Canada's Freshii plans tie-up with U.S. retailer in 60 days

BY AMRUTHA GAYATHRI AND SNEHA BANERJEE

Canadian fast-casual restaurant operator Freshii is planning to announce within the next two months a tie-up with a large U.S.-based retailer to open its eateries inside the retailer's stores.

The retailer has a "very sizeable real estate footprint and access to thousands of customers coming in everyday," Freshii Chief Executive Matthew Corrin said, but declined to provide details.

Corrin drew eyeballs last month with an open letter to McDonald's Corp (MCD.N) in which he urged the fast-food operator to co-brand a Freshii outlet. He promised that such a move would boost the outlet's same-store sales by 30 percent and its annual profit by $250,000.

"We have spoken to other fast-food giants and other big-box retailers and we will be announcing within the next 60 days our first roll out partner," Corrin told Reuters on Wednesday.

Corrin, 33, worked at the marketing department of fashion designer Oscar de la Renta in New York before moving back to Canada. He launched Freshii in 2005 after he found very few healthy and affordable eating options in the country.

Freshii, which offers wraps and quinoa bowls, and uses kale liberally in its salads, has become a household name in Canada with consumers increasingly looking for healthier eatout options.

Fast-casual chains such as Freshii are also wooing North Americans with their customizable menus and pocket-friendly prices. A string of U.S. fast-casual chains including Shake Shack Inc (SHAK.N) and El Pollo Loco Holdings Inc (LOCO.O) have listed their shares within the past year.

U.S.-based Noodles & Co (NDLS.O), which went public a couple of years earlier, said on Wednesday it would expand into Canada with its first restaurant in Toronto, scheduled to open next week.

Corrin said he was not currently looking to list Freshii on the public market and has no plans of selling the company either.

The company operates 160 restaurants in 13 countries including the United States and in Europe and the Middle East.

Freshii has been opening two restaurants every week on an average this year, and will continue that rate of expansion for the rest of the year, a company spokeswoman said.

Sales at Freshii in Canada rose nearly 28 percent last year to C$26 million ($21 million), versus an average 7.5 percent growth rate at Tim Hortons and McDonald's - the top two restaurant chains in the country - according to data from restaurant consultancy firm Technomic.