In this FDD Talk post, you’ll learn the following:
- Section I – Background information on the Teriyaki Madness franchise opportunity, including relevant news updates
- Section II – Estimated initial investment for a Teriyaki Madness franchise, based on Item 7 of the company’s 2019 FDD
- Section III – Initial franchise fee, royalty fee, marketing fee, and other fees for a Teriyaki Madness franchise, based on Items 5 and 6 of the company’s 2019 FDD
- Section IV – Number of franchised and company-owned Teriyaki Madness outlets at the start of the year and the end of the year for 2016, 2017, and 2018, based on Item 20 of the company’s 2019 FDD
- Section V – Presentation and analysis of Teriyaki Madness’s financial performance representations, based on Item 19 of the company’s 2019 FDD, including information on the:
- 2015 to 2018 average, median, high, and low gross sales for the Teriyaki Madness restaurants that have been in operation for at least two years, were larger than 1,350 square feet (which match the footprint required of new Teriyaki Shops), were in traditional locations, and have had no change of ownership within the two-year period described
- 2015 to 2018 average, median, maximum, and minimum same store sales increase for the Teriyaki Madness restaurants that have been in operation for at least two years, were larger than 1,350 square feet (which match the footprint required of new Teriyaki Shops), were in traditional locations, and have had no change of ownership within the two-year period described
- 2018 total sales, cost of goods sold, gross profit, payroll and labor, occupancy, direct operating expenses, and operating income for the 13 Teriyaki Madness restaurants that have been open for a minimum of 24 months, are larger than 1,350 square feet, have not changed ownership in the last two years, and are in traditional locations
Section I – Background Information
20 Things You Need to Know About the Teriyaki Madness Franchise
Opens 50th Location
1. In late April 2019, Teriyaki Madness celebrated the opening of its 50th location with its latest site launch in Oakdale, Minnesota. This location is the brand’s first in the state. Franchise owner Chris Tayson partnered with his son, Charlie, and the two signed on to bring Teriyaki Madness’s unique concept, fresh ingredients, and flavor-packed bowls to Oakdale.
2. Chris Tayson said, “The folks in Oakdale were eagerly awaiting our opening. It’s going to be exciting and new for the area, and a different alternative to the existing fast food restaurants. We’ve received a ton of support.”
3. At the time of the announcement, Teriyaki Madness had opened eight locations so far in 2019 and said that it has plans for another 30 by the end of the year. In addition to breaking into the Minnesota market with the introduction of the system’s 50th location in Oakdale, Teriyaki Madness has also recently entered the Utah market with a location in Spanish Fork.
4. Nine additional states will soon host Teriyaki Madness locations: Delaware, Georgia, Hawaii, Illinois, New Jersey, Pennsylvania, South Dakota, and Tennessee.
5. Notable franchisees that supported Teriyaki Madness in its pursuit of 50 units include Eric Garma and Alan Arreola, the founders of Teriyaki Madness, who just opened their fifth location in the Las Vegas market; Robert Gonzalez of Las Vegas, who recently opened his second location in the area; and Keith and Allison Colson, who opened their second Teriyaki Madness location in Chandler, Arizona this year.
6. Jodi Boyce, vice president of marketing for Teriyaki Madness, said, “Consumers everywhere are hungry for our always made-to-order, flavor-packed offering and our ongoing growth reflects that. On top of that, we offer our franchisees a streamlined operational model in support of their success. We are passionate about continuing to grow the brand as we continue to offer second-to-none ‘bowl’d’ flavor.”
Beefs Up Executive Team to Support Franchise Growth
7. At the end of March 2019, Teriyaki Madness stated that over the past three years, the company has recruited top-notch talent to every area of brand leadership. The result: a completely stacked team with the expertise to skillfully lead Teriyaki Madness as it prepares to double in size in 2019.
8. The executive team now consists of eight individuals with extensive industry knowledge and experience working both with franchisors and as franchisees. The team is led by CEO Michael Haith, an entrepreneur who specializes in emerging franchises, who has invested in brands such as Pour La France!, Maui Wowi Hawaiian, Doc Popcorn, and Kidcreate Studios.
9. Haith said, “In the early days, we all wore a lot of hats and had to be very scrappy to get things done. It took committing to a multi-year rebuild to get us exactly where we want to be as we take on the next few years of incredible growth. We invested in the infrastructure to form a ‘best-in-class’ franchisor with a common goal: providing a robust and thorough support system for our franchisees.”
10. Two of the newest additions to Teriyaki Madness’s executive team are Jodi Boyce, vice president of marketing, and John Miller, CFO. Boyce brings 20 years of franchise marketing leadership experience to Teriyaki Madness, with stints at Quiznos and Smashburger. Miller comes to the company having served in senior- and executive-level financial roles, including CFO, with brands such as Chipotle and McDonald’s and even a role on the franchise side with Carl’s Jr.
