(Atlanta, GA) - After a decade of owning bars around the Southeast, Martin Sprock decided to find a business that promoted a healthier lifestyle and didn’t keep him out quite so late.

"I wanted something fun and different," Sprock said.

So he settled on smoothies, the healthful frozen fruit drinks known in the marketplace for their funky names, bright colors and nutritional supplements, including energy boosters and fat burners. The $4 drinks are often named after people, movies and flavors: Angel Food [editor’s mistake] and Frozen Goat, for example.

Four years after setting up shop, Sprock’s Planet Smoothie chain has 60 locations operating around the country, primarily in strip malls, including 22 in Atlanta. The company has 42 sites under construction in the United States, London, and [Singapore], and agreements for an additional 150 around the world.

It’s setting itself up as one of the major players in the smoothie market, which is estimated to reach $1 billion in revenue by the end of this year. Sprock expects his company to have about $30 million in revenue by the end of 1999 and about 175 locations operating by 2000.

Planet Smoothie has been profitable for about a month and a half, Sprock said, and will soon be debt-free.

"It’s a simple business to operate if you own our tools," he said.

But it’s hard work, he added. "It’s like bartending during the day, without tips."

He chose to open his own company after deciding that franchise agreements with other companies were too restrictive, he said.

"We think we’re in the right movement. We’re innovative," he said. "In 10 years, we want to be larger than Strarbucks."

Dan Titus, president of Juice Gallery, an industry publishing and research company, said the smoothie industry has room to grow.

"It took 40 years for the burger industry to saturate," he said. "This is the very beginning."

Smoothie Players

Planet Smoothie’s major competitor in the Atlanta market is Kenner, La.-based Smoothie King, with 28 locations in tthe metro area. Atlanta-based Freshens Premium Products also has become a major force in the smoothie business because of its presence in malls, hospitals and college campuses around the country. It has 21 Atlanta area locations.

But many of the smoothie players are based out West, including San Francisco-based Jamba Juice. Zuka is reportedly looking at sites in the Atlanta market.

So is Fort Lauderdale-based Power Smoothie, which is negotiating a deal for several Atlanta locations that will open in 1999. Power Smoothie stores average 1,100 square feet and carry not only smoothies, but also fresh juices, wrap sandwiches, veggie burgers and salads. The company has 13 locations, in Florida, Nevada and Texas.

Franchising Flow

Sprock opened his first Planet Smoothie in Buckhead in 1995 after only about six months of planning and a $100,000 investment. He had eight company-owned Atlanta locations by the time of the Olympic Games in 1996.

He and his partners began offering licensing agreements, giving others the right to open stores using the Planet Smoothie name in return for a fee, but later Sprock and his partners began franchising to have greater control over the stores.

Sprock said many of the franchisees have discovered the company on the Internet. The total cost of a new Planet Smoothie franchise is $110,000 [remember, this was written in February] for a location between 700 square feet and 1,200 square feet.

For Planet Smoothie, surviving the competition involves introducing new products in an attempt to position itself as a health food store, as well as a smoothie player. It is testing wrap sandwiches at several stores and will introduce hot soups fortified with nutritional supplements later this year.

Untasted market

While Planet Smoothie increases its market share around the country, its bigger rival, Smoothie King, is boosting its presence in Atlanta.

The 25-year-old company, which is considered the pioneer of mass-market smoothies, now has 194 franchise locations, mostly in the Southeast, including 28 locations in the Atlanta area. Richard Leveille, vice president of franchise development, said the company will probably open about 25 additional stores in Atlanta over the next three years.

Its first location here, only its 30th overall, opened in 1992. It was one of Atlantans’ first smoothie experiences.

"There is no doubt in my mind that the smoothie market is still in its infancy," Leveille said. "Only two or three [of every 10 people] has ever had a smoothie."

Leveille said Planet Smoothie and others have copied its concept. But while many competitors are adding menu items to diversify, Smoothie King remains true to smoothies. Its stores, which average about 1,200 square feet in strip malls, also sell vitamins and minerals.

Leveille said the competition hasn’t hurt - in fact, it may have helped.

"Planet Smoothie increased the awareness of a smoothie," Leveille said.

Freshens and Fields

Sprock, though, predicted there will be a shakeout eventually, and that only a handful of the more than 100 smoothie company owners in the country will remain.

"We see ourselves as the leader," he said.

Another competitor, Freshens, is coping by taking its smoothies to targeted markets - hospitals, college campuses and sports arenas.

Freshens is expanding by forming partnerships with established operators. It signed an agreement last year to co-brand with Salt Lake City-based Mrs. Fields Original Cookies in malls around the country. Ed Redmond, Freshens senior vice president, said the company will open 100 locations in 2000. It is planning to open a total of 300 smoothie locations around the country this year.

"We’ve seen strong incremental sales wherever we put in a smoothie and the host has decided to move forward our program," Redmond added.

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