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FDD Talk 2016: The Melting Pot Franchise Opportunity (Financial Performance Analysis, Estimated Costs, and Other Important Stuff You Need to Know)

by Franchise Chatter on October 11, 2016

in FDD Talk 2017: Food Franchises, Franchise Earnings, Restaurant Franchise



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The Melting Pot Restaurant Photo by Frank Kehren

In this FDD Talk 2016 post, you’ll learn the following:

  • Section I – Background information on The Melting Pot franchise opportunity, including relevant news updates
  • Section II – Estimated initial investment for a The Melting Pot franchise, based on Item 7 of the company’s 2016 FDD
  • Section III – Presentation and analysis of The Melting Pot’s financial performance representations, based on Item 19 of the company’s 2016 FDD, including information on the:
  • 2015 average sales, guest count, sales per guest, and cost of sales percentage for 2 company-owned The Melting Pot Restaurants in the United States that were open a full 12 months ending fiscal year March 31, 2016
  • 2015 average sales, guest count, sales per guest, and cost of sales percentage for 116 franchised The Melting Pot Restaurants in the United States that were open a full 12 months ending fiscal year March 31, 2016
  • 2015 average sales, guest count, sales per guest, and cost of sales percentage for 19 franchised The Melting Pot Restaurants in the West region, 18 in the Midwest region, 26 in the Northeast region, 41 in the Southeast region, and 12 in the Southwest region, respectively, that were open a full 12 months ending fiscal year March 31, 2016

Section I – Background Information

Fondue Is Culinary Experience at The Melting Pot

Fondue is much more than those fancy pots and skewers stashed away in your parents’ high cupboards. A variety of tastes and types of this classic cuisine exist, and diners looking for a culinary adventure can head to The Melting Pot Fondue Restaurant.

Known as Hugh Hefner’s favorite restaurant, The Melting Pot has about 120 restaurants in the United States, Canada, Mexico, Indonesia and Dubai.

The international expansion is relatively recent. The Melting Pot entered the Middle East in September 2015 with a restaurant in Dubai, introducing fondue to the region. The opening followed the chain’s first location outside North America, this one in Jakarta, Indonesia, in July 2015.



The company’s footprint continues to grow, with more than 15 international locations currently in development. The chain is seeking franchisors for expansion in both domestic and international markets.

Multi-Course Fondue Meals

The restaurants feature decor in dark red and black, with dim lighting and booth seating. The experience is designed for couples looking for multi-course fondue meals (such as the Four-Course Experience), friends looking for a special dining experience, or for those planning a celebration.

In addition to a variety of fondue menu items, both savory and sweet, and dipping sauces, the restaurants also offer salads, artisan breads and cheeses, and fine wines, craft beers and other alcoholic beverages. Some ingredients include lobster, filet mignon and other upscale foods.

Menus can also be prepared for large gatherings or special occasions. Gifts, gift cards, and food items can be purchased.

Chain Thrives in Casual Dining Segment, Climbs Back in Franchise 500

In 2015, The Melting Pot was named the No. 1 casual dining chain on Nation’s Restaurants News’ Consumer Picks list. The chain dropped to No. 2 in 2016.

The Melting Pot was No. 457 on Entrepreneur’s Franchise 500 list for 2016. After nudging past the 200 mark with a ranking of No. 199 in 2011, the chain plummeted to No. 379 in 2013 and 398 in 2014, and slid further to No. 478 in 2015.

Location numbers have dwindled slightly in the past several years, dropping from more than 140 to finish 2015 with 127 restaurants.

First Location Offered Three Fondue Items

The Melting Pot began in 1975 with a location in Maitland, Fla., near Orlando, that had just three menu items: Swiss cheese fondue, beef fondue and a chocolate fondue dessert. A second location opened in Orlando the following year.

Brothers Mike, Mark and Bob Johnston in 1979 opened a Melting Pot location in Tallahassee, Florida, and in 1981 opened a second location in Tampa, Florida. In 1985, they purchased the rights to the restaurant. They established The Melting Pot Restaurants Inc. as a franchise company, intent on growing the company.

Growth was slow at first, but eventually the spurt came. The 100th location opened in 2005 as the company turned 30, and the company saw its first international locations in 2010 with expansion into Canada and Mexico.



The Melting Pot is an affiliate of Front Burner Brands, a Tampa-based restaurant management company.

Section II – Estimated Costs

  • Please click here for detailed estimates of The Melting Pot franchise costs, based on Item 7 of the company’s 2016 FDD (updated).

Section III – Financial Performance Representations (Item 19, 2016 FDD) and Analysis



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