Steak ‘n Shake, willing to shift more of its restaurants to franchise ownership, is now selling partnerships in all of its more than 400 company-owned restaurants for an initial investment of $10,000. That’s a fraction of the typical investment for a Steak ‘n Shake restaurant. Initial investment on a “classic format” Steak ‘n Shake ranges from $1.6 million to $2.6 million, based on the company’s franchise disclosure documents.
Qualified operators would need to complete a comprehensive six-month training course and would pay for the $10,000 to get in to the partnership. They might then be single-unit owner-operators. A spokesperson for see the Steak and Shake menu with prices here said that the program is to convert all of the company’s corporate locations into these franchise partnerships.
The franchise partner would get 50% from the restaurant’s profits. The organization did not respond to questions concerning who will be accountable for the expenses related to building and site improvements. “I started my company with $15,000 and built a thriving enterprise,” Sardar Biglari, CEO of Steak ‘n Shake owner Biglari Holdings, said in a statement. “I wish to provide the opportunity to other entrepreneurs that are highly motivated to excel but do not have the financial means.”
“What will be important to become a franchisee is not great capital but great ability,” he added. “We are trying to find to harness the power of entrepreneurs and to produce a company of owners.” Biglari has wanted to shift the largely company-run Steak ‘n Shake into even more of a franchise business for years. The business owns and operates roughly two-thirds of the company’s more than 600 locations.
“Our prospects in franchise operations-domestic and international-look bright,” Biglari wrote earlier this year within his annual letter to shareholders. But franchisees will be buying into a brand which includes struggled lately. The chain’s same-store sales declined 3.4% in the quarter ended June 30, including a 6.4% decline in traffic. That came following a tough 2017 that Biglari called “not an excellent year” and “lugubrious” in the letter.
A number of restaurant brands sell partnerships to owner-operators who then share in the profits. The most notable example is Atlanta-based chicken chain Chick-fil-A. “I started my company with $15,000 and built a thriving enterprise,” said Sardar Biglari, CEO of Biglari Holdings, owner of Steak ‘n Shake, in a statement. “I desire to provide an opportunity to other entrepreneurs that are highly motivated to excel but lack the financial means. What is going to make a difference to turn into a franchisee is not great capital but great ability. Our company is seeking to harness the effectiveness of entrepreneurs and to produce a company of owners.”
Steak ‘n’ Shake added that the offering to get in to the company being a franchise partner requires operators to successfully complete a six-month training curriculum. The franchise partner would then get 50 percent in the restaurant’s profits. This can be a partnership, shared-profit deal like the system Chick-fil-A deploys.
Steak ‘n’ Shake is looking to quickly shift its business model coming from a heavy corporate-owned structure to your system run mostly by single-unit franchisees. The company said this would “achieve operational tpjpgz by marshaling the efforts and strengths of entrepreneurs.” Founded in 1934 in Normal, Illinois, Steak ‘n Shake had 173 franchised domestic units and 412 company-run stores in 2017, that was a total increase of 17 from the previous year. The business posted average-unit volumes of $1,839.51 (in thousands) along with total systemwide sales of $939.99 (in millions). The entire year before, https://www.storeholidayhours.org/steak-n-shake-holiday-hours-open-closed-today/ had 568 total domestic units (415 company-run) after adding 17 restaurants from the previous year. It had higher AUV ($1.9M) and increased systemwide sales of $1,027 (in millions).