Famous Dave’s appoints franchisee to board of directors

Minnesota-based restaurant chain Famous Dave’s has added a franchisee to its board of directors, a move uncommon in the industry.

Franchisee Anand Gala, who owns 11 Famous Dave’s locations in California, will join the barbecue chain’s board, which has seen three of its six board members resign in the last month after investment group Wexford Capital took over the company.

A franchisee perspective should be welcome on the company’s board. Franchisees own 134 of the chain’s 184 restaurants, and franchised units have been outperforming corporate stores. In the company’s first quarter franchisees’ same-store sales decreased – but only by 0.1 percent – while corporate same-store sales fell 4.9 percent. The company recently admitted that changes it made to its portions, plateware, and menu have hurt results.

As Nation’s Restaurant News noted, this type of move is “extremely rare.” It is not unheard of for chains to appoint franchisees as executives – a few years ago Burger King hired a franchisee as its North American president. But it is unusual for a franchisee to serve on a company’s board.

In fact, many large fast food companies have boards of directors that do not have any franchisee representation. McDonald’s board, in particular, was recently criticized for its “dinosaur” and “tight-knit” culture, which stems in part from the fact that many of the directors come from Chicago’s business community and had a direct connection to another board member before joining.