In this exclusive Franchise Chatter FDD Talk post, you’ll learn the following:
Section I – Estimated initial investment (franchise costs) for a Sonic Drive-In franchise, based on Item 7 of the company’s 2023 FDD
Section II – Initial franchise fee, royalty fee, and marketing fee for a Sonic Drive-In franchise, based on Items 5 and 6 of the company’s 2023 FDD
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Section IV – News updates on the Sonic Drive-In franchise opportunity
Section V – Presentation and analysis of Sonic Drive-In’s financial performance representations (average revenues and/or profits), based on Item 19 of the company’s 2023 FDD, including information on the:
- 2018, 2019, 2020, 2021, and 2022 average gross sales for the company Sonic Drive-Ins, franchise Sonic Drive-Ins, and all Sonic Drive-Ins (company and franchise) that were open and operating for the entire year
- 2022 average gross sales for traditional company Sonic Drive-Ins, traditional franchise Sonic Drive-Ins, and all traditional Sonic Drive-Ins (company and franchise) that were open and operating for the entire 2022 fiscal year
- 2022 average gross sales for traditional Sonic Drive-Ins (company and franchise) that were open and operating for the entire 2022 fiscal year, by gross sales level (top third, middle third, and bottom third)
- 2022 average gross sales for traditional Sonic Drive-Ins (company and franchise) that were open and operating for the entire 2022 fiscal year, by geographic region (Midwest, Northeast, South, and West)
- 2022 average gross sales for traditional franchise Sonic Drive-Ins at convenience store locations that were open and operating for the entire 2022 fiscal year, by gross sales level (top third, middle third, and bottom third)
Section VI – Key ratios, comparables, computations, and analyses for the Sonic Drive-In franchise opportunity (exclusive content for Platinum subscribers)
Section I – Sonic Drive-In Franchise Costs
- Sonic Drive-In franchise costs, based on Item 7 of the company’s 2023 FDD:
- Initial License Fee: $45,000
- Travel and Living Expenses During Training: $8,200 to $93,600
- Franchisee Certified Training Team Expenses: $15,200 to $42,500
- Prepaid Expenses: $2,000 to $125,000
- Real Property/Occupancy Charge: variable
- Building Costs: $800,000 to $1,100,000
- Site Work: $450,000 to $1,200,000
- Restaurant Equipment: $175,000 to $260,000
- Point-of-Sale System (“POS”), Digital Menu Housings (“POPS”), and Other Technology: $105,000 to $160,000
- External Signage: $50,000 to $150,000
- Beginning Inventory: $20,000 to $50,000
- Advertising Funds: $2,000 to $5,000
- Insurance Premiums: $10,000 to $20,000
- Payroll: $26,800 to $94,800
- Additional Funds (3 months): $5,000 to $25,000
- Total Estimated Sonic Drive-In Franchise Costs (excluding free-standing real estate costs): $1,714,200 to $3,370,900
Section II – Sonic Drive-In’s Initial Franchise Fee, Royalty Fee, and Marketing Fee
- Sonic Drive-In’s initial franchise fee, royalty fee, and marketing fee, based on Items 5 and 6 of the company’s 2023 FDD:
- Initial License Fee: $45,000
- Royalty Fee: 5% of Gross Sales
- Brand Fee/Sonic Brand Fund Contribution: 0.90% of Gross Sales
- Advertising Cooperative Fee/System Marketing Fund Contribution: 3.25% of Gross Sales for Traditional Restaurants; 3.00% of Gross Sales for Non-Traditional Restaurants
Section III – Number of Franchised and Company-Owned Sonic Drive-In Outlets
Franchised
2020
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When I owned a UPS Store, I learned firsthand how much your ZIP code shapes your outcome. I sold my store at a premium because my territory was in a high-value area. The best areas go first, and once they're gone, they're gone. Enter your ZIP code, and a territory specialist will walk you through the franchises still available near you, drawing on information that isn't publicly accessible, saving you months of wasted research.🔴Free Webinar: 6 Under-the-Radar Franchise Concepts That Serious Buyers Should Know
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- Outlets at the End of the Year: 3,251
- Net Change: -78
2021
- Outlets at the Start of the Year: 3,251
- Outlets at the End of the Year: 3,232
- Net Change: -19
2022
- Outlets at the Start of the Year: 3,232
- Outlets at the End of the Year: 3,221
- Net Change: -11
Company-Owned
2020
- Outlets at the Start of the Year: 197
- Outlets at the End of the Year: 271
- Net Change: +74
2021
- Outlets at the Start of the Year: 271
- Outlets at the End of the Year: 320
- Net Change: +49
2022
🎯Find Best-Fit Franchises Still Available in Your Target Area (Free Tool)
When I owned a UPS Store, I learned firsthand how much your ZIP code shapes your outcome. I sold my store at a premium because my territory was in a high-value area. The best areas go first, and once they're gone, they're gone. Enter your ZIP code, and a territory specialist will walk you through the franchises still available near you, drawing on information that isn't publicly accessible, saving you months of wasted research.📈Dreaming of Multi‑Unit Success? Lock In Prime Territories Before They're Gone.
Colin started as a team member at 21 and now owns 6 locations in Tampa Bay. Lisa came from marketing and built 21 in San Diego. The most successful multi-unit owners move early and secure markets with room to grow. Use our free tool to search multiple ZIP codes and find franchises where you can still stack locations, before someone else does. A franchise specialist will be in touch to present what's available.- Outlets at the Start of the Year: 320
- Outlets at the End of the Year: 325
- Net Change: +5
Section IV – News Updates on the Sonic Drive-In Franchise
Section V – Financial Performance Representations (Average Revenues and/or Profits) for the Sonic Drive-In Franchise (Item 19, 2023 FDD)
- This Item 19 includes financial information from Sonic’s 2022 fiscal year, which is the period from January 3, 2022 until January 1, 2023; from Sonic’s 2021 fiscal year, which is the period from January 4, 2021 until January 2, 2022; from Sonic’s 2020 fiscal year, which is the period from December 30, 2019 until January 3, 2021; and from the 2018 and 2019 calendar years (from January 1 until December 31 of each year).
- This Item 19 contains the actual, historical average gross sales of certain Sonic Restaurants for Sonic’s 2022 fiscal year, 2021 fiscal year, 2020 fiscal year, and the 2019 and 2018 calendar years. This Item 19 also contains the actual, historical average gross sales for certain Sonic Restaurants for the 2022 fiscal year by gross sales level, type, and geographic region.
Types of Sonic Drive-Ins
- A typical “Traditional Sonic Drive-In” is a Sonic Drive-In where a customer parks in a covered drive-in space and orders through an intercom speaker system. A carhop then delivers the customer’s food directly to the customer’s vehicle.
- Most Traditional Sonic Drive-Ins are freestanding buildings and include a drive-thru lane and a patio, and sometimes also an enclosed patio or indoor seating.
- Some Traditional Sonic Drive-Ins are located at convenience stores or travel plazas (“C-stores”).
- Traditional Drive-Ins are located across the country and in a variety of urban, suburban, and rural locations.
- Traditional Sonic Drive-Ins (other than C-stores) without inside seating typically range in size from 1,100 to 1,700 square feet, including stalls and drive thru, although there are some atypical Traditional Sonic Drive-Ins whose size falls outside this range.
- Traditional Sonic Drive-Ins (other than C-stores) with inside seating typically range from 2,000 to 4,000 square feet.
- The size of Traditional Sonic Drive-Ins that are C-store locations varies with the type of location and ranges from 1,000 to 3,000 square feet.
- A “Non-Traditional Sonic” is a Sonic Restaurant operated at a location such as a food court at a football stadium, mall, military base, or other non-traditional location.
- Non-Traditional Sonics typically range in size from 800 to 1,500 square feet, although there are some atypical Non-Traditional Sonics whose size falls outside this range.
- “Company Drive-Ins” are Sonic Restaurants that SRI, the franchisor’s affiliate, owns and operates, or that a partnership or limited liability company in which SRI owns a majority interest owns and operates.
- “Franchise Drive-Ins” are Sonic Restaurants that Sonic’s franchisees own and operate.
- Sonic’s affiliate periodically buys Sonic Restaurants from and sells Sonic Restaurants to franchisees. For transactions during its 2022 fiscal year and its 2021 fiscal year, Sonic includes the restaurants as Company Drive-Ins if its affiliate owned and operated the restaurants for the majority of the year, and it includes the restaurants as Franchise Drive-Ins if a franchisee operated the restaurants for the majority of the year.
- For the transactions from 2018 through 2019, Sonic included any Sonic Restaurant that its affiliate bought from or sold to any franchisee during the year as a Franchise Drive-In, regardless of when that purchase or sale happened during the year.
- Sonic calculated the figures in this Item 19 using information that its affiliates and franchisees provided. Sonic derived the gross sales of Franchise Drive-Ins from unaudited monthly financial reports that franchisees submitted to compute royalty fees. Sonic used gross sales data that it collected from franchisees’ POS systems to cover any monthly financial reports that franchisees failed to submit.
- Sonic’s 2022 fiscal year contained 53 weeks, so for the financial performance representations covering the 2022 fiscal year, Sonic removed the Gross Sales from the 53rd week in order to show an accurate year-over-year comparison.
Part 1 – Average Gross Sales for 2018-2022
2022 Fiscal Year – Average Gross Sales
- Company Drive-Ins (319 restaurants): $1,318,000
- Franchise Drive-Ins (3,133 restaurants): $1,608,000
- Total of Company Drive-Ins and Franchise Drive-Ins (3,452 restaurants): $1,581,000
2021 Fiscal Year – Average Gross Sales
- Company Drive-Ins (271 restaurants): $1,374,000
- Franchise Drive-Ins (3,184 restaurants): $1,708,000
- Total of Company Drive-Ins and Franchise Drive-Ins (3,455 restaurants): $1,681,000
2020 Fiscal Year – Average Gross Sales
- Company Drive-Ins (267 restaurants): $1,346,000
- Franchise Drive-Ins (3,200 restaurants): $1,633,000
- Total of Company Drive-Ins and Franchise Drive-Ins (3,467 restaurants): $1,611,000
2019 Calendar Year – Average Gross Sales
- Company Drive-Ins (169 restaurants): $1,272,000
- Franchise Drive-Ins (3,154 restaurants): $1,345,000
- Total of Company Drive-Ins and Franchise Drive-Ins (3,323 restaurants): $1,341,000
2018 Calendar Year – Average Gross Sales
- Company Drive-Ins (170 restaurants): $1,204,000
- Franchise Drive-Ins (3,316 restaurants): $1,268,000
- Total of Company Drive-Ins and Franchise Drive-Ins (3,486 restaurants): $1,265,000
Part 2 – Breakdown of Average Gross Sales for 2022
Traditional Franchise Drive-Ins, by Gross Sales Level – Average Gross Sales (2022 Fiscal Year)
- Top Third (1,044 restaurants): $2,289,000
- Middle Third (1,043 restaurants): $1,527,000
- Bottom Third (1,044 restaurants): $1,011,000
- Total (3,129 restaurants): $1,609,000
Traditional Company Drive-Ins, by Gross Sales Level – Average Gross Sales (2022 Fiscal Year)
- Top Third (106 restaurants): $1,826,000
- Middle Third (106 restaurants): $1,232,000
- Bottom Third (106 restaurants): $900,000
- Total (319 restaurants): $1,318,000
All Traditional (Franchise and Company) Drive-Ins, by Gross Sales Level – Average Gross Sales (2022 Fiscal Year)
- Top Third (1,149 restaurants): $2,256,000
- Middle Third (1,150 restaurants): $1,497,000
- Bottom Third (1,149 restaurants): $995,000
- Total (3,448 restaurants): $1,582,000
All Traditional (Franchise and Company) Drive-Ins, by Geographic Location – Average Gross Sales (2022 Fiscal Year)
- Midwest (484 restaurants; 14% of total): $1,564,000
- Northeast (65 restaurants; 2% of total): $1,607,000
- South (2,485 restaurants; 72% of total): $1,574,000
- West (414 restaurants; 12% of total): $1,682,000
- Total (3,448 restaurants; 100% of total): $1,582,000
Traditional Franchise Drive-Ins at C-Store Locations, by Gross Sales Level – Average Gross Sales (2022 Fiscal Year)
- Top Third (18 restaurants): $1,642,000
- Middle Third (17 restaurants): $1,071,000
- Bottom Third (18 restaurants): $687,000
- Total (53 restaurants): $1,126,000
Section VI – Sonic Drive-In Franchise Ratios, Comparables, Computations, and Analyses (Exclusive Content for Platinum Subscribers) ⬇️
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