But more importantly, Kim wants to reinvigorate his franchisees’ profit margins that narrowed slightly in 2022, when the cost of goods sold soared.
On this day, Kim is throwing a party for his 90-person headquarters staff with a catered Mexican buffet. It’s OK to go rogue every now and then with less-healthy fare, he said. Under Kim’s direction, Smoothie King has aggressive plans to add 103 stores by the end of this year, boosting its U.S. store count to about 1,300. Smoothie King also has 300 units in Asia and the Caribbean – thanks in large part to Kim’s success as an international master franchisor.
“I just turned 65, and at some point, you either sell it or die,” said Kilburn, who lives in Prosper. “I figured I’d sell it before I died. I’ve got other things I want to do. I didn’t have any negative reasons to sell.” Hyojo took the company public on the Korean Stock Exchange in 1989, adding millions to his already considerable fortune. Kim was 16 at the time, but in his family’s thinking, his future was already sealed. He was dispatched to Boston University to join cousins there.
Kim now understands his father’s strident stance against debt stems from his extraordinarily hard times as a boy following the death of his father at the outset of the Korean War in 1950.“I’m like, ‘I’m not working for him. I’m better than what this guy is telling me to do. I’m not going to just sit here and do nothing,” Kim said. “I have my own dreams.”Kim left the company and went to the University of California-Irvine for his MBA during the high-tech startup craziness.
Instead, his father agreed to invest $5 million. Kim used half of that to open his two-story, 150-seat store on the main drag of Myeongdong, the Times Square of Seoul.But metropolitan Seoul accounts for about half of Korea’s nearly 52 million people and more than 200,000 pedestrians walk through its Myeongdong district every day.
His wife, Hosun, along with just about everyone else, urged Kim to go back to work for his father and live the well-to-do life of housekeepers and chauffeurs. They paid $50 million for the struggling franchisor, which had 70% of its stores up for sale. Kuhnau didn’t give them any chance for buyer’s remorse.
Sid Weigand, the largest D-FW franchisee with 13 units, introduced Smoothie King to the metroplex 25 years ago when he opened his first store on Texas Christian University’s campus. His executive team nearly mutinied a year after Kim took over and handed down his edict. They summoned Kim to the conference room and demanded that he reinstate their right to eat whatever they fancied.
He said the naming rights deal was meant to signal to franchisees that he didn’t buy Smoothie King as a private equity flip.