News

Technomic: Franchising key to sales growth

July 29, 2008

CHICAGO — A new report from foodservice consultants Technomic found that many top restaurant chains grew their 2007 sales through signing more franchisees, instead of relying on same-store sales increases. This held true for both limited-service and full-service sectors.

"Restaurant chains are facing an increasingly challenging environment and higher costs," said Darren Tristano, executive vice president of Technomic Information Services. "Expansion through franchising transfers some of the downside risk of a slowing economy to the franchisees, while the franchisees benefit from managing a restaurant brand that is tried and true both operationally and with its consumer base."

Technomic teamed with Restaurant Finance Monitor to produce theTechnomic/Restaurant Finance Monitor Top 400 Restaurant Franchise Company Report, featuring Restaurant Finance Monitor's Monitor 200 report, which ranks the 200 leading restaurant franchise companies by sales. In addition, Technomic reports on the Future 200—a ranking of the 201 through 400 leading restaurant franchise companies. Select findings include:

The Top 400 restaurant franchisees generated $31 billion in sales in 2007, about 8.5 percent of the total restaurant industry's $364 billion.
Burger King, Taco Bell and McDonald's were the restaurant brands most often franchised.
NPC International, a major franchisee of Pizza Hut, was the largest franchise company in 2007, with sales of $679 million, up 12.9 percent over 2006.

To purchase or learn more about theTechnomic/Restaurant Finance Monitor Top 400 Restaurant Franchise Company Report, visitwww.foodpubs.com.