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

• Section I – Background information on the Fuzzy’s Taco Shop franchise opportunity, including relevant news updates

• Section II – Estimated initial investment for a Fuzzy’s Taco Shop franchise, based on Item 7 of the company’s 2020 FDD

• Section III – Initial franchise fee, royalty fee, marketing fee, and other fees for a Fuzzy’s Taco Shop franchise, based on Items 5 and 6 of the company’s 2020 FDD

• Section IV – Number of franchised and company-owned Fuzzy’s Taco Shop outlets at the start of the year and the end of the year for 2017, 2018, and 2019, based on Item 20 of the company’s 2020 FDD

• Section V – Presentation and analysis of Fuzzy’s Taco Shop’s financial performance representations, based on Item 19 of the company’s 2020 FDD, including information on the:

• 2019 average, median, lowest, and highest gross revenue for the 134 system-wide, 124 franchised, and 10 company-owned Fuzzy’s Taco Shop Restaurants that were open and operating for the entire 52-week annual period beginning December 31, 2018 and ending December 29, 2019 (separately stated)

• 2019 average, median, lowest, and highest food cost %, labor cost %, and occupancy cost % for the 10 company-owned Fuzzy’s Taco Shop Restaurants that were open and operating for the entire 52-week annual period beginning December 31, 2018 and ending December 29, 2019

Section I – Background Information

14 Things You Need to Know About the Fuzzy’s Taco Shop Franchise

Appoints New CFO

1.  In early September 2019, Fuzzy’s Taco Shop named Jessica Wescott as its chief financial officer. Wescott previously served as the executive vice president of finance for the Baja-inspired franchise. Wescott began her career in wealth management before moving into the franchising world and working her way up to vice president of development and finance with MOOYAH Burgers, Fries & Shakes.

2.  In January 2018, Wescott was named executive vice president of finance for Fuzzy’s Taco Shop, where she oversaw many aspects of financial operations, as well as marketing and technology strategies, and fed her love of working with franchisees. For her, the similarities between wealth management and franchising are clear: It’s all about relationships and helping partners be successful.

3.  To Wescott, the role offers more than overseeing the financials of the company, budgeting, and forecasting. “We have the opportunity to use data to objectively analyze and shape the brand’s strategies in order to increase sales and profitability for our franchisees. Over the last year and a half, we’ve made some tremendous investments in people to take the brand to the next level.”

4.  Wescott also began working on Fuzzy’s strategy for 2020, including how to best support multi-unit franchisees. In fact, 79% of all Fuzzy’s openings since 2017 have been with current partners looking to expand their footprint.

5.  Wescott added, “Our partners are incredibly passionate about the brand. Both our ownership group and our leadership team are heavily invested in working with our partners and ensuring we remain franchisee-centric as we continue to grow. I’m excited for the opportunity to continue to impact that culture and be part of the success that Fuzzy’s has enjoyed so far – and will continue to have in the future.”

Brings Back Fall Cornutopia Menu for Limited Time

6.  In early October 2019, Fuzzy’s Taco Shop announced that it was bringing back its Cornutopia menu and its three limited-edition items in time for the fall season and National Taco Day on October 4. In celebration of autumnal flavors, Fuzzy’s combined its Baja-inspired flavors with roasted corn, a traditional fall ingredient, to create three one-of-a-kind offerings: Street Cred Corn, Corn To Be Wild Quesadillas, and the Shuck It Brisket Taco. Guests could wash down these limited-time offerings with an icy-cold beverage like the brand’s famous and flavorful margaritas.

7.  Based off last year’s glowing reviews from Fuzzy’s cult-like following, the returning menu items include Street Cred Corn, roasted corn kernels topped with Parmesan cheese, Fuzzy Dust, cilantro, and roasted poblano cream for $2.99; Corn To Be Wild Quesadillas, a shredded chicken quesadilla with roasted corn, roasted poblano peppers, shredded cheese, and a side of roasted poblano ranch for $7.19; and lastly, the Shuck It Brisket Taco, a shredded brisket taco with roasted corn, roasted poblano peppers and cilantro, drizzled with roasted poblano crema for $2.79.

