Fondue franchise on pace to open 100th location

Intrigued by the growth of population and household income in the Reno area, a Florida company that franchises fondue restaurants designated northern Nevada as one of its top 10 target markets for the year.

The Melting Pot, a company based at Tampa, operates 88 company-owned and franchised locations, predominately in the eastern half of the United States.

As it scouts for new locations, The Melting Pot takes a close look at population and income numbers, said David Sieg, a spokesman for the company.

When it ran the numbers for the Reno area, the company saw that household income in the area grew more than 29 percent during the 1990s and per-capita income was up 46 percent.

The income figures are important because The Melting Pot positions itself as an upscale restaurant.

The average ticket, Sieg said, is about $40 a person.

The Melting Pot is a dinner-only restaurant.

The restaurants typically are located in middle- to upper-income areas, and franchise owners lease 5,000 to 6,000 square feet.

The company estimates that franchise owners invest $200,000 to $250,000 of their own money in a new restaurant, and the total investment in new locations adds another $600,000 to $1 million.

The franchise fee runs $35,000 along with a monthly royalty equal to 4.5 percent of gross sales.

Almost always, those investments come from entrepreneurs who live in the same cities as their restaurants, Sieg said.

"We don't sell multiple franchises to big LLCs," he said.

Much of the interest from potential purchasers of franchises, he said, comes from customers at The Melting Pot restaurants.

Each location employs about 50 to 60 workers but no chef.

That's because much of the cooking takes place at the tables themselves.

While fondue has enjoyed a recent resurgence, The Melting Pot traces its roots to the big fondue boom 30 years ago.

It was launched in a four-table restaurant near Orlando that featured a limited menu of cheese and beef fondue.

After a cautious entry into franchising from the early 1980s and slow growth until 1995, The Melting Pot opened 10 restaurants a year from 2001-2003, opened 16 in 2004 and is on pace this year to open its 100th location.

One of those locations operates in Las Vegas, and nine are open or under development in California.

The company currently has more than 35 locations under development nationwide, Sieg said.

Along with Reno, the list of target markets ranges from Albany, N.Y.

and New Haven, Conn., to Birmingham,Ala.