11. Rounding out the executive team are Janice Branam (vice president of operations), who was the senior vice president of operations excellence for Smashburger and senior vice president of training for Quiznos; Joe Gordon (vice president of supply chain) was head of supply chain for Portillo’s and Noodles & Company and held key supply chain leadership positions for Wendy’s; Erin Hicks (chief operating officer) was executive vice president for Maui Wowi; Peter Harding (vice president of real estate) was senior director of real estate for Einstein’s and Caribou; and Hank Janik (vice president of real estate) was head of real estate for Moe’s Southwest Grill and Schlotzsky’s.
12. Haith added, “The team we’ve assembled brings so much to the table. Each member’s unique skills make us efficient, nimble and capable of supporting our franchisees as we continue to scale in 2019 and beyond.”
13. Also according to Boyce, “Our team is cohesive because we all fit the brand culture. No one person dictates how things should be; it’s truly a team effort. We are all comfortable discussing our challenges, raising our concerns, offering our opinions and contributing our ideas. We communicate a lot, and we do so very well. We really weigh out the pros and cons of any decision before finalizing anything. It’s so important that leadership starts at the top. The presence of a great executive team has a trickle-down effect so that greatness at every level of the company will follow. We put in the work defining and solidifying processes, and now each of our leaders is building out their own teams and truly assembling the best of the best.”
Adds Salmon to the Menu
14. After finding success in the Las Vegas market, Teriyaki Madness launched a new limited-time offering, Teriyaki Salmon, to bowls nationwide in mid-February 2019. Marinated and grilled to perfection, the 4-ounce salmon fillet (or 8-ounce fillet for customers who like even bigger bowls) garnishes the top of the customer’s choice of white rice, brown rice, fried rice, or noodles, plus fresh stir-fried veggies, all topped with the brand’s house-made teriyaki sauce.
15. Michael Haith, CEO of Teriyaki Madness, said, “TMAD is dedicated to providing the best teriyaki bowls to our customers, so we’ve always been careful not to oversaturate our menu. This rollout of Teriyaki Salmon is us answering a resounding call from TMAD customers across the nation. You asked, and we delivered.”
16. According to Jodi Boyce, vice president of marketing for Teriyaki Madness, “We initially introduced Teriyaki Salmon at our Las Vegas locations as an LTO nearly two years ago, where it has proven itself to be an extremely viable menu option. Because it has maintained consistent popularity without any pomp or circumstance, we’re excited to be rolling it out nationally for even more TMAD fans to experience and enjoy.”
17. Teriyaki Madness was founded in 2003 by Alan Arreola, Rod Arreola, and Eric Garma in Las Vegas, Nevada. The Arreolas and Garma were originally from Seattle, Washington, which has a love affair with Japanese-style teriyaki bowls. The business partners wanted to offer a healthier fast-food option and felt that their favorite teriyaki bowl, which is served with fresh veggies, would appeal to customers looking for healthy and high-quality food.
18. The first Teriyaki Madness location was a success and the Arreolas and Garma began franchising the concept in 2005. To help fuel the company’s growth, the Arreolas and Garma brought in Michael Haith, who is an experienced franchisor, in 2012. A year later, the first Teriyaki Madness opened outside of Nevada and the brand continued to grow slowly over the next few years.
19. In 2017, Michael Haith purchased Teriyaki Madness from the Arreolas and Garma and has continued to push the company’s growth.
Entrepreneur’s Franchise 500
20. Teriyaki Madness ranked No. 465 on Entrepreneur’s 2019 Franchise 500 list.
Section II – Estimated Costs
- Please click here for detailed estimates of Teriyaki Madness franchise costs, based on Item 7 of the company’s 2019 FDD.
Section III – Initial Franchise Fee, Royalty Fee, Marketing Fee, and Other Fees
- Please click here for detailed information on Teriyaki Madness’s initial franchise fee, royalty fee, marketing fee, and other fees, based on Items 5 and 6 of the company’s 2019 FDD.
Section IV – Number of Franchised and Company-Owned Outlets
- Outlets at the Start of the Year: 21
- Outlets at the End of the Year: 33
- Net Change: +12
- Outlets at the Start of the Year: 33
- Outlets at the End of the Year: 41
- Net Change: +8
- Outlets at the Start of the Year: 41
- Outlets at the End of the Year: 42
- Net Change: +1
- Outlets at the Start of the Year: 3
- Outlets at the End of the Year: 2
- Net Change: -1
- Outlets at the Start of the Year: 2
- Outlets at the End of the Year: 1
- Net Change: -1
- Outlets at the Start of the Year: 1
- Outlets at the End of the Year: 2
- Net Change: +1
Section V – Financial Performance Representations (Item 19, 2019 FDD) and Analysis
Part 1 – Average, Median, High, and Low Gross Sales and Same Store Sales
- The information in the table below contains Gross Sales and same store sales information obtained from franchisees’ Profit and Loss Statements and is a historical financial performance representation for the franchised Teriyaki Shops that met the following criteria: (a) have been in operation for at least two years; (b) were larger than 1,350 square feet (which match the footprint required of new Teriyaki Shops); (c) were in traditional locations; and (d) that have had no change of ownership within the two-year period described (“Conditions”).