Hogi Yogi Corp., which started in Orem seven years ago with a single store, is on the verge of breaking ground on a 12,000-square-foot corporate headquarters in the Riverwoods Commercial Park.
Dan Campbell, managing director of EsNet Management Group, said, "One of the objectives of EsNet is to partner with companies that are experiencing solid growth and momentum in their respective industries."Hogi Yogi certainly meets that criteria."
The groundbreaking is scheduled to take place this month with a grand opening planned for December.
The new facility will feature a training center/store for franchisees and offices for corporate employees. It will be one of 35 new Hogi Yogi stores opening in 1996, bringing the total to 95.
Gross sales for 1995 are estimated at $13 million, said Mike Clayton recently in an address to Brigham Young University Marriott School of Management accounting students.
Success has not come without lessons, said Clayton, who now has stores in Utah, Arizona, Idaho, Colorado, Nevada, Washington, Oregon, Maryland and Texas.
His first four stores were too far from one another, and a couple were in relatively poor locations, he said.
"We now have a model to use to help with site selection," said Clayton. "That would have helped us not choose some not-so-great locations."
In his West Valley store, he found the mall traffic he'd counted on "passed right by to the mall," and a bank was built directly in front of the store, effectively blocking visibility in an area where the average income of neighbors proved to be around $11,000.
"The stores were so far apart (in Logan, Orem, Sugar House and West Valley) and there was only me. We had no credit history, no experience in operations or marketing. It was interesting to try and get the products we wanted."
Clayton said it was his good fortune to meet an inventor with a machine that could take real yogurt and mix it without compromising the healthful element.
Originally he'd invested $12,000 in a soft-server that pumped in air and chemicals he didn't want in the yogurt.
He bought a bread mixer that failed to make the product he needed for the sandwich buns until eventually he discovered Hazel-wood Bakeries out of Missouri that made a breadstick dough he could adapt.
Along the journey, Clayton has relied on sticking to the store's mission statement to get him to a successful place. "That's why we don't sell french fries and doughnuts. "
He also gives a lot of credit to having a "memorable logo and name. As ridiculous as that name is, that's been a key. People remember us."
Being a dual-phase operation has paid off as well. "It gave us more market share to offer sandwiches and yogurts."
Clayton said part of the secret is to put together a management team who can work together and even argue with each other effectively. "I would not recommend hiring family or friends unless you're able to fire them," he said.
He told the audience it's essential to learn to account and pay the bills. "Never burn bridges," he advised.
Clayton said over the years he's "done everything" in the business from laying in the tile work and drawing up the very first floor plan to slicing meats and serving sandwiches.
He learned to automatically add to whatever timetable a contractor told him. "In the Orem store, we actually opened with the bubble still over the stucco," he recalled.
Clayton listed a few pointers for anyone starting up a new business:
- Stay out of debt.
- Get every contract in writing.
- Stay focused.
- Don't give out too many two-for-one cards.