In this FDD Talk 2015 post, you’ll learn the following:
- Section I – Background information on the Moe’s Southwest Grill franchise opportunity, including relevant news updates
- Section II – Estimated initial investment for a Moe’s Southwest Grill franchise, based on Item 7 of the company’s 2015 FDD
- Section III – Presentation and analysis of Moe’s Southwest Grill’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, Personnel Expenses, Advertising, Operating Expenses, Occupancy Expenses, General and Administrative Expenses, and EBITDA for franchised Restaurants open continuously for 3 or more years prior to the end of fiscal year 2014 and that provided Moe’s with complete financial information for the full fiscal year 2014
- 2014 Average Net Sales for the Top Quartile, 2nd Quartile, 3rd Quartile, and Bottom Quartile of the 367 franchised Restaurants that have been open continuously for 3 or more years prior to the end of Moe’s fiscal year 2014
Section I – Background Information
Steady growth led to Moe’s Southwest Grill opening more than one store per week in 2014 and its 600th store in 2015.
Moe’s opened 60 new restaurants in 2014, with new markets including Las Vegas, Philadelphia and Dallas. In 2015 the chain is targeting Minneapolis and St. Paul in Minnesota. Currently, Moe’s has a restaurant in the Minneapolis suburb of Bloomington, the home of the Mall of America, and plans are to expand further in the Twin Cities.
Moe’s Southwest Grill opened its 600th location in Layton, Utah, in April 2015. Amid increasing demand for fast-casual Mexican restaurants, the Atlanta-based chain expects continued growth, with multi-unit, multi-year deals signed in 2014 to open 12 new locations in Iowa; 18 in Sacramento and Santa Cruz, California; and 17 in Dallas.
A Healthier, More Inclusive Restaurant
The chain is still relatively young, started by Raving Brands in Atlanta, Georgia, in December 2000. Focus Brands, which owns Cinnabon and other companies, purchased Moe’s Southwest Grill in August 2007. Moe’s opened its first international location in 2011 in Turkey.
Moe’s is a winning bet for vegetarians, people with gluten sensitivities, and customers who want to order healthier meals. The chain advertises cage-free chicken, grass-fed beef and grain-fed pork, with no antibiotics, hormones or steroids, and offers tofu as a protein in its burritos and other menu items. The menu has many vegetarian selections and is 90 percent gluten-free, with no trans fats or MSG.
More than 20 fresh ingredients are prepared daily on location. Grilled vegetables and mushrooms are prepared separately from meat products on a different grill, and the stores use no microwaves.
Moe’s Southwest Grill’s pop-culture-inspired menu is anchored by the burrito line: Sriracha Nacho Burrito, Joey Bag of Donuts, The Homewrecker, and the vegetarian Art Vandalay. Junior Burritos are available on the Lite Options Menu at 370 to 403 calories. The Unanimous Decision Lite is a 280-calorie soft-shell taco with black beans, pico de gallo, lettuce and guacamole.
Customers Pick Moe’s as No. 1 Mexican Chain
Restaurant Business magazine ranked Moe’s the No. 1 Mexican food chain in 2015, as selected by consumers. Honors for Moe’s in 2014 saw the restaurant chain listed among QSR Magazine’s Best Franchise Deals, Fast Casual’s Top Movers and Shakers, and Nation’s Restaurant News’ Top 100 for U.S. chain system-wide food-service sales.
Moe’s Makes Digital, TV Push
Moe’s punched up its digital spending by 603 percent in April 2014 and launched a website and mobile site as part of its digital overhaul. The chain launched a digital ad campaign that ran from April 21 through June 1.
The chain also began its first major national TV ad campaign in April with a 30-second ad that ran from April 21 through May 18.
Instagram ‘Welcome to Moe’s’ Contest
The “Welcome to Moe’s!” greeting became an opportunity to have fun and win prizes in February 2014 when Moe’s invited customers to post Instagram pictures and videos expressing their own “Welcome to Moe’s.” Participants in the first Moe’s Rally Cry Instagram Campaign vied to win a $250 gift card.
Section II – Estimated Costs
- Please click here for detailed estimates of Moe’s Southwest Grill franchise costs, based on Item 7 of the company’s 2015 FDD (updated).