🍟 2/28/2022 – A New Restaurant Franchise With 20% Margins
The Robots are Coming
Quick service restaurants are embracing technology in a big way:
- White Castle is putting robots into 1/3 of its stores
- Pizza Hut recently opened the first automated store in Israel
- Jamba Juice is putting autonomous smoothie kiosks on college campuses
- Brooklyn Dumpling Shop opened it’s first automated franchise in Connecticut
The Wolf’s Take
With labor shortages a real issue across all sectors at the moment, it’s easy to see the benefits of robots and automation in a business.
Whether it’s a burger flipping robot or a fully automated drink dispenser like Jamba Juice has, these machines have the potential to offer 24-7 operations to franchise owners.
And while they may require maintenance from time to time, they’ll never call out sick!
Major technological shifts do take time to adopt, but I’m starting to pay closer attention to this when it comes to QSR’s. If you’re looking into restaurant franchises, even if they cannot offer automation today, it’s time to start thinking 5-10 years down the road to see how automation could improve the business model.
Taco Bell Sees More Traffic After Betting on Subscription Model
Netflix, Spotify, Disney+…why not throw a taco subscription in there?
FRANCHISE OF THE WEEK
- Founded: 1994
- Units Open: 1,624
- Investment Range: $347,600 – $759,100
- Average Revenue per Location: ~$1,250,000
Did You Know?
Famous rapper Rick Ross loves Wingstop so much, that he decided to buy a few franchises…25 of them actually
- Founded in 2018, franchising since 2019
- Based in Washington DC; 5 locations open as of 2022
- A restaurant that provides toast-style meals, fruit bowls, juices, & smoothies
Fees + Investment
- Royalty: 5.5% of gross sales
- Brand Fund: 2% of gross sales
- Franchise Fee: $45,000
- Initial investment: $347,250 – $568,700
- The below information contains performance data 2 separate company owned locations
The Wolf’s Take
Folks, what can I say…I like this franchise. 20% margins for a restaurant, AFTER royalties mind you, is pretty darn good. They can operate in a small sq foot print, as the 2 locations shown above are both between 1,000-1,100 sq ft.
The concept is also well positioned to operate at each time of day. Customers can get an early on-the-go breakfast, a corporate lunch in the afternoon, and a post-workout fuel-up in the evening.
Obviously juices, smoothies, and acai bowls were already popular in 2018 when they launched, but they’ve still been able to differentiate their menu by turning toast into a gourmet menu option.
If “gourmet toast” sounds a little ridic…I get it. I live in Manhattan and there’s no shortage of over-priced avocado toast options. But Toastique offers some tasty toppings on it’s toast dishes – check out the 3 cheese Italian with prosciutto below .
If you’re still not sold, the DC market (where they’re based) seemed to love it from the get-go, as Toastique won the award for best new restaurant in 2019.
It’s a young brand with a young founder (Forbes 30 under 30 winner), and I think it’s a restaurant that can thrive in metro areas and upscale suburbs too.
Check it out before the rest of the country discovers em’.
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