Jamba Juice is firing on all cylinders. Jamba Inc., parent to the smoothie chain, reported a $4.1 million profit for the third quarter (ended October 4) compared to a loss one year ago. Same-store sales systemwide increased 3.7 percent for the quarter, with a 3.3-percent increase at company-owned locations. It was the fourth consecutive quarter of positive sales growth for company-owned locations.
How has the smoothie chain been able to grow at a time when consumers are still reluctant to splurge? Simple…Jamba Juice is reinventing itself from being just another made-to-order smoothie chain into a healthy lifestyle brand. A recent Nation’s Restaurant News article highlights several company initiatives that have already resulted in sales increases across all four dayparts (To read the full article, please click here):
- Jamba Juice has expanded its food offerings, with the addition of steel-cut oatmeal, breakfast wrap sandwiches, hot-baked flatbreads, new-and-improved pastries and frozen yogurt. In the works are new menu items that will leverage the new TurboChef ovens now in about half of the chain’s locations. The new menu offerings have helped boost the chain’s attachment rate — the sale of food or snacks along with smoothies — to more than 20 percent this year, up from roughly 15 percent to 17 percent in 2009.
- Along with food, Jamba Juice has also been beefing up its beverage menu. In recent years, the chain has added more-healthful all-fruit options, lower-calorie and probiotic blends, a fruit & veggie line, and drinks made with trendy coconut water.
- Jamba has also been building its consumer products business, with offerings like make-at-home smoothies, energy drinks, juice blends and frozen novelties, which in 2012 is expected to generate about $3 million in revenue. Most recently, it signed an agreement with Bare Fruit LLC to create a new line of Jamba fruit chip snacks, which will be launched in stores before the end of this year.
- The company is testing a new smaller, express concept called JambaGo, which could help expand franchising opportunities as Jamba Juice moves into non-traditional locations like elementary and secondary schools and college campuses. Taking about the same space as a soda fountain beverage dispenser, the JambaGo model features the brand’s packaged products as well as the option of several pre-blended smoothies offered in a self-serve format.
For fiscal 2012, Jamba is projecting same-store sales growth of between 3 percent and 4 percent, along with the opening of 40 to 50 new domestic store locations and 10 to 15 new international locations, not including JambaGo outlets.
Frozen yogurt franchises can take a page from Jamba Juice’s diversification playbook since it’s getting much more difficult to find enduring success as a one-trick pony. For over 20 years, Jamba Juice has been the leading name in smoothies and fruit juices. But in order to grow and differentiate itself from competitors (both franchises and independents), Jamba Juice has been forced to reinvent itself and broaden its offerings.
Smoothie and frozen yogurt franchises are in the same boat in the sense that competing brands within each category offer practically identical products. That’s why I’ve been pushing frozen yogurt franchises to work on more innovation or, at least, greater product diversification. As the Jamba Juice experience shows, as a concept matures and becomes less of a novelty, franchisors will have to test other product categories to fuel further growth and keep the brand relevant.