QSR September 2022

BEST FRANCHI SE DEALS

RENEWAL FEE: $50,000 MARKETING FEE: 4 percent of sales TOTAL START-UP COSTS: $246,500–$2,162,500

Ability to setup drive-thru locations in unique spots with a small footprint and minimal staffing is appealing in the current market.” “The Human Bean is largely a western chain, working its way east, offering drive-thru espresso and coffee beverages. The company proudly sources its own coffee, with long-term relationships with coffee farmers, and encourages them to adopt sustainable growing methods. The company does not charge franchisees any ongoing percentage-of-sales royalty or marketing fees, earning its revenues instead from the sale of coffee and supplies to franchisees. In business since 1998 and franchising since 2002, the number of locations has risen over the past 10 years from 47 in 2011 to the current total of 121 (up from the previously reported total of 105) 13 are company-owned and all are located in the U.S.” THESKINNY: The separator for drive-thru coffee franchise The Human Bean is the aforementioned fact it doesn’t charge a percentage-of-sales royalty. The brand’s revenues stem from bulk sales of coffee and other sup plies ordered from its franchised locations. “The Human Bean realizes that as independent business owners, franchisees should be able to enjoy the many fruits of their labor while receiving the benefits of being part of The Human Bean franchise,” the company says. “Our goal is for Human Bean franchisees to enjoy the returns from their investment while receiving the benefits of being part of The Human Bean franchise.” The Human Bean serves a chocolate-covered espresso bean on top of every drink, and has earned a fervent following in its regional base. It supports four local giveback programs including, Coffee for a Cure, Mochas for Men, Food Drives, and Earth Day. “We are focused on human beans taking care of human beans,” the brand says. The Human Bean started in 1998 as a drive-thru espresso stand in Ashland, Oregon, and claims to have more than 300 stores open or under development in 25 states today. ChickenSalad Chick NUMBER OF U.S. FRANCHISE UNITS: 150 NUMBER OF U.S. TOTAL UNITS: 205 TOTAL SYSTEM-WIDE SALES: $255,000,000 FRANCHISE AVERAGE-UNIT VOLUME: $1,293,304 TOTAL AVERAGE-UNIT VOLUME: $1,404,812 (company owned) FRANCHISE FEE: $50,000 ROYALTY: 5 percent gross sales RENEWAL FEE: $3,500 FRANCHISEE INCENTIVES: Chicken Salad Chick has relationships with third-party sources which offer financing to those who qualify to cover the following: franchise fee, startup costs, equipment, inventory, accounts receivable, payroll. Chicken Salad Chick also provides a turn-key grand opening program with marketing and media planning for each restaurant, utilizing the $10,000 fee to support those efforts. SIZINGUPFROMTHESIDELINES: “Chicken Salad Chick turns in a star performance with an AUV of $1.3 million with a cost to build of less than a million. Sales in 2021 increased by 46 percent, showing that this brand’s growth is off the charts. They also benefit from a differentiated concept. They have no real rival in the chicken salad space despite many contenders in the fried chicken categories.” MARKETING FEE: $10,000 ( for grand opening) TOTAL START-UP COSTS: $742,300 - $980,300

SIZINGUPFROMTHESIDELINES: “Way ahead of the curve with a prime-time influencer/spokesperson relationship with Justin Bieber (will help the Canada to U.S. push in a big way). Third-largest coffee chain with serious name recog nition. As other coffee chains battle territory restrictions (due to growth which highlights the ongoing upside of the coffee space), Tim Hortons is positioned well to capitalize.” THESKINNY: As the Council suggests, one thing Tim Hortons doesn’t lack is name value. Parent company Restaurant Brands International CEO José Cil recently noted 80 percent of Canadians visit the brand every month. And the chain’s cult-favorite status? “It’s not a cult if every body likes it, right?” Cil told QSR . “… It’s as Canadian as the maple leaf and hockey.” While there’s no denying the brand’s hold in Canada (there are more than 3,900 locations), there remains plenty of growth opportunity stateside. At fewer than 640 stores, the U.S. map is wide open to Tim Hortons. This expansion will come with next-generation designs as well, which the company unveiled in early June. One is a 900-square-foot drive-thru-only model built to maximize efficiency and speed of service. The prototype is integrated with Tim Hortons’ app, meaning guests can easily order ahead, collect rewards points, and access weekly exclusive offers. The new store also features mobile order parking spots. The other prototype is a 1,600-square foot restaurant with 24 seats inside. As part of both designs, the menu is simpler, but with new items like refreshers and energy drinks, alongside mainstays such as Iced Capps, doughnuts, Timbits, break fast sandwiches, and Original Blend and Dark Roast coffee. More than 10 new model stores with a dining room have been built since 2020, and another 20-plus will debut before the end of 2022, the company says. Overall, the chain’s density in the U.S. is beginning to expand beyond its heavy presence in the Northeast and Upper Midwest. The brand recently signed a 30-unit deal for Houston and a 15-unit agreement in Atlanta. The Human Bean NUMBER OF U.S. FRANCHISE UNITS: 124 NUMBER OF U.S. TOTAL UNITS: 137 TOTAL SYSTEM-WIDE SALES: $108,883,844.34 FRANCHISE AVERAGE-UNIT VOLUME: $915,668 TOTAL AVERAGE-UNIT VOLUME: $916,432 FRANCHISE FEE: $30,000.00 ROYALTY: None RENEWAL FEE: $2,000 MARKETING FEE: 1 percent TOTAL START-UP COSTS: $386,350–$908,770 SIZINGUPFROMTHESIDELINES: “A unique model in several ways makes the brand differentiated to both franchisees and consumers. Having no royalties, while being transparent that brand revenue is generated through from coffee and supplies, potentially gives franchisees more margin control.

ONE THING TIM HORTONS DOESN’T LACK

IS NAME VALUE. 80 PERCENT OF CANADIANS VISIT THE BRAND EVERY MONTH.

“ ABILITY TO SETUP DRIVE-THRU

LOCATIONS IN UNIQUE SPOTS WITH A SMALL FOOTPRINT AND

MINIMAL STAFFING IS APPEALING IN THE CURRENT MARKET.”

GUILLOCHE BORDER: ADOBE STOCK / SAIFUL, THE HUMAN BEAN / COLBY WILLIAMS

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SEPTEMBER 2022 | QSR | www.qsrmagazine.com