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INTRODUCING THE NEXT NATIONAL POWERHOUSE FAST-FOOD CHAIN

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INTRODUCING THE NEXT NATIONAL POWERHOUSE FAST-FOOD CHAIN

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Everyone knows about McDonalds, Wendys, and