1. If you were in Kyle Vaughn’s position, which strategic option would you take? Explain your reasoning.
2. Comment on the decision to license the Hottie Hawg’s brand rather than enter into a franchise agreement with Seymour. In the company’s situation, is it better to promote easier expansion through franchising or maintain tight control over brand image through licensing? Explain.
3. Assume that Hottie Hawg’s is successful with the Aramark/Pepsi Center opportunity. What should Vaughn’s next move be to continue that growth and success?
4. If the Aramark/Pepsi Center opportunity turns out to be unsuccessful, what should Vaughn do to ensure the ongoing viability of Hottie Hawg’s?

In 2008, entrepreneurs Eric Rybka and Kyle Vaughn created Hottie Hawg’s Smokin’ BBQ after Rybka became impressed with Vaughn’s grilling techniques and meat preparation. When Rybka initially approached Vaughn about a partnership, there were no numbers or facts given—just a casual suggestion that the two should become partners in a new catering business. Their partnership agreement was simple: Rybka would provide the technical knowledge and support of the operation, while Vaughn would use his recipes and essentially create the brand image. The one thing Rybka and Vaughn knew immediately was that they wanted to incorporate women into the brand concept and do for BBQ what Hooter’s had done for wings. They decided that attractive waitresses would serve barbecue at events and parties from the outdoor kitchen on wheels. Tragically, Rybka died just as the company was getting off the ground. This left Vaughn with new equipment, minimal knowledge about the catering business, and a determination to make Hottie Hawg’s a success.

After initial growing pains, Hottie Hawg’s found success with the Billfish Tournament in Panama City, FL. The company was also fortunate to land free airtime on an Atlanta news program, an essentially free NASCAR sponsorship, and good social exposure via YouTube. Things began to get really interesting for Vaughn and Hottie Hawg’s after a successful licensing agreement with an old friend—Todd Seymour—in Denver, CO. This led to a potential deal with Aramark to become a vendor at Denver’s Pepsi Center. Although there was tremendous excitement about the opportunity and its unbelievable upside potential, Vaughn remained hesitant about the deal. For a variety of reasons, Hottie Hawg’s would have to establish a local commissary in Denver in order to accept the Aramark deal. Vaughn estimated $25,000 to $30,000 in initial setup fees for the commissary, including labor, equipment, the rental space, and the cost of licensing. However, Hottie Hawg’s would not be able to finance this expansion without an infusion of cash from ACT – Vaughn’s main business and source of livelihood.