In this FDD Talk 2015 post, you’ll learn the following:
- Section I – Background information on the Elevation Burger franchise opportunity, including relevant news updates
- Section II – Estimated initial investment for an Elevation Burger franchise, based on Item 7 of the company’s 2015 FDD
- Section III – Presentation and analysis of Elevation Burger’s financial performance representations, based on Item 19 of the company’s 2015 FDD, including information on the:
- 2014 average gross sales, cost of goods sold, payroll, rent, general and administrative expenses, marketing expenses, and EBITDA for the two Elevation Burger restaurants that were operated by the franchisor’s affiliates for the full calendar year of 2014
Section I – Background Information
Elevation Burger, which calls itself the largest American restaurant seller of organic beef, is aiming for the same status with organic chicken.
The fast-casual chain announced in April 2015 that it would start to sell organic chicken products in all of its approximately 50 locations. Menu additions would include items such as grilled chicken sandwiches, grilled chicken breast tenderloins and adds-ons of chicken in the restaurants’ salads. Elevation Burger also plans some limited-time offerings involving chicken.
The chicken, certified organic by the USDA, is raised in open pastures. Cuisine Solutions, a local business based in the Elevation Burger headquarters of Alexandria, Virginia, will provide pre-cooked chicken breasts prepared in the sous-vide method, which slow-cooks food in sealed bags in water baths at precise temperatures. Restaurants will finish the chicken breasts on their grills.
“The fact that Elevation Burger worked with a company the size of Cuisine Solutions to help them gain organic certification is huge,” Laura Batcha, executive director of the Organic Trade Association, said in a news release. “The organic label is one of the most trusted food labels, but going organic isn’t easy.”
Hess Sought to ‘Elevate’ Food
Elevation Burger was started in 2005 in Falls Church, Virginia, by Hans Hess, who sought to “elevate” burgers and fries to another level. Today the chain has more than 50 locations in the U.S. as well as in Bahrain, Kuwait, Qatar, Saudi Arabia and the United Arab Emirates.
Burgers are made from organic, grass-fed, free-range beef that is ground in the restaurants. The chain offers burger choices with less fat and fewer calories. Patties are hand-formed, and the cheese used is cheddar that has been aged for six months. The beef is designated halal, which means it meets the standards of preparation for Muslim diners.
The vegetarian and vegan burgers are made from organic grains and vegetables and are prepared in a conveyor, separate from the griddle where the beef patties are cooked. Customers can opt for a lettuce wrap for their burgers instead of a bun.
French fries are prepared in olive oil in a two-step method developed by Hess, and malts and shakes use hand-scooped ice cream. Food is cooked in an open kitchen that is viewable by customers.
Chain is Environmentally Friendly
Along with its organic and humane food practices, the chain is environmentally friendly. It recycles its oil into biodiesel fuel, uses sustainable materials and installs energy-efficient equipment into its stores. The decor in the restaurants is made from bamboo and recycled materials. Most of the restaurants’ buildings are LEED-certified.
Alitzer named CEO
Rick Altizer was named the new CEO of Elevation Burger in March 2014. Altizer replaces founder Hans Hess, who moved into the role of chairman of the board. Hess will focus on recruiting experienced board members to help move Elevation Burger forward.
Alitzer, who has had leadership roles with Shell Oil, Midas International and Jiffy Lube, spent 14 years with McDonald’s, for whom he served as a regional vice president and general manager, running a region with 500 stores.
New LTO Burger Added
Elevation Burger added a limited-time Barbecue Bacon Cheddar Burger at 32 locations in August 2014 featuring two organic beef patties, melted aged cheese, organic bacon, caramelized onions and Simply Heinz Barbecue Sauce. The burger was the chain’s first addition to the menu in five years.
Section II – Estimated Costs
- Please click here for detailed estimates of Elevation Burger franchise costs, based on Item 7 of the company’s 2015 FDD (updated).