8.  Laura Purser, vice president of marketing for Fuzzy’s Taco Shop, said, “After receiving great guest feedback from last year’s limited-time offer, we knew we had to bring back these awesome fall-inspired foods this year. Since the season is now in full swing, our pairings of corn with cheese, roasted poblanos, shredded chicken and brisket will be well-received by our guests this fall.”

9.  “Our guests are fans of big flavors and a laid-back atmosphere in which to enjoy them, all at an accessible price point,” said Michael Mabry, chief development officer of Fuzzy’s. “Our three new Cornutopia items deliver on our promise to always keep bold, innovative and unique dishes part of the Fuzzy’s experience.”

Company History

10.  Fuzzy’s Taco Shop was founded in 2001 by Paul Willis in Fort Worth, Texas near the campus of Texas Christian University. Fuzzy’s was an instant hit with the nearby college students. Although Fuzzy’s Taco Shop was doing well, Willis decided to sell the business to father and son restaurateurs, Alan and Chuck Bush.

11.  After a few more years, the Bushes opened a second Fuzzy’s Taco Shop in East Fort Worth in 2007. Two years later, Fuzzy’s Taco Shop started franchising, and the Bushes primarily targeted locations near college campuses before expanding to other areas.

12.  Over the next few years, the Bushes continued to grow Fuzzy’s Taco Shop around the U.S. By 2016, the chain had grown to 100 locations. That same year, the Bushes sold a 70% stake in Fuzzy’s Taco Shop to Atlanta-based private equity group NRD Capital Management.

13.  Today, Fuzzy’s Taco Shop has locations in Texas, Oklahoma, Louisiana, Arkansas, Colorado, Florida, Georgia, Iowa, Kansas, Mississippi, Missouri, Montana, Nebraska, North Carolina, Ohio, and Virginia. Fuzzy’s has plans to surpass 200 locations by 2021.

Entrepreneur’s Franchise 500

14.  Fuzzy’s Taco Shop ranked No. 262 on Entrepreneur’s 2020 Franchise 500 list.

Section II – Estimated Costs

• Please click here for detailed estimates of Fuzzy’s Taco Shop franchise costs, based on Item 7 of the company’s 2020 FDD.

Section III – Initial Franchise Fee, Royalty Fee, Marketing Fee, and Other Fees

• Please click here for detailed information on Fuzzy’s Taco Shop’s initial franchise fee, royalty fee, marketing fee, and other fees, based on Items 5 and 6 of the company’s 2020 FDD.

Section IV – Number of Franchised and Company-Owned Outlets

Franchised

2017

• Outlets at the Start of the Year:  100
• Outlets at the End of the Year:  127
• Net Change:  +27

2018

• Outlets at the Start of the Year:  127
• Outlets at the End of the Year:  137
• Net Change:  +10

2019

• Outlets at the Start of the Year:  137
• Outlets at the End of the Year:  136
• Net Change:  -1

Company-Owned

2017

• Outlets at the Start of the Year:  7
• Outlets at the End of the Year:  7
• Net Change:  0

2018

• Outlets at the Start of the Year:  7
• Outlets at the End of the Year:  10
• Net Change:  +3

2019

• Outlets at the Start of the Year:  10
• Outlets at the End of the Year:  10
• Net Change:  0

Section V – Financial Performance Representations (Item 19, 2020 FDD) and Analysis

• The following charts contain certain historical data related to the operation of franchised and company-owned Fuzzy’s Taco Shop Restaurants. The data included in this Item 19 was taken from information reported to the franchisor by its franchisees and affiliates, and reflects information for the 52-week annual period beginning December 31, 2018 and ending December 29, 2019 (the “Measurement Period”).

Part 1 – Unit Gross Revenue

• As of December 29, 2019, Fuzzy’s Taco Shop had 146 system-wide Restaurants (136 franchised Restaurants and 10 company-owned Restaurants).

• The information presented in this Item 19 pertains to the 134 system-wide Restaurants that had been open and operating during the entire Measurement Period (“System Reporting Units”), of which 124 were franchised Restaurants (“Franchised Reporting Units”) and 10 were company-owned Restaurants (“Company Reporting Units”).

• All Company Reporting Units were operated by an affiliate of Fuzzy’s Taco Shop during the Measurement Period (each a “Reporting Affiliate”).

Unit Gross Revenue

System-Wide