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Search Results for: chipotle

News: Quiznos, Chipotle, Fuddruckers, Pizza Fushion

Quiznos Quiznos renegotiated it’s debt load and took in an infusion of equity capital from JP Morgan and other existing shareholders.   You can read both good and bad into this.  The good being the investors saw enough upside to invest more, the bad being Quiznos desperately needed this to happen so their financial soundness probably isn’t strong. Chipotle Chipotle still showing a growing customer base with 1st quarter same-store sales up 4.3%.  They plan to open a new store every three days in 2010. Fuddruckers Fuddruckers filed for bankruptcy a few weeks ago.   It received approval to sell 62 Fuddruckers and a dozen Koo Koo Roo (similar to Boston Market) for $65 million.  It also plans to close 20 restaurants with “lease issues or low-foot traffic” stores.  Sales were down 10% in 2009. I woudn’t consider Fuddruckers part of the “better burger” craze of Five Guys and Counter, the brand is simply too old and retail square footage is way too large.  Red Robin’s are large in size too, but it invested plenty of capital in marketing and bradning to keep its brand appealing to the next generation of customers…much more so than Fuddruckers. Pizza Fusion Plans to offset its entire “carbon footprint” by paying a percentage of sales to a company to construct renewable energy facilities.

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Pie Five – closes locations and is reportedly struggling

Top your own pizza prepared “Chipotle Style” is a great concept and is hear to stay. However, Pie Five, a big player in the space from RAVE Restaurant Group (formerly named Pizza Inn), is having trouble. Two locations in Colorado Springs closed within a year of opening. Franchisees closed locations in Chicago and Minnesota, too. The franchisor closed 10% of its company-owned stores this year. The lower-than-expected sales and repeat visits were blamed on the brand and store design, with franchisees claiming it was tough to stand out in a crowded pizza market. They also accused the franchisor of misrepresenting sales numbers. One franchisee that owns 7 locations in the midwest is suing the franchisor, for misrepresentations. A big thorn is this: …the suit claims Pie Five’s food supplier, Performance Food Group, doesn’t provide fair pricing to franchisees. According to NRN, Pie Five collects a 2.5 percent rebate on food that Performance sells to its franchisees. Ouch!  That adds up when you are barely breaking even and you can’t reduce your food costs. Frankly, I’m a bit surprised at Pie Five. They started off strong. The store style was nice and modern, but the final pizza quality was lacking. Just about everyone I knew that ate there said is no better than “average” with somewhat dry crust, and that won’t inspire repeat visits or groups spending $8 a person for pizza. With foodies experiencing hand-crafted Neapolitan style pizza using the delicate ’00’ flour, you gotta up your game Pie Five. Blaze Pizza has the makings of a winner in this category, excellent product and excellent dough, despite the baking method that depends on an attentive pizza attendant with long peel.  

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How Quickly the Franchise Segments Fill Up – ShopHouse, Pei Wei

Chipotle’s new fast mexican asian concept dubbed ShopHouse has only been open a few months in Washington DC. Their menu consists of Banh Mi sandwiches and rice or noodle bowls with meats. The reviews on Yelp vary, with an average of 3 out of 5 stars. On the negative side, comments seem to congregate on the odd combinations of tastes, blandness, and unlikable slaw on too many items. On the positive side, employee helpfulness and value seem to rank high. Many restaurant groups are pursuing this market – Wagamama, Big Bowl, Stir Crazy, Panda Express (and all the indoor mall food court offerings), and Pick up Stix. Technomic claims that sales at limited-service Asian restaurants grew 5.9% in 2010, faster than any other menu category, and in 2011 sales at Asian dining spots are expected to rise 5% compared to 4% for all limited-service restaurants. If you’re a CEO of a restaurant group looking to ride the trends, this is your new market. P.F. Chang’s, who also owns the popular casual restaurant Pei Wei, is creating a “more casual” concept called Pei Wei Asian Market, to compete in this fast service segment. It won’t be the notorious scoop style forged by Panda Express and Chipotle, but what they call a diner style with no table service. It sounds like the same style of Panera Bread but with a few more ready-to-eat packages at checkout. The fast asian fusion segment seems to be one that will have staying power. I like the segment, and there is a place for the Panera of Asian food, a speedy and quality layer above Panda Express. Just like Chipotle forged Mexican cuisine into the weekly rotation of American lunches, the arguably healthy fast asian fusion will also continue to grow and improve. — Franchising …

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Better Burger Trend Peaking?

