In this FDD Talk post, you’ll learn the following:
- Section I – Background information on the Buffalo Wild Wings franchise opportunity, including relevant news updates
- Section II – Estimated initial investment for a Buffalo Wild Wings franchise, based on Item 7 of the company’s 2021 FDD
- Section III – Initial franchise fee, royalty fee, marketing fee, and other fees for a Buffalo Wild Wings franchise, based on Items 5 and 6 of the company’s 2021 FDD
- Section IV – Number of franchised and company-owned Buffalo Wild Wings outlets at the start of the year and the end of the year for 2018, 2019, and 2020, based on Item 20 of the company’s 2021 FDD
- Section V – Presentation and analysis of Buffalo Wild Wings’ financial performance representations, based on Item 19 of the company’s 2021 FDD, including information on the:
- 2020 average, median, highest, lowest, top 3rd average, middle 3rd average, and bottom 3rd average unit volume for the 27 inline, 327 freestanding, and 313 end-cap affiliate-owned Buffalo Wild Wings sports bars that operated during the franchisor’s entire 2020 fiscal year from December 30, 2019 through January 4, 2021 (separately stated)
- 2020 average, median, highest, lowest, top 3rd average, middle 3rd average, and bottom 3rd average unit volume for the 27 inline, 274 freestanding, and 225 end-cap franchised Buffalo Wild Wings sports bars that operated during the franchisor’s entire 2020 fiscal year from December 30, 2019 through January 4, 2021 (separately stated)
Section I – Background Information
20 Things You Need to Know About the Buffalo Wild Wings Franchise
Launches Exclusive Sports Betting Experience with BetMGM
1. In mid-March 2021, BetMGM and Buffalo Wild Wings sports bars in Colorado, New Jersey, Indiana, Iowa, Tennessee, and West Virginia launched a unique sports betting experience. A first in the industry, the BetMGM app uses geolocation technology to offer custom promotions and bet types for guests who are physically inside a Buffalo Wild Wings in select markets.
2. Rita Patel, chief marketing officer of Buffalo Wild Wings, said, “Fans wagering on sports inside Buffalo Wild Wings can now win bigger on select bets thanks to our innovative partnership with BetMGM. As sports betting continues to grow throughout the country, we look forward to further expanding our footprint in the space and activating our partnership with BetMGM in ways that make the experience at our sports bars second to none.”
3. Buffalo Wild Wings has also launched an in-bar channel called OT Odds Powered by BetMGM. The network will air on select screens throughout participating sports bars nationwide and will deliver sports betting content such as live game odds as well as fantasy and betting advice. In states where mobile sports betting is legal, curated boosts, bets, and parlays in the form of a new and exclusive Blazin’ Bets offered within the BetMGM app are now available through a customer’s personal device.
4. Matt Prevost, chief revenue officer of BetMGM, said, “Our partnership with Buffalo Wild Wings is incredibly innovative and allows BetMGM to redefine how fans enjoy sports. The introduction of geolocation technology to offer bettors a customized experience in a Buffalo Wild Wings location is a great example of what we’re able to activate through this groundbreaking relationship.”
5. Additionally, Buffalo Wild Wings’ Picks and Props free-to-play game, available via the Buffalo Wild Wings mobile app, has received a design upgrade, including an updated parlay-style gameplay with new BetMGM elements. Picks can be made daily using BetMGM odds from any state where free-to-play games are permitted by law, with major prizes awarded monthly. Select winners will be inducted into the newly-created BWW Hall of Fame.
Testing a Robot That Can Fry Chicken Wings
6. In October 2021, Miso Robotics – the robotic technology company behind the burger-flipping Flippy the Robot – announced a partnership with Inspire Brands’ Buffalo Wild Wings. Flippy Wings is a “robotic chicken wing frying solution” that is designed to help brands maximize chicken wing output even while short-staffed in the kitchen.
7. Paul Brown, CEO of Inspire Brands, said, “Technology is making a fundamental impact on the end-to-end restaurant operational model. Intelligent automation including AI and robotics will not only transform how we communicate with and take orders from our guests but also how we prepare and serve food to those guests. This transformation will ultimately result in improved efficiencies in our restaurants and an overall elevated experience for our guests and our team members.”
8. Inspire Brands’ first Flippy Wings machine (which is already being dubbed “Wingy”) is being installed at the Inspire Brands Innovation Center in Atlanta, and a second will be installed at the Allowance Kitchen – Inspire Brands’ ghost kitchen center – where it will be tested and tweaked before making its way to a standalone Buffalo Wild Wings restaurant sometime next year.
9. Wingy can fry up chicken wings and drop them into a hot holding area for kitchen staff to pick up and distribute to guests when they’re ready. Initial tests by Miso show a 10-20% increase in productivity speed when the robot is being utilized, as well as fewer oil spillages.
10. Mike Bell, CEO of Miso Robotics, added, “From day one, Flippy Wings will cook more food with less waste and save staff for higher value contributions. Flippy Wings fries fresh, frozen or hand-breaded products like a pro, avoiding cross-contamination and increasing throughput while reducing costs. It is fast, safer to operate than traditional fryers and the whole system can be set up in just a few hours over existing equipment.”
Launches New Limited-Time Doritos Spicy Sweet Chili Flavored Sauce
11. In late September 2021, Buffalo Wild Wings began offering the limited-edition Doritos Spicy Sweet Chili Flavored Sauce. This latest sauce innovation combines two game day essentials – chicken wings and Doritos – to create an experience that only Buffalo Wild Wings can provide. Each order comes with a small sample bag of Doritos Spicy Sweet Chili chips too.
12. Doritos Spicy Sweet Chili Flavored Sauce features the flavors of soy sauce, brown sugar, onion, garlic, and paprika – and the wings are topped with Doritos Spicy Sweet Chili chip crumbles for an added layer of crunch with every bite.
13. Jamie Carawan, vice president of brand menu and culinary for Buffalo Wild Wings, said, “People love Buffalo Wild Wings because of our bold sauces. This allows us to push the envelope on flavor innovation and helps set our brand apart from the competition. We’re excited to partner with another iconic brand in Doritos to offer wing lovers the opportunity to experience a familiar flavor in a new and exciting way. We can’t wait to hear what they think!”
14. Caio Correa, senior director of marketing, Frito-Lay North America, added, “Everything Doritos does is on another level, and the new Buffalo Wild Wings collaboration is no exception. The Spicy Sweet Chili Flavored Sauce is inspired by one of our most unique and beloved flavors, it pairs perfectly with wings and an ice-cold refreshing Pepsi. We are thrilled to bring our fans another bold way to enjoy their favorite chips.”
15. Buffalo Wild Wings was founded in 1982 by Jim Disbrow and Scott Lowery in Columbus, Ohio. Disbrow and Lowery had just moved to Ohio from Buffalo, New York and couldn’t find any good buffalo wings when the craving struck them. So, Disbrow and Lowery decided to make their own buffalo wings and open a restaurant. Initially, the restaurant also served beef on weck, a type of sandwich popular in New York – the restaurant was originally called Buffalo Wild Wings & Weck.
16. The first Buffalo Wild Wings was a hit and a few months later, Disbrow and Lowery brought in a third business partner, Mark Lutz. None of them had restaurant experience and things were run haphazardly in the early years. Despite this, the business partners opened additional locations in Ohio, Indiana, and Steamboat Springs, Colorado.
17. In 1992, Buffalo Wild Wings became a franchise with the help of Francorp, a Chicago-based franchise development firm. Over the next few years, Buffalo Wild Wings continued to grow and in 1995, the brand began to move away from a college sports bar to casual dining. A new restaurant prototype was launched with a clear separation between the bar and dining areas.
18. By the end of the 1990s, Buffalo Wild Wings had grown to 100 locations and this growth continued into the next couple decades. In 2010, Buffalo Wild Wings launched its first international locations in Canada. In November 2017, Roark Capital Group and The Wendy’s Company, co-owners of Arby’s Restaurant Group, purchased the chain for about $2.4 billion plus debt. Arby’s Restaurant Group was renamed Inspire Brands, which is now the parent company to Arby’s, Buffalo Wild Wings, Dunkin’, Jimmy John’s, and several other restaurant franchise brands.
19. Today, Buffalo Wild Wings has locations in all 50 states and Washington, D.C., Canada, India, Mexico, Oman, Panama, Philippines, Saudi Arabia, United Arab Emirates, and Vietnam.
Entrepreneur’s Franchise 500
20. Buffalo Wild Wings did not rank on Entrepreneur’s 2021 Franchise 500 list.
Section II – Estimated Costs
- Detailed estimates of Buffalo Wild Wings franchise costs, based on Item 7 of the company’s 2021 FDD.
Section III – Initial Franchise Fee, Royalty Fee, Marketing Fee, and Other Fees
- Detailed information on Buffalo Wild Wings’ initial franchise fee, royalty fee, marketing fee, and other fees, based on Items 5 and 6 of the company’s 2021 FDD.
Section IV – Number of Franchised and Company-Owned Outlets
- Outlets at the Start of the Year: 585
- Outlets at the End of the Year: 587
- Net Change: +2
- Outlets at the Start of the Year: 587
- Outlets at the End of the Year: 574
- Net Change: -13
- Outlets at the Start of the Year: 574
- Outlets at the End of the Year: 531
- Net Change: -43
- Outlets at the Start of the Year: 615
- Outlets at the End of the Year: 621
- Net Change: +6
- Outlets at the Start of the Year: 621
- Outlets at the End of the Year: 632
- Net Change: +11
- Outlets at the Start of the Year: 632
- Outlets at the End of the Year: 673
- Net Change: +41
Section V – Financial Performance Representations (Item 19, 2021 FDD) and Analysis
- This Item 19 includes financial results from Buffalo Wild Wings’ “2020 Fiscal Year,” which is the period from December 30, 2019 through January 4, 2021. Buffalo Wild Wings has not made permanent, material changes to its franchise concept as a result of the COVID-19 pandemic.
- There were 1,204 Buffalo Wild Wings Sports Bars operating as of the end of Buffalo Wild Wings’ 2020 Fiscal Year.
- Buffalo Wild Wings excluded 8 of them because they first opened for business during the 2020 Fiscal Year and did not operate for the full year. Buffalo Wild Wings also excluded from this group the 2 alternate format Buffalo Wild Wings Sports Bars that its affiliates operate, because these sports bars are not typical of the experience of other Buffalo Wild Wings Sports Bars, and the franchised Buffalo Wild Wings Sports Bar that closed in March and had not yet reopened as of the disclosure document’s issuance date.
- Buffalo Wild Wings calls the remaining 1,193 Buffalo Wild Wings Sports Bars the “2020 Sports Bars.”
- Buffalo Wild Wings’ affiliates operated 667 of these sports bars and franchisees operated the other 526.
- Also excluded from the group of 2020 Sports Bars are the 2 affiliate-owned Buffalo Wild Wings Sports Bars and 9 franchised Buffalo Wild Wings Sports Bars that closed during the 2020 Fiscal Year. All of those sports bars had operated for more than 12 months before they closed.
- This financial performance representation discloses the average annual Gross Sales, also called Average Unit Volume or “AUV,” during the 2020 Fiscal Year for the 2020 Sports Bars, separated by the type of location (inline, free-standing, or end-cap). Buffalo Wild Wings included 2020 Sports Bars located in airports as “inline” sports bars.
- Buffalo Wild Wings also discloses the AUVs during the 2020 Fiscal Year for those 2020 Sports Bars in the top third, middle third, and bottom third of AUVs for all 2020 Sports Bars.
- Buffalo Wild Wings’ 2020 Fiscal Year contained 53 weeks. In order to show an accurate year-over-year comparison, this financial performance representation excludes Gross Sales from the 53rd week of Buffalo Wild Wings’ 2020 Fiscal Year.
A. Affiliate-Owned 2020 Sports Bars
- Number of Sports Bars: 27
- Average Unit Volume: $2,649,578
- Median Unit Volume: $2,684,815
- Highest Unit Volume: $3,728,084
- Lowest Unit Volume: $1,365,656
- Number and Percentage Above Average: 15/55.6%
- Top 3rd Average Unit Volume: $3,345,726
- Middle 3rd Average Unit Volume: $2,606,103
- Bottom 3rd Average Unit Volume: $1,996,906
- Number of Sports Bars: 327
- Average Unit Volume: $2,456,595
- Median Unit Volume: $2,415,052
- Highest Unit Volume: $4,761,054
- Lowest Unit Volume: $1,099,377
- Number and Percentage Above Average: 156/47.7%
- Top 3rd Average Unit Volume: $3,177,186
- Middle 3rd Average Unit Volume: $2,421,447
- Bottom 3rd Average Unit Volume: $1,771,153
- Number of Sports Bars: 313
- Average Unit Volume: $2,403,803
- Median Unit Volume: $2,378,142
- Highest Unit Volume: $4,920,445
- Lowest Unit Volume: $1,007,082
- Number and Percentage Above Average: 151/48.4%
- Top 3rd Average Unit Volume: $3,162,604
- Middle 3rd Average Unit Volume: $2,354,762
- Bottom 3rd Average Unit Volume: $1,686,746
All Affiliate-Owned Sports Bars
- Number of Sports Bars: 667
- Average Unit Volume: $2,439,633
B. Franchisee-Owned 2020 Sports Bars
- Number of Sports Bars: 27
- Average Unit Volume: $2,416,674
- Median Unit Volume: $2,416,570
- Highest Unit Volume: $4,000,952
- Lowest Unit Volume: $965,913
- Number and Percentage Above Average: 13/48.2%
- Top 3rd Average Unit Volume: $3,218,350
- Middle 3rd Average Unit Volume: $2,427,610
- Bottom 3rd Average Unit Volume: $1,686,417
- Number of Sports Bars: 274
- Average Unit Volume: $2,703,125
- Median Unit Volume: $2,651,638
- Highest Unit Volume: $5,754,716
- Lowest Unit Volume: $774,765
- Number and Percentage Above Average: 132/48.2%
- Top 3rd Average Unit Volume: $3,629,856
- Middle 3rd Average Unit Volume: $2,648,025
- Bottom 3rd Average Unit Volume: $1,821,311
- Number of Sports Bars: 225
- Average Unit Volume: $2,500,776
- Median Unit Volume: $2,405,180
- Highest Unit Volume: $5,663,641
- Lowest Unit Volume: $603,732
- Number and Percentage Above Average: 125/45.8%
- Top 3rd Average Unit Volume: $3,444,300
- Middle 3rd Average Unit Volume: $2,398,784
- Bottom 3rd Average Unit Volume: $1,659,245
All Franchisee-Owned Sports Bars
- Number of Sports Bars: 526
- Average Unit Volume: $2,601,865
- The 2020 Sports Bars range in size from 4,300 to 7,700 square feet, with an average of 6,000 square feet, although there are some atypical sports bars whose size falls outside this range.
- The 2020 Sports Bars had operated for an average of 9.7 years as of the end of the 2020 Fiscal Year.
- All of these sports bars offer essentially the same products and services, face the same kinds of competitive challenges, and receive the same level of support from Buffalo Wild Wings that it expects new franchisees will experience.
- These sports bars are located in various markets across the United States.
- The term “Gross Sales” has the same meaning here as it does in Item 6, and includes the total revenues and receipts from the sale of all products, services, and merchandise sold in or in relation to the Buffalo Wild Wings Sports Bar whether under any of the Trademarks or otherwise, including any cover charges or fees, fees or charges for any vending or similar activities or other equipment in the Buffalo Wild Wings Sports Bar or on its premises, fees or charges for any catering and other off-site activities and events, and all license and use fees. However, Gross Sales excludes sales taxes, promotions, voids, and discounts.
- Buffalo Wild Wings calculated the figures in the table above using information that its affiliates and franchisees provided.
- Prospective franchisees and sellers of franchises should be advised that no certified public accountant has audited these figures or expressed his or her opinion concerning their contents or form.
- This financial performance representation does not reflect the costs of sales, operating expenses, or other costs or expenses that must be deducted from the AUV figures to obtain your net income or profit.
- You should conduct an independent investigation of the costs and expenses you will incur in operating your Buffalo Wild Wings Sports Bar. Franchisees or former franchisees, listed in the disclosure document, may be one source of this information.
- Some outlets have sold this amount. Your individual results may differ. There is no assurance that you’ll sell as much.