Semantics El D

The CFA "franchise model" not a true franchise model like most FF places. CFA basically owns the business and rents it to the franchisee and take a huge cut of the profits. They retain total quality control. Its basically a way to avoid managing a huge employee work force.

Nothing remotely like a true franchise model...

my previous office building was attached to a mall with that place and when we'd go eat there, it would be four meals for me per lunch, because I wouldn't eat dinner and I'd eat the other half for lunch the next day. sick value...

woah

And with all the new stores opening up you can imagine how much money they really take in to be growing so fast...

Chick filas by me are busy almost open to close...it's never not remotely busy

Well how much of the upkeep of the building are they accountable for? If in a normal place you're getting to keep 90% of the profits but building costs are 40% it's not that much of a difference.

Note: I have no idea what the numbers really look like and am curious.

If I'm reading right then there's actually not as big a difference as it sounds. A restaurant is doing pretty well if it's running a 20% pre-tax margin; in that scenario 50% of profit = 10% of sales. The bigger piece is the 15% of revenue for rent and equipment, but that sounds like a decent deal too if you don't have to put in any capital yourself.

I'm not sure what you can imbed here. There is an article in Forbes about The Cult of a Chik-fil-A. Very informative.

They're exactly like other franchisors with respect to the bolded. They're different than most systems in their capital investment and control of the real estate, but that doesn't impact standards enforcement much at all.

They can't and don't maintain "total quality control" because the franchises are independently managed (i.e., the store managers and employees are not CFA employees). This is identical to almost all systems.

What they do differently for standards enforcement is merely a matter of degree, using the same tools all f'ors do: training, inspections, and penalties.

The Pepper Jack Supreme Bagel has to be given consideration as an elite breakfast ff item.

I got mine toasted with cream cheese. It has melted cheese covering it that has a nice little kick from the peppers and the cream cheese goes well with it. It is surely very unhealthy. But it is very delicious.

In disbelief anyone gets bagels from DD, let alone someone from NYC

I know. But I was just getting an iced coffee and I am weak. They got me at pepper jack. Yes, I am a weak, pathetic fatso.

Too bad i dont have many of mentioned above fast food places in my city..

"Above" as in in the previous seventeen thousand posts? That is too bad.

Bacon egg and cheese on a multigrain bagel is pretty delicious

i think DD has somehow become underrated as well

Been going to DD for 30+ years and the quality is going down not up.

Heated cheddar twist is elite though.

The quality of what?

The donuts? I agree. But if you look at other things like coffee and variety of options those have improved greatly.

Donut quality way down. Bagels are horrible. Lately ice coffee quality way down. More options doesn't mean better quality just better selection.

Five Guys basically serves high quality hamburgers and fries. DD seems to be following the McDs plan, serve low quality food in all day parts.

http://www.buzzfeed.com/erinlarosa/t...about-in-n-out

Bought bag of whole bean coffee that I grind right as I make it. Was not impressed. Way to light roast.

That 4x4 looks delicious and I want it.

Anyone have Cookout orders for when they're not being value-conscious? I always just go with the tray. Not sure if there are items on the menu that I'm missing out on that are worthwhile.

All of the special burgers are awesome and not that expensive.

So in theory CFA takes 15% of sales and half of 15% EBITDA margin. Rent is going to be maybe 10-12%, and typically Franchise fees are 5-8%. If your depreciation, etc is 3-4% of sales, it's a little expensive but essentially in line.

What is not clear is if you get any sort of salary as the employee owner there before the net profit split. If not, then it's probably a bit out of line in CFA's favor, but since their average unit volumes are at the top of the industry, perhaps net income margin is higher and flow through to the owner is roughly in line with industry average.

What is very clear is that you are buying a job as a CFA franchisee. You can't have multiple stores or grow over time. It's just that store for you.