In this FDD Talk post, you’ll learn the following:
- Section I – Background information on the BurgerFi franchise opportunity, including relevant news updates
- Section II – Estimated initial investment for a BurgerFi franchise, based on Item 7 of the company’s 2018 FDD
- Section III – Initial franchise fee, royalty fee, marketing fee, and other fees for a BurgerFi franchise, based on Items 5 and 6 of the company’s 2018 FDD
- Section IV – Number of franchised and company-owned BurgerFi outlets at the start of the year and the end of the year for 2015, 2016, and 2017, based on Item 20 of the company’s 2018 FDD
- Section V – Presentation and analysis of BurgerFi’s financial performance representations, based on Item 19 of the company’s 2018 FDD, including information on the:
- 2017 average and median net sales for the 12 franchised and affiliate-owned BurgerFi Restaurants open and in operation for at least 60 months as of December 31, 2017
- 2017 average and median net sales for the 31 franchised and affiliate-owned BurgerFi Restaurants open and in operation for at least 48 months as of December 31, 2017
- 2017 average and median net sales for the 51 franchised and affiliate-owned BurgerFi Restaurants open and in operation for at least 36 months as of December 31, 2017
- 2017 average and median net sales for the 78 franchised and affiliate-owned BurgerFi Restaurants open and in operation for at least 12 months as of December 31, 2017
- 2017 average cost of goods sold and labor costs for the 14 affiliate-owned BurgerFi Restaurants open and operating for all of 2017
Section I – Background Information
17 Things You Need to Know About the BurgerFi Franchise
Adds Chicken to the Menu for the First Time
1. At the beginning of July 2018, BurgerFi announced the system-wide debut of its first-ever grilled chicken sandwich offering. BurgerFi has added the Chicken Avocado BLT sandwich to its menu for a limited time, with the possibility of the sandwich becoming a permanent staple at a later date. The new Chicken Avocado BLT features an all-natural, free-range grilled chicken breast stacked with fried avocado, then topped with white cheddar, bacon, lettuce, tomato, and honey mustard-BBQ sauce.
2. Not only is the new sandwich healthier than other chicken sandwiches, but one dollar from each sandwich will be donated to St. Jude Children’s Research Hospital to help end childhood cancer.
3. Paul Griffin, BurgerFi’s executive chef, said, “We’ve been testing variations of the chicken sandwich for almost a year to ensure our guests have a craveable culinary experience. We always try to infuse our own innovative twist to the standard on anything we do. The fried avocado adds a unique crunch factor – you definitely don’t see that everywhere.”
Debuts New Marketing Campaign
4. In late January 2018, BurgerFi launched a new marketing campaign which features the tagline “BURGERS for Every 1.” The campaign focuses on the company’s mission to serve only the top 1% of best-tasting, certified American Black Angus beef from the top ranches across the country.
5. The new advertising campaign, created by Rochester, New York-based agency Partners + Napier, highlights the fact that everyone has a niche and ability to excel in something and they deserve to celebrate those qualities that make them unique with a burger that is special too.
6. Creative assets also correlate these qualities to specific burgers on the menu and feature fun, unexpected imagery and headlines. The unique alpha-numerical tagline is representative of both the top 1% of beef used by BurgerFi that “never-ever” contains hormones, antibiotics, steroids, or additives, and the perspective that BurgerFi restaurants will continue to serve the millions of one-of-a-kind guests.
7. According to Corey Winograd, CEO of BurgerFi, “The ‘BURGERS for Every 1’ campaign was inspired by the fact that only about 1% of the beef produced in the United States meets the strict BurgerFi standard of quality. We offer an experience that isn’t purely for ‘burger lovers’ or ‘environmentalists’ or ‘families’ but for every unique individual who wants to reward themselves with something better. Our approach to every aspect of the BurgerFi experience – from the friendliness of our team to our sustainability efforts and fresh better burgers – is that guests can see and taste the difference.”
8. The campaign rolled out on January 29 via national and local digital media, pre-roll video, radio, social media, billboards, email, and in-store displays.