Elevation Burger, the well branded organic better-burger franchise, closed it’s Baltimore franchise.  Reviews were pretty bad. As a whole, healthy, all-natural, and organic concepts have been having a hard time making their sales goals,  except for notable exceptions like Chipotle.  Everybody says they’ll go for healthy options, right? You have to watch what people do and not what they say.  I’m sure most people reading this post would say during a focus group, “Yes, I’ll pay a little premium for the organic meal”.  But, in reality what do you do?   Most of the time you purchase based on convenience, taste and price as long as you deem the quality above an acceptable level.  I was reminded of this recently from a PepsiCo executive.  Chipotle is the rare bird – it succeeds because it tastes good, is priced competitively, the line moves very fast, and most people don’t even realize the food is mostly organic. Another “healthy” brand to watch is Naked Pizza because it has signed several area development agreements for hundreds of units but lacks experienced management. A reviewer on Yelp stated, the “cheese was rubbery and the pizza was cardboard” – ouch! Naked Pizza has gathered remarkable attention for only having a single location.  The buzz is the result of winning an open venture funding call in a blog post from billionaire Mark Cuban.  It’s also reknowned for embracing of twitter (a billboard simply lists it’s twitter address).  A recent article summarizes the Naked Pizza idea: NakedPizza’s solution is an all-natural, fortified pizza, made with simple, unprocessed ingredients, informed by science and made affordable and available through the proven carry-out and delivery model. It’s signature difference is a crust made with a diverse blend of “ancestral” whole grains, seeds and beans fortified with prebiotic fiber and probiotics (live, …

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Healthiest Fast Food Restaurants

U.S. News & World Reports takes a stab at listing the healthiest fast food restaurants.  Panera Bread Jason’s Deli Au Bon Pain Noodles & Company Corner Bakery Chipotle Atlanta Bread Company McDonald’s Einstein Bagel Bros. Taco Del Mar  Implyign that everything on the menu is “healthy” is decieving.  For example, a single burrito at Chipotle is likely to have 1,500 calories. 

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McDonald’s chickens out on Boston Market

The Boston Business Journal reported today that Boston Market, co-created by Boston-based franchise guru George Nadaff, is being sold to Sun Capital Partners Inc.McDonald’s Corp., the Illinois fast-food giant that owns Boston Market, is selling the franchise to the Florida buyout firm to focus on hamburgers. As of June 30, 2007, Boston Market’s total assets and total liabilities were $180 million and $89.1 million, respectively, according to Securities and Exchange Commission filings. Boston Market currently has 630 locations in 28 states. In early August 2007, McDonald’s (NYSE: MCD) signed a definitive agreement for the sale of Boston Market. The company expects to complete the transaction in the third quarter 2007 and does not expect to record a loss. McDonald’s acquired Boston Market’s operations for $176.2 million in May 2000. Since then, McDonald’s has pared down its partner brands, shedding Chipotle Mexican Grill (CMGB), Donato’s Pizza and its stake in Fazoli’s Italian fast-food restaurants. “It was more a distraction than anything,” Morningstar analyst John Owens said of Boston Market. “McDonald’s is really singularly focused on the Golden Arches, so this was not a surprise to me.” Sun Capital, which now owns Fazoli’s, has a portfolio that also includes bakery chain Bruegger’s Enterprises, Garden Fresh salad restaurants and cheese-and-meat retailer Hickory Farms. Two years earlier, Boston Market had run out of cash to pay creditors and filed for Chapter 11 bankruptcy protection. Boston Market Corp., founded as Boston Chicken in 1985, expanded under the wing of franchise specialist Nadaff, who partnered with the founders in 1989. Cross Posted at: Let’s Talk Franchising

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Factors Affecting Profit

Chipotle Serves Up Hot Earnings Growth, But Buffalo Wild Wings’ Sales Are Light Buffalo Wild Wings same-store sales grew 8.1% at company-owned restaurants and 4% at franchised units. … Both companies face some thorny challenges moving forward, including rising food costs. Demand for ethanol has pushed up corn prices, which in turn has fattened the cost of restaurant staples such as chicken, beef and produce. Cost pressure is not a huge issue for Buffalo Wild Wings this year because it locked in a favorable deal with its chicken-wing supplier in March. Analyst Will Hamilton of SMH Capital estimates the company is paying about 30 cents a pound less than the current market price. But that price is expected to go up when the current contract expires. “The supplier will likely want a higher price,” said Hamilton, whose employer makes a market in Buffalo Wild Wings. “That’s a risk not quite factored in to the stock price right now.” Another wild card is how consumer skittishness might impact Buffalo’s same-store sales in the second half of 2007. “I have a general concern about the consumer as gas and other prices go up,” Hamilton said. “Comps will still be positive, but the growth could be slower.”

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Tim Hortons is Going Public in Canada

Tim Horton’s, a 2,885 upscale coffee and donut outlet, is entering the public capital markets of Canada. The reporter characterized the IPO as “destined to go down as the most popular IPO this country has seen to date” and “The frenzy around this doughnut deal is putting Google to shame”. Is the author over embellishing? Tim Horton’s IPO buzz seems to be more in line with fellow Chipotle’s enthusiastic IPO, not the crazed delirium over Google’s IPO. Is going public good for franchisees? I haven’t explored arguments on both sides, but my initial impression is no. The pressure to increase margins, meet analyst expectations, and pay for the increasing regulatory costs is going to increase the pressure for franchisors to squeeze more money and profit from their relationships with franchisees.

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More calories in a smoothie than a double cheeseburger?

New smoothie franchises seem to be opening as fast as Starbucks and now Chipotle’s. Unlike coffee, a “smoothie” is not a staple of the American palate and never will be. Nonetheless, the smoothie business has been hot lately with the likes of Jamba Juice (who reinvented the market), Smoothie King, Maui Wowi, and Planet Smoothie dominating the marketplace. They’ve been riding the omnipresent “health” wave by using tasty fruits and vegetables and vitamin powders in their potions. But how long will smoothies be perceived as healthy? You should be asking that question if you are thinking of buying a smoothie franchise. Just as financial markets always returning to the equilibrium, so do businesses. Eventually the product will commoditize, the market will saturate, and prices will drop (See the sub sandwich market). The process can be accelerated by negative news, just as the low carb movement (which I followed for a while) subsided. For example, if the national spotlight continues to highlight the high calorie count of smoothies defeating the impression of a healthy alternative to fast food, same store sales will suffer leaving smoothie franchisees with a lot of silent blenders. It’s already happening in the United Kingdom. Mississippi’s The Sun Herald reports: Thinking of ordering a smoothie for a healthful light snack between meals? Although these sweet fruity treats can be low in fat and rich in vitamins and nutrients, such as calcium and vitamin C, they can have a lot of sugar and calories. For example, a medium-sized Citrus Squeeze from smoothie chain Jamba Juice packs about five times as much sugar (103 grams) as a regular-sized Hershey’s milk chocolate bar (22 grams). It has 470 calories – more than a McDonald’s double cheeseburger (460 calories). Instead, try a lower-calorie smoothie option like of one of Jamba’s …

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Franchisor Mentions

VERY OUT OF DATE.  Do a search instead.  This was manually updated March 21, 2006 Companies Mentioned in Posts (likely incomplete):Automotive 1-800 RADIATORS Oil Butler Lube N’ Go On-Site-Lube Business & Home Services 1-800-WATER-DAMAGE Bartercard Garagetek Help-U-Sell Home Instead Homewatch Caregivers My Girl Friday PropertyGuys.com Sears Carpet & Upholstery Tax Centers of America Cleaning & Maintenance none Computer & Internet (some are listed in “Retail”) Screenz Food and Restaurant Arby’s Auntie Anne’s Blimpies Cheeburger Cheeburger Chipotle Dippin’ Dots Dream Dinners Doc Green’s Gourmet Salad Dominic’s of New York The Dugout Durango Grill Fazoli’s Fire of Brazil Fogo de Chao Goldstar Chili Jamba Juice Jerq’zine Krispy Kream Lenny’s Sub Shops Mauwi Wauwi Original Hamburger Stand Panaderia Taza Papa John’s Pizza Factory Pizza Patron Pretzel Time Quiznos Red Rock Chili San Francisco Soup Co Shane’s Rib Shack Skyline Chili Smoothie King Smotthie Planet Soup Nazi Steak-out Subway Submarina Sub Station II Super Suppers The Soup Box Supercuts Suzanne’s Kitchen We’re Rolling Pretzel Company Wetzel’s Pretzels Z Pizza Zoup! Fresh Soup Co (List all sub franchises) Health & Fitness Curves Liberty Fitness Home Building & Repair Services See “Business and Home Services” above Personnel & Staffing none Pet Retail and Services Camp Bow Wow Doody Calls The Pet Pantry Wag My Tail Interquest Detection Canines Pets Are Inn Retail Franchises Ace Hardware AuctionDrop Battery Plus Best Cuts GNC Educational Outfitters Fantastic Sams Fastframe Foot Solutions Friendly Computers Geeks on Call GNC Hair Cuttery Herman’s World of Sports Imagine This Sold Orbit Drop Play It Again Sports QuikDrop Roosters Men’s Grooming Centers Screenz Snips Its Sports Clips Stone Mountain Carpet Mill Tom’s Foods We the People Categories: eBay drop offs (generally) Hair Travel & Hotel none Industry Lists & Research 2004 Same Store Sales Growth of QSRs (quick service restaurants) Royalty and Advertising …

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