Exclusive: Southwest Brands looks to sell Keva Juice, Garduño’s

Keva Juice and Garduño’s are about to enter a new era as their owner looks to sell the longtime New Mexico brands.

The decision to sell comes after months of consideration by 65-year-old Tug Herig, president of Southwest Brands, which owns the two labels.

“I just decided after 18 years of running this company, it’s time for me to move on and retire,” Herig said in an interview.

Southwest Brands, an Albuquerque-based group of investors, bought Keva Juice’s corporate stores and brand rights in 2007 and later purchased its remaining New Mexico franchises, according to Southwest Brands. It did so under the name Keva Juice Southwest LLC, a newly formed entity at the time. The company became Southwest Brands after it purchased Garduño’s in 2011; it does not operate the Garduño’s restaurants today but instead licenses the brand to operators.

Keva Juice and Garduño’s are the only two brands that Southwest Brands controls and oversees, so after they are sold, Southwest Brands will dissolve.

Herig said he is looking to hear from interested buyers or investors immediately, and the price of the brands will be determined by the market.

“The brands are New Mexico brands — they’ve got a solid foundation, they’ve got great reputations and they’ve got an incredible following, so we’re just going to let the market determine that,” Herig said.

Keva Juice, a smoothie retailer, was established in New Mexico in 1998 after businessman Ray Blake and his son Scott Blake conceptualized the brand in Utah a couple years prior. The business has close to a dozen locations in Albuquerque and Las Cruces. There are other locations in Colorado, Tennessee, Arizona, Texas and Utah, according to Keva Juice’s website, but Southwest Brands only owns the New Mexico locations.

Garduño’s restaurants, a Mexican- and New Mexican-style restaurant chain, was founded in 1981. But the Garduño family started the venture long before then, opening up their first establishment in 1969, according to Southwest Brands. When faced with bankruptcy in 2011, partly due to the economy and a divorce between the founders, the chain closed three of its five locations. The remaining two are still operational, in addition to a third location that opened at Native Lodge just two weeks ago.

The ideal buyer or investor, of both brands or just one, is someone who has “a sense of New Mexico pride” and the ability to continue expanding the brands, Herig said.

“I think the brands right now are at a level where they need to take the next step,” he said. “I think someone that has that energy level to bring (the brands) to the next level is going to be really critical.”

Herig said his company has developed a concept for Keva Juice’s expansion, involving a transportable drive-up and walk-up container store that can be built off site, moved via a trailer and dropped off wherever the company leases land.

“We’ve got the plans drawn and everything, and that’s ready to expand into what I call small-town New Mexico,” Herig said. “(Small towns) are always contacting me, saying they want a Keva Juice. I just haven’t had the bandwidth to go there.”

The mobility of the unit would allow the company to test out different markets and expand in markets that the unit is successful in, while avoiding getting stuck if the unit is not successful. Southwest Brands has also begun refreshing the smoothie brand with a new look, logo and color palette at four of the local stores so far.

Jim Long, founder and CEO of Heritage Cos. and a major shareholder of Southwest Brands, said Keva Juice offers a straightforward owner and operator deal for someone who “wants to grow and expand a business, especially one with great brand equity.”

Garduño’s, on the other hand, offers a different opportunity that could attract three types of buyers: an owner and operator; a product buyer who produces merchandise, such as the restaurant’s chips and salsa; or a passive investor who is more interested in “the royalty income stream of the business,” Long said.

The agreement and transition period could take time, Herig said, but he will help with the transition as long as needed to make it a smooth one. He said the brands’ employees and customers will hopefully reap the benefits of future growth as a result of the sale.

Herig said he’s looking forward to seeing that growth and reflecting back on the part he has played in growing the two brands.

“New Mexicans are proud of their brands. Keva Juice — I remember taking my kids there when they were young. My grandkids are going there now,” Herig said. “It’s a generational brand, as is Garduño’s, and I’m excited to have been part of that growth, but I also see that it continues to go into the future with additional generations.”