the street struggling to repeat the tongue-twisting phrase, "Simply Blimpie."
Sales throughout the Blimpie system reached $132 million by 1993, and Blimpie International earned $1 million on $12 million in revenue. By autumn of that year, the chain had grown to 670 outlets. Improved marketing support from the parent company helped reduce the rate of franchise failures from 10 percent to 3 percent. In some cases, such as in the highly competitive Chicago
Chicago
Chicago is the largest city in the US state of Illinois. With nearly 2.7 million residents, it is the most populous city in the Midwestern United States and the third most populous in the US, after New York City and Los Angeles...
market, Conza allowed franchisees to divert their 6 percent annual franchise fee to advertising.
As the 1990s continued, Blimpie came up with a new concept that accelerated the chain's growth even further. Blimpie's franchises began appearing in a variety of nontraditional locations. First it was convenience stores. As convenience store proprietors began to seek out new ways to compensate for declining cigarette sales, they started turning to fast food. Blimpie's was the natural choice for many, for two main reasons: a real kitchen was not required, and startup costs were relatively low (as little as $35,000) compared with other fast-food operations. Among the early nontraditional sites for Blimpie's outlets were the Des Moines
Des Moines, Iowa
Des Moines is the capital and the most populous city in the US state of Iowa. It is also the county seat of Polk County. A small portion of the city extends into Warren County. It was incorporated on September 22, 1851, as Fort Des Moines which was shortened to "Des Moines" in 1857...
, Iowa
Iowa
Iowa is a state located in the Midwestern United States, an area often referred to as the "American Heartland". It derives its name from the Ioway people, one of the many American Indian tribes that occupied the state at the time of European exploration. Iowa was a part of the French colony of New...
-based Kum & Go convenience store chain; Texaco
Texaco
Texaco is the name of an American oil retail brand. Its flagship product is its fuel "Texaco with Techron". It also owns the Havoline motor oil brand....
Food Marts in Mississippi
Mississippi
Mississippi is a U.S. state located in the Southern United States. Jackson is the state capital and largest city. The name of the state derives from the Mississippi River, which flows along its western boundary, whose name comes from the Ojibwe word misi-ziibi...
; and the food court at the University of Texas. Blimpie's also became part of the first Home Depot superstore restaurant section, located in Atlanta.
In 1994, the company launched several new concepts to further its drive for nontraditional venues. The "Blimpie kiosk" was a movable, condensed restaurant that could fit into a 100 square feet (9.3 m²) area. The kiosk, which could serve four types of sandwiches, drinks, and side orders, was designed for use at stadiums, fairs, and other special events. Other new concepts included a special refrigerated case for convenience stores (Blimpie's fastest-growing market), and the 'Blimpie Bakery', offering a variety of baked goods aimed at boosting early morning business.
Blimpie reached two major milestones in 1995. Largely on the strength of its nontraditional location push, the chain passed the 1,000-outlet mark that year. Blimpie International also lived up to the second word in its name for the first time in company history, with the opening of a location in Stockholm, Sweden. As the 1990s continued, the company looked for more new ways to sell Blimpie sandwiches, including vending machines, outlets in supermarkets, and new types of carts and other mobile product-delivery systems.
With the opening of new outlets in the United States slowing and with overseas growth occurring only at a very slow pace (there were only 61 overseas locations in 15 countries by 2001), Blimpie launched a new diversification effort in the late 1990s. The first such initiative came late in 1997 when the company acquired a 75 percent stake in Maui Tacos, a fast-food chain with six units in Hawaii. This concept featured traditional quick-service Mexican food, such as burritos, tacos, and quesadillas, but with a Hawaiian twist, such as meat marinated in pineapple, lime, and other Hawaiian flavorings. Under Blimpie's majority ownership, Maui Tacos was soon introduced to the mainland, and by 2001 there were 15 such units in nine states and the District of Columbia.
After almost two years of in-house development, Blimpie launched Pasta Central in 1999. Unlike Maui Tacos, Pasta Central was not a standalone concept but was created as a co-branding vehicle that would be coupled with Blimpie Subs & Salads. Co-branding emerged as a hot growth vehicle in the late 1990s and involved the placement of two (or more) restaurant brands within a single unit. There were a number of rationales behind co-branded units, including the idea that the additional choices that they offered customers made them more attractive to groups of people, but for Blimpie International it was the desire to increase dinner revenues that propelled the creation of Pasta Central. Because sandwiches were largely considered lunch fare, Blimpie Subs outlets made the bulk of their sales from 11 a.m. to 2 p.m. Pasta Central, by contrast, with its Italian-style pasta dishes and its pizza offerings, was designed to generate a lot of traffic during dinner, thereby making it complementary to Blimpie. In addition, Pasta Central was also created with a home-meal-replacement component built in – a selection of prepared refrigerated and frozen entrees and prepacked foods for preparation at home. By mid-2001 there were eight units cobranded with Blimpie and Pasta Central, with the units located in Puerto Rico
Puerto Rico
Puerto Rico , officially the Commonwealth of Puerto Rico , is an unincorporated territory of the United States, located in the northeastern Caribbean, east of the Dominican Republic and west of both the United States Virgin Islands and the British Virgin Islands.Puerto Rico comprises an...
, Georgia
Georgia (country)
Georgia is a sovereign state in the Caucasus region of Eurasia. Located at the crossroads of Western Asia and Eastern Europe, it is bounded to the west by the Black Sea, to the north by Russia, to the southwest by Turkey, to the south by Armenia, and to the southeast by Azerbaijan. The capital of...
, South Carolina
South Carolina
South Carolina is a state in the Deep South of the United States that borders Georgia to the south, North Carolina to the north, and the Atlantic Ocean to the east. Originally part of the Province of Carolina, the Province of South Carolina was one of the 13 colonies that declared independence...
, Texas
Texas
Texas is the second largest U.S. state by both area and population, and the largest state by area in the contiguous United States.The name, based on the Caddo word "Tejas" meaning "friends" or "allies", was applied by the Spanish to the Caddo themselves and to the region of their settlement in...
, and Wyoming
Wyoming
Wyoming is a state in the mountain region of the Western United States. The western two thirds of the state is covered mostly with the mountain ranges and rangelands in the foothills of the Eastern Rocky Mountains, while the eastern third of the state is high elevation prairie known as the High...
.
A third new concept was 'Smoothie Island', which was launched through Maui Tacos in 1998. Smoothie Island's menu featured beverages blended with frozen yogurt and fruit. In addition to opening standalone units, including such nontraditional locations as airports, health clubs, and grocery stores, Blimpie also planned to co-brand Smoothie Island with both the Maui Tacos and Blimpie concepts—both in dual-branding and tri-branding formats. By mid-2001 there were 80 Smoothie Island units located in the United States, Puerto Rico, and four other countries.
By the turn of the 2000s, Blimpie International was struggling. Net income had fallen steadily throughout the second half of the 1990s. A main factor in this decline was that the subfranchiser rights to the Blimpie Subs chain had largely been sold by the mid-1990s, thus bringing a halt to what had been a steady stream of income. As Blimpie's struggles continued, investors showed little interest in the company, and the price of the company's stock sagged. Seeing little benefit in being a publicly traded firm, Blimpie joined the growing ranks of restaurant companies fleeing the public market. In October 2001 a private investor group led by Jeffrey K. Endervelt, owner of the 44-unit Blimpie of California subfranchise, agreed to buy Blimpie International for $25.7 million. The transaction was completed in January 2002, whereupon Endervelt took over as chairman, president, and chief executive officer, and Conza, who was a partner in the investor group, remained involved at the company but in an advisory capacity. Although Blimpie remained far behind Subway in the battle for hoagie supremacy, the new ownership and leadership perhaps signaled the beginning of a brighter era for Blimpie.