In this FDD Talk 2015 post, you’ll learn the following:
- Section I – Background information on the Jack in the Box franchise opportunity, including relevant news updates
- Section II – Estimated initial investment for a Jack in the Box franchise, based on Item 7 of the company’s 2015 FDD
- Section III – Presentation and analysis of Jack in the Box’s financial performance representations, based on Item 19 of the company’s 2015 FDD, including information on the:
- 2014 average sales, cost of sales, labor costs, advertising expenses, utilities, other operating costs, and operating margin before occupancy costs for franchised Jack in the Box restaurants with sales below $1 million; sales of $1 million to $1.25 million; sales of $1.25 million to $1.5 million; sales of $1.5 million to $1.75 million; sales of $1.75 million and above, respectively
- 2014 average sales, cost of sales, labor costs, advertising expenses, utilities, other operating costs, and operating margin before occupancy costs for the 1,667 franchised Jack in the Box restaurants in the continental United States that were in operation for more than 360 days within the twelve-month period ended September 28, 2014, and were operated by the same franchisee(s) for that entire period
Section I – Background Information
Jack in the Box is known for its innovative menu and for frequent experimentation with limited-time offers, some of which make it on the regular menu. The fast-food restaurant chain, which has a new president as of October 2014, continues to be creative not only with menu items but with campaigns as well. One might say Jack in the Box thinks outside the box.
Moves on the Munchie Meal
One of the most creative Jack in the Box additions is much more than just a meal. The restaurant’s late-night menu, introduced in 2013, continues to grow with the addition of two new Munchie Meals and the unveiling of a new game in September 2014 that caters to the night owls.
The game – Jack’s Munchie Peel – offered more than $1 million in food and other prizes; one in four entries was a winner. To play, late-night customers purchased a Munchie Meal after 9 p.m. and peeled the sticker off the box to reveal whether it was a winner. In addition to food prizes, customers could win Neff apparel, Fandango movie tickets, Southwest Airline flights, gas cards, custom-designed Jack in the Box snowboards, and music downloads.
Late-night diners were introduced to an expansion of the Munchie Meal line in June to include a Hella-Peno Burger (topped with a mess of both sliced and stuffed Jalapenos) and a Chick-N-Tater Melt (a fried chicken patty piled with bacon, hash browns, a three-cheese blend and ranch dressing, served on a buttery croissant).
The Munchie Meals – each of which is served with two regular tacos, Halfsies (a mix of french fries and curly fries) and a 20-ounce soft drink – are notable not only for their unique food fare but also because they are only available from 9 p.m. to 5 a.m., which drives late-night customers.
Jack in the Box came under new leadership on Oct. 27, 2014, when Frances Allen became president of the restaurant brand. Allen, formerly executive vice president and chief brand officer at Denny’s Corporation, has more than 30 years of branding and marketing experience. She has also had high-level leadership roles at Dunkin’ Brands, Sony Ericsson Mobile Communications, PepsiCo and Frito-Lay.
Lenny Comma, Jack in the Box Inc. chairman and CEO since January 2014, relinquished the title of president of the Jack in the Box brand, an office he had held since May 2012.
Honors for Jack in the Box
Burger Business, a website that covers fast-food restaurant news, named Jack in the Box Burger Chain of the Year in December. The honor was for its Munchie Meals and its limited-time promotions, highlighted by the Bacon Insider Burger, introduced in January 2014 for the Super Bowl. The popular burger mixed bacon pieces in with the beef.
Yahoo Finance named Jack in the Box Inc. its Restaurant Stock of the Year, partly on the strength of performance of the Jack in the Box chain through the year.
Jack in the Box was honored as a Regional Trailblazer by Univisions Communications Inc. and the NPD Group, for menu innovation and cultural connection with the Hispanic community through outreach and sponsorship of Hispanic-related events such as Fiestas Patrias and Cinco de Mayo.
First Airport Location
In December 2014, Jack in the Box aptly chose to launch its first airport restaurant in its home city of San Diego. The first location opened in the pre-security area of Lindbergh Field; a second Jack in the Box opened shortly thereafter in a post-security food court.
Three new breakfast items, Croissant Donuts and Meat Lovers and Grande Sausage Breakfast Burritos, were among the highlights of Jack in the Box’s menu additions in 2014. The burritos are the largest on the restaurant’s menu.
The first extension of the Jack in the Box Monster Taco lineup added two new flavors: Bacon Ranch and Nacho. (The original Monster Taco was added to the menu in October 2013 after previously being a limited-time item.)
Jack in the Box’s recent limited-time menu options include the Spicy Sriracha Burger, which was introduced in December and features Jalapenos and Sriracha sauce.
More Menu Innovation in 2015
2015 finds Jack in the Box with a couple new menu items: the Buttery Jack Burger in January and the Loaded Breakfast Sandwich in February. A quick look at the Jack in the Box website shows strong emphasis on these two menu items, along with the almost-new Spicy Sriracha Burger.
The website also prominently features a call to diners to use the hashtag #ButterBelieveIt to tweet about the Classic and Bacon & Swiss Buttery Jack Burger.
Section II – Estimated Costs
- Please click here for detailed estimates of Jack in the Box franchise costs, based on Item 7 of the company’s 2015 FDD.