In this FDD Talk 2017 post, you’ll learn the following:
- Section I – Background information on the Cicis franchise opportunity, including relevant news updates
- Section II – Estimated initial investment for a Cicis franchise, based on Item 7 of the company’s 2017 FDD
- Section III – Initial franchise fee, royalty fee, marketing fee, and other fees for a Cicis franchise, based on Items 5 and 6 of the company’s 2017 FDD
- Section IV – Presentation and analysis of Cicis’ financial performance representations, based on Item 19 of the company’s 2017 FDD, including information on the:
- 2016 average sales, food and paper costs, team labor, management salaries, taxes and benefits, operating expenses, advertising, videos/other income, occupancy costs, and restaurant EBITDA for the 37 company-owned Cicis Restaurants that were open and operating for at least 18 months before December 25, 2016 and that the company operated during the entire period of its fiscal year ended December 25, 2016
- 2016 average, high, and low gross sales for the 364 franchised, 35 company-owned, and 408 franchised and company-owned Cicis Restaurants (separately stated, with each group divided into 3 categories according to sales volume) open and operating for at least 18 months before December 25, 2016 and in operation during the entire period of the company’s 2016 fiscal year
Section I – Background Information
12 Things You Need to Know About the Cicis Franchise
Brand Revitalization Spurs Company’s Growth
1. Over the past few years, Cicis has enjoyed steady sales growth as a result of revitalizing its brand. In October, the company announced that it was going to “accelerate new restaurant openings” in order to build on this momentum. The company says that it currently has nine new franchised and corporate restaurants under construction, with five additional leases signed and construction pending. Cicis plans to open a few more restaurants by the end of the year, including one in Bastrop, Texas and another in Fulshear, Texas.
2. Cicis reports that new restaurant openings are generating unprecedented buzz for the brand as customers are responding well to Cicis’ improved food quality, menu additions like Stuffed Crust pizzas, and new restaurant design. One of the company’s newest locations in Orangeburg, South Carolina created so much interest that customers camped out overnight and lined up around the block for the store’s grand opening.
3. Cicis CEO Darin Harris said, “With every new restaurant opening, we are improving our brand perception with great-looking restaurants, outstanding buffet offerings and a high-quality guest experience – all at a great value.” For 2018 and beyond, the company has signed multiple development agreements with franchise partners representing more than 68 future restaurants in 14 states.
New Menu Offerings
4. At the start of September, just in time for football season, Cicis introduced its newest limited-time offer — pizza inspired by wings in three flavors: Sweet Honey BBQ, Zesty Garlic Parmesan, and Fiery Buffalo. The new pizzas feature Cicis’ traditional garlic buttery crust topped with wing-inspired sauces and 100 percent premium white meat chicken, real cheese, and additional sauces and flavors.
5. As always, customers have the option to customize these pizzas for carryout and can also add an order of 3, 5, 10, or 20 wings, available in Hot Buffalo, Mild Buffalo, Garlic Parmesan, and BBQ.
6. Cicis CEO Darin Harris said, “We created a whole new category of pizza at Cicis for wing lovers who don’t want to choose between their favorite flavors, and who love to try new things. And it’s no accident that we’re bringing in our ‘wings by the slice’ for football season – they combine the two most popular game day foods in one delicious bite.”
New Additions to Executive Team
7. Earlier in 2017, Cicis appointed Jini Foust as its new Chief Operating Officer and Billie Jo Waara as its new Chief Marketing Officer. Foust has more than 30 years of experience in the multi-unit restaurant industry, including 10 years with McDonald’s Corp. and 23 years at Yum! Brands, Inc. She most recently served as Vice President of Company Operations and Facilities Maintenance for Taco Bell Corp. In her new role as COO, Foust will oversee Cicis’ franchise and corporate operations, service, and training.
8. Prior to joining Cicis, Billie Jo Waara served as CMO of Taco John’s and is credited with digital initiatives and culinary innovation at the taco franchise. Waara said that she is looking forward to working with the brand to build upon its success and further the company’s growth.
9. Cicis (formerly CiCi’s Pizza) was founded in 1985 by Mike Cole and Joe Croce in Plano, Texas. The company began franchising in 1987 and over the next decade opened restaurants across the U.S. By 2001, there were over 363 Cicis locations in the country. Around this same time, Cicis started remodeling its stores and expanded its pizza buffet offerings.
10. In 2003, Croce retired from the company and passed ownership of Cicis over to the company’s executive team. Since Croce retired, Cicis has had a few different CEOs; Darin Harris is the current CEO after joining the brand in 2013.
11. Near the end of 2015, the company changed its name from CiCi’s Pizza to Cicis with the added modifier “Beyond Pizza.” It also debuted a new logo and redesigned its website around this same time. Today, there are over 450 Cicis restaurants in 32 states.
Entrepreneur’s Franchise 500
12. Cicis has ranked on Entrepreneur’s annual Franchise 500 list every year over the past decade. The company’s highest rank was No. 67 in 2011, while its lowest rank was No. 269 in 2015.
Section II – Estimated Costs
- Please click here for detailed estimates of Cicis franchise costs, based on Item 7 of the company’s 2017 FDD.
Section III – Initial Franchise Fee, Royalty Fee, Marketing Fee, and Other Fees
- Please click here for detailed information on Cicis’ initial franchise fee, royalty fee, marketing fee, and other fees, based on Items 5 and 6 of the company’s 2017 FDD.
Section IV – Financial Performance Representations (Item 19, 2017 FDD) and Analysis
Part 1 – Analysis of Average Sales and Certain Average Costs and Expenses for Company-Owned Cicis Restaurants
- Part 1 of this financial performance representation analyzes average sales and certain average costs and expenses for company-owned Cicis Restaurants. To Go Units are not included.
- The analysis was based on the operating results of the 37 company-owned Cicis Restaurants that were open and operating for at least 18 months before December 25, 2016 and that the company operated during the entire period of its fiscal year ended December 25, 2016 (“Sample Restaurants”).
- There are a total of 49 company-owned Restaurants in 7 states. The company excluded 1 To-Go Unit and 11 Restaurants that it did not operate for a full 12 periods before December 25, 2016, including 2 Restaurants that were closed and 1 that was refranchised.
- These Restaurants offer substantially the same products and services that your Restaurant will offer.
- Each of the Sample Restaurants used a uniform accounting system, and the data was prepared on a basis consistent with generally accepted accounting principles during the applicable period.
- The Sample Restaurants averaged 8 years in operation.
- The information has not been audited.
Table 1 – Average Sales for Sample Restaurants in Fiscal Year 2016 (Unaudited)