In this exclusive Franchise Chatter FDD Talk post, you’ll learn the following:
Section I – Estimated initial investment (franchise costs) for a Chicken Salad Chick franchise, based on Item 7 of the company’s 2023 FDD
Section II – Initial franchise fee, royalty fee, and marketing fee for a Chicken Salad Chick franchise, based on Items 5 and 6 of the company’s 2023 FDD
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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.Section III – Number of franchised and company-owned Chicken Salad Chick outlets at the start of the year and the end of the year for 2020, 2021, and 2022, based on Item 20 of the company’s 2023 FDD
Section IV – News updates on the Chicken Salad Chick franchise opportunity
Section V – Presentation and analysis of Chicken Salad Chick’s financial performance representations (average revenues and/or profits), based on Item 19 of the company’s 2023 FDD, including information on the:
- 2022 average, median, highest, and lowest gross sales for the 144 franchised and 54 affiliate-owned (separately stated) Chicken Salad Chick restaurants in the United States that were open and operating during all of 2022
- 2022 average gross sales, cost of goods sold, payroll & related costs, operating expenses, non-controllable expenses, occupancy costs, local marketing expense, brand fund fee, EBITDA, royalty fee, and adjusted EBITDA for the 54 affiliate-owned Chicken Salad Chick restaurants in the United States that were open and operating during all of 2022
Section VI – Key ratios, comparables, computations, and analyses for the Chicken Salad Chick franchise opportunity (exclusive content for Platinum subscribers)
Section I – Chicken Salad Chick Franchise Costs
- Chicken Salad Chick franchise costs, based on Item 7 of the company’s 2023 FDD:
- Initial Franchisee Fee: $50,000
- Grand Opening Marketing Fee: $10,000
- Rent (1 month) and Security Deposit: $6,000 to $11,000
- Leasehold Improvements: $400,000 to $500,000
- Furniture, Fixtures, and Equipment: $175,000 to $225,000
- Décor Package (wall art, table coverings, decals, window treatments): $15,000 to $20,000
- Branded Merchandise: $9,000 to $10,000
- Inventory: $12,000 to $13,000
- Signage: $12,000 to $25,000
- Drive-Thru Package (drive-thru only): $20,000 to $30,000
- Computer Equipment and Software: $20,000 to $30,000
- Permits and Licenses: $500 to $2,500
- Insurance (6 months): $2,500 to $3,500
- Training (transportation, lodging, etc. for 3 people): $2,500 to $5,000
- Other Deposits and Prepaid Expenses: $0 to $5,500
- Professional Fees (attorney, architect, etc.): $10,000 to $20,000
- Additional Funds for 3 Months: $20,000 to $30,000
- Total Chicken Salad Chick Franchise Costs (all locations other than drive-thru locations): $744,500 to $960,500
- Total Chicken Salad Chick Franchise Costs (drive-thru locations only): $764,300 to $990,500
Section II – Chicken Salad Chick’s Initial Franchise Fee, Royalty Fee, and Marketing Fee
- Chicken Salad Chick’s initial franchise fee, royalty fee, and marketing fee, based on Items 5 and 6 of the company’s 2023 FDD:
- Franchise Fee: $50,000 for first location; $45,000 for additional locations
- Continuing Royalty: 5% of Gross Sales (but at least $600 on the 5th and 20th of each month)
- Advertising Contribution: currently, 2% of Gross Sales
Section III – Number of Franchised and Company-Owned Chicken Salad Chick 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: 131
- Net Change: +29
2021
- Outlets at the Start of the Year: 131
- Outlets at the End of the Year: 153
- Net Change: +22
2022
- Outlets at the Start of the Year: 153
- Outlets at the End of the Year: 159
- Net Change: +6
Company-Owned
2020
- Outlets at the Start of the Year: 42
- Outlets at the End of the Year: 45
- Net Change: +3
2021
- Outlets at the Start of the Year: 45
- Outlets at the End of the Year: 52
- Net Change: +7
2022
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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.📈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: 52
- Outlets at the End of the Year: 66
- Net Change: +12
Section IV – News Updates on the Chicken Salad Chick Franchise
Section V – Financial Performance Representations (Average Revenues and/or Profits) for the Chicken Salad Chick Franchise (Item 19, 2023 FDD)
- This historical financial performance representation discloses the average, median, and high/low annual gross sales of 144 franchised (Part 1) and 54 affiliate-owned (Part 2) Chicken Salad Chick Restaurants in the United States that were open and operating during all of 2022.
- All affiliate-owned Chicken Salad Chick Restaurants disclosed in this Item 19 are owned and operated by Chicken Salad Chick’s affiliate SSRG II, LLC.
- Of the 54 affiliate-owned Restaurants, 3 Restaurants (in Florida) were acquired from a franchisee by Chicken Salad Chick’s affiliate SSRG II, LLC on January 23, 2022. Because SSRG II, LLC owned and operated these 3 Restaurants for almost all of 2022, their operating results are included with SSRG II, LLC’s other Restaurants.
- This financial performance representation does not include the results of 31 Chicken Salad Chick Restaurants:
- (1) 15 franchised Restaurants and 9 affiliate-owned Restaurants that opened during 2022 (and therefore were not open for the full calendar year);
- (2) 4 franchised Restaurants that permanently closed during 2022 (and therefore were not open for the full calendar year);
- (3) 1 affiliate-owned Restaurant operated on a college campus in Alabama that is not open year-round; and
- (4) 2 franchised Restaurants (both in Georgia) that were acquired by Chicken Salad Chick’s affiliate SSRG II, LLC during 2022. (These 2 Restaurants are excluded from this Item 19 because their operations during 2022 were substantially split between the franchisees and Chicken Salad Chick’s affiliate.)
- Besides the annual gross sales of the 144 franchised and 54 affiliate-owned Chicken Salad Chick Restaurants in the United States that were open and operating during all of 2022, this financial performance representation contains an actual average and median partial operating financial statement for 2022 for the affiliate-owned and operated Chicken Salad Chick Restaurants (Part 3).
- All of the Chicken Salad Chick Restaurants (both franchised and affiliate-owned) whose information is included in this Item 19 are both substantially similar to one another in terms of products and services offered and substantially similar to the Chicken Salad Chick Restaurants for which Chicken Salad Chick is offering franchises in the disclosure document.
- Chicken Salad Chick did not materially change the Chicken Salad Chick Restaurant franchise concept or business model due to the COVID-19 pandemic.
- Chicken Salad Chick obtained the gross sales information for franchised Restaurants from sales reports submitted by franchisees.
- “Gross Sales” is defined as the amount of all sales of food, beverages, and services by a Restaurant, including off-premises or on-premises catering sales, less applicable sales tax. All coupons and discounts are deducted and netted out from Gross Sales.
- Chicken Salad Chick obtained the detailed Restaurant-level operating information for affiliate-owned Restaurants from SSRG II, LLC. Chicken Salad Chick has not independently audited any information submitted to it.
- The actual average, median, and high/low annual gross sales volumes reported below do not reflect the costs of sales, operating expenses, or other costs or expenses that must be deducted from the gross sales figures to obtain your net income or profit.
Part 1 – Franchised Restaurants (Sales)
- Number of Restaurants in Range: 144
- 2022 Average Unit Volume: $1,406,088
- 2022 Highest Sales: $2,490,082
- 2022 Lowest Sales: $550,718
- Number and Percentage of Restaurants Exceeding Average: 64 / 44%
- 2022 Median Unit Volume: $1,360,651
Part 2 – Affiliate-Owned Restaurants (Sales)
- Number of Restaurants in Range: 54
- 2022 Average Unit Volume: $1,429,041
- 2022 Highest Sales: $2,448,550
- 2022 Lowest Sales: $678,785
- Number and Percentage of Restaurants Exceeding Average: 30 / 56%
- 2022 Median Unit Volume: $1,450,724
Part 3 – Average Partial Operating Financial Statement for Affiliate-Owned and Operated Restaurants
Total Gross Sales: $1,429,041 (100.00%)
Prime Costs
- Total Cost of Goods Sold: $495,797 (34.69%)
- Total Payroll & Related: $381,828 (26.72%)
- Total Prime Costs: $877,625 (61.41%)
Total Operating Expenses: $99,273 (6.95%)
Total Non-Controllable Expenses: $64,086 (4.48%)
Total Occupancy Costs: $123,529 (8.64%)
Local Marketing Expense: $41,805 (2.93%)
Brand Fund Fee: $28,581 (2.00%)
EBITDA: $194,143 (13.59%)
Royalty Fee: $71,452 (5.00%)
Adjusted EBITDA: $122,691 (8.59%)
Subset of ” Total Payroll & Related” Above:
- Total Restaurant Level Salary: $110,312 (7.72%)
- Total Cost of Goods Sold: This includes the cost of all food, beverages, delivery services, and paper goods used in the Restaurants. A franchisee in a new market with less than 3 open Restaurants could expect that its Cost of Goods Sold will be higher, likely ranging between an additional 1% and 2% of total sales. Some proprietary items might not be stocked by Chicken Salad Chick’s local distributor, causing an increase in freight costs.
- Total Payroll & Related: This includes all salaries, hourly wages, bonuses, payroll taxes, and benefits paid at each affiliate-owned Restaurant.
- Total Prime Costs: This is the sum of Cost of Goods Sold plus Payroll & Related.
- Total Operating Expenses: These include disposables, restaurant supplies, travel expenses, cleaning supplies, linen, uniforms, pest control, delivery expense, music, technology, permits, licenses, office supplies, postage, equipment rental, trash removal, and professional services.
- Total Non-Controllable Expenses: These include bank fees, phone and internet, utilities, and repairs and maintenance.
- An additional non-controllable expense is the cost of chicken, a main ingredient for Chicken Salad Chick Restaurants. In 2022, the price of jumbo chicken tenders began at $2.52 per pound and increased during the first 5 months to a 9-year high of $3.46 a pound, remaining at this price for approximately 10 weeks before beginning to decline. As a comparison, the price for the same ingredient at the end of the first quarter of 2023 was approximately $1.32 per pound.
- Total Occupancy Costs: These include base rent, common area maintenance, property taxes, and insurance.
- Brand Fund Fee: Each affiliate-owned Restaurant contributes to the Brand Fund the same 2% of gross sales contributed by franchisees.
- The EBITDA calculation uses the following formula: Total Gross Sales minus (i) Total Prime Costs, (ii) Total Operating Expenses, (iii) Total Non-Controllable Expenses, (iv) Total Occupancy Costs, and (v) Local Marketing Expense and Brand Fund Fee = EBITDA.
- Royalty Fee: Affiliate-owned Restaurants do not pay Royalties. This line-item represents the Royalty Fee of 5% that franchisees would pay had they operated these Restaurants under Chicken Salad Chick’s Franchise Agreement.
- Adjusted EBITDA: This calculation is EBITDA minus Royalty Fee.
- Some Chicken Salad Chick Restaurants have earned these amounts. Your individual results may differ. There is no assurance that you will earn as much.
Section VI – Chicken Salad Chick Franchise Ratios, Comparables, Computations, and Analyses (Exclusive Content for Platinum Subscribers) ⬇️
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