Targets D.C. Metro Area for Expansion
9. Currently, BurgerFi has a strong presence in the Southeast region and continues to see steady growth in the Northeast. Due to its rapid expansion in the Eastern region of the country, the contemporary burger concept views the D.C. area as a natural next step in its franchise development initiatives.
10. In a press release, BurgerFi said that it was able to grow to over 105 locations within the first five years of franchising by offering a chef-driven, fast-casual, better burger concept – a previously untapped segment of the burger industry.
11. Graham Buckley, franchise development manager for BurgerFi, said, “One of the reasons BurgerFi became so popular so quickly is because it is different from any other experience as far as its food level and atmosphere. We’re looking forward to bringing our unique concept to new consumers in the D.C. metro area and beyond.”
12. BurgerFi’s growth momentum continues with a goal of opening 20+ new locations in 2018. In addition to those openings, BurgerFi is focusing its development initiatives along the East Coast, including Virginia, North Carolina, South Carolina, Pennsylvania, and New York. The brand is looking to expand throughout D.C. alongside franchisees who are able to bring restaurant experience to the table. The opportunity is designed with multi-brand operators in mind who are looking to grow their franchise portfolio.
13. The first BurgerFi restaurant was opened in 2011 by founder John Rosatti in Lauderdale-by-the-Sea, Florida. Rosatti worked with David Manero and Lee Goldberg to develop the concept for BurgerFi, which came about after all three were unable to find quality burgers with fresh ingredients at affordable prices.
14. Before starting BurgerFi, Rosatti owned another restaurant called The Office in Delray Beach, Florida. When The Office added the all-natural Angus “CEO Burger,” it was an instant hit and Rosatti decided that the CEO Burger would become one of BurgerFi’s signature items. BurgerFi was an immediate success and Rosatti, Manero, and Goldberg quickly started to franchise the BurgerFi concept.
15. In the years since the first BurgerFi location opened, the brand has continued to innovate. In 2017, BurgerFi was the first fast-casual restaurant to start offering a vegetarian/vegan burger patty called the “Beyond Burger.” The Beyond Burger, created by the Beyond Meat company, is considered one of the best veggie burgers on the market because it closely mimics the textures and tastes of real beef. The Beyond Burger has no cholesterol, but it oozes “grease” on the griddle and even “bleeds” beet juice.
16. Today, BurgerFi has locations across the United States, Canada, Mexico, Panama, the Middle East, and England.
Entrepreneur’s Franchise 500
17. BurgerFi did not rank on Entrepreneur’s 2018 Franchise 500 list.
Section II – Estimated Costs
- Please click here for detailed estimates of BurgerFi franchise costs, based on Item 7 of the company’s 2018 FDD.
Section III – Initial Franchise Fee, Royalty Fee, Marketing Fee, and Other Fees
- Please click here for detailed information on BurgerFi’s initial franchise fee, royalty fee, marketing fee, and other fees, based on Items 5 and 6 of the company’s 2018 FDD.
Section IV – Number of Franchised and Company-Owned Outlets
- Outlets at the Start of the Year: 52
- Outlets at the End of the Year: 63
- Net Change: +11
- Outlets at the Start of the Year: 63
- Outlets at the End of the Year: 72
- Net Change: +9
- Outlets at the Start of the Year: 72
- Outlets at the End of the Year: 79
- Net Change: +7
- Outlets at the Start of the Year: 12
- Outlets at the End of the Year: 14
- Net Change: +2
- Outlets at the Start of the Year: 14
- Outlets at the End of the Year: 16
- Net Change: +2
- Outlets at the Start of the Year: 16
- Outlets at the End of the Year: 16
- Net Change: 0
Section V – Financial Performance Representations (Item 19, 2018 FDD) and Analysis
- All of the data disclosed below is as of December 31, 2017. This data is not audited, and is derived from information provided by franchisees as well as from affiliate-owned Restaurants.
Part 1 – Net Sales of Restaurants Open for at Least 60 Months as of December 31, 2017
- BurgerFi had 12 franchised and affiliate-owned Restaurants open and in operation for at least 60 months as of December 31, 2017.