Schlotzsky's opens first Russia locationSchlotzsky's opens first Russia location

Even as tensions between Russia and the West grow and the nation’s ruble currency slides in value, U.S. restaurant brands continue to expand into the country.

Austin, Texas-based Schlotzsky’s, a division of Atlanta-based Focus Brands, opened its first restaurant in Russia on Nov. 10 in Moscow. Its master franchisee plans 50 more restaurants in seven former Soviet countries over the next 10 years, the company said.

“We are thrilled to expand the Schlotzsky’s footprint into the former Soviet countries and share our unique brand in this region,” Tony Pavese, president of Focus Brands International, said in a statement.

The Schlotzsky’s units are being developed by master franchisee Mehmet Akpinar, who owns Pegas Touristik, a large tour operator that serves Moscow and Antalya, Turkey, and who this year created Golden International Management Services Ltd.

“Schlotzsky’s is such a unique brand, and we are happy to finally have a presence in Russia,” Akpinar said in prepared remarks. Akpinar also has rights to develop the brand in Belarus, Estonia, Kazakhstan, Latvia, Lithuania and Ukraine.

Inside Schlotzsky's Moscow restaurant. Photo: Schlotzsky's

“Our customers love the food, and we’re already getting great feedback on the variety of Schlotzsky’s famous freshly-baked sourdough buns,” he said.

Akpinar reported that the new Schlotzsky’s unit, which opened in Moscow’s historic Kamergerskyi area, served more than 1,000 customers in its first week, despite declines in the ruble’s value against Western currencies.

The ruble has fallen more than 40 percent in 2014, pressured by U.S. and European economic sanctions after Russian President Vladimir Putin’s intervention in the Ukraine and a sharp drop in oil prices, which are a cornerstone of Russia’s economy.

Thomas Bartsch, chief marketing officer for Focus Brands International, said Schlotzsky’s has entered Russia with special offers to boost opening business and traffic in general.

“From a marketing perspective and to drive traffic [and] combat the ruble decline, we are executing traffic-driving value offers that include business lunch specials, breakfast combos, 50-percent off beer, as well as a daily promotion where a customer wins a free signature sandwich,” Bartsch said in response to emailed questions.

Schlotzsky’s has also added locally influenced items to its core menu of 15 signature sandwiches.

“From a food perspective, the draw is unique and differentiating — freshly baked sourdough buns, signature sandwiches, pizzas and salads,” Bartsch said.

Local items on the Russian menu include a tuna sandwich and a salmon sandwich, which Schlotzsky’s said are local favorites, and a side dish of hot potato wedges, the company said.

Schlotzsky’s, founded in 1971, has about 350 locations worldwide, including 36 in the U.S, as well as units in Azerbaijan and Turkey.

Focus Brands also handles overseas expansion for its other brands, which include Carvel Ice Cream, Cinnabon, Moe’s Southwest Grill, Auntie Anne’s Pretzels and McAlister’s Deli.

Contact Ron Ruggless at [email protected].
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