Paul Schmidgall

fire & rice suspends fees to help franchisees recover

IN AN UNUSUAL MOvE, PAELLA CATERING FRANCHISOR FIRE & RICE ABATED ALL ROyALTy AND MARkETING FEES FOR ITS FRANCHISEES FOR 20 MONTHS.

Chef Paul Schmidgall is so devoted to the success of Fire & Rice franchisees that he decided they didn’t have to pay any royalty or marketing fees for 20 months of the pandemic.

Schmidgall is the founder of Fire & Rice, a Naples, Fla.-based catering company specializing in preparing paellas for corporate events, private parties, family reunions, farmers’ markets, festivals and other social gatherings. Entrepreneurs who buy a Fire & Rice franchise get everything they need, from a van or trailer to burners, recipes and utensils. When the pandemic shutdowns started in March 2020, Schmidgall unilaterally abated franchise fees, including 6% on gross sales, 1% for marketing and 1% for national advertising despite the fact that franchisees were contractually obligated to pay these fees. He reasoned that franchisees needed to save money to shore up their businesses as catering cratered. “I’m the relationship business, I’ll take the hit to help them survive,” he explains. The waiving of fees raised eyebrows in the industry. “We don’t know of any smaller franchisor that has forgiven fees for the entire duration of the pandemic,” says Tom Parks, president of Premier Franchise Solutions, which is handling franchise sales for the company. Franchisees say Schmidgall’s decision to abate fees was a welcome surprise. “We didn’t expect him to do that,” says Nick Neveau, a franchisee in Lansing, Mich. Indeed, there was no clause in the franchise documents that would allow a franchisee to stop paying fees in case of a major disaster such as a pandemic. “It helped us financially get through uncertain times, it was one of the line items I didn’t have to worry about,” Neveau says. “I was shocked,” says Annabelle Johnson, a Fire & Rice franchisee in Hilton Head, S.C. “It really reinforced to us what a good decision it was to be a Fire & Rice franchise because when things get tough, Paul stands behind you. It was very heartfelt and kind and generous. A lot of franchisors would not do that.”

The fee abatements allowed franchisees to survive the worst of the pandemic as food operations were considered essential businesses and Fire & Rice franchisees

were permitted to sell paella at open-air markets. They also provided pickup and delivery services while making plans for the return of private catering and special events.

For Neveau, the savings also meant he could plot his expansion to areas such as Sarasota, Fla., in the winter months when business in northern states slows. “We want to help Fire & Rice get more dots on the map and more locations on the back of our tee shirts,” he says. Fact is, community service is a big part of Fire & Rice’s growth strategy. Instead of paying a substantial marketing fee to the franchise company, Fire & Rice mandates franchisees to spend 5% of sales in their own markets. “I want to make sure they invest in their community,” says Schmidgall, noting that the franchise company survived on retained earnings. The cost to own a Fire & Rice franchise is $25,000 for the franchise fee and $30,000 to $70,000 depending on which package a franchisee selects. This includes equipment that includes a trailer or a van, the tent and all the supplies for a 100-person catered event. Fire & Rice also suggests franchisees have $20,000 to $25,000 in liquid assets. Fire & Rice chefs prepare the Spanish dish of rice, saffron, seafood and meats in a large shallow pan over an open flame using traditional ingredients and methods. Chefs arrive with all the equipment and utensils, preparing the meal in front of the guests.

about Fire & rice

fire & rice is a catering company specializing in preparing paellas for corporate events, private parties, family reunions, farmers’ markets, festivals and other social gatherings. fire & rice chefs prepare the spanish dish of rice, saffron, seafood and meats in a large shallow pan over an open flame using traditional ingredients and methods. chefs arrive with all the equipment and utensils, preparing the meal in front of the guests. headquartered in naples, fla., the company has expanded to fort myers and sarasota in florida and in michigan, minnesota and south carolina. for more information about acquiring a fire & rice franchise, fireandrice.us

For more information about acquiring a Fire & Rice franchise, contact Tom Parks, Premier Franchise Solutions, 517-763-3661, tparks@premierfb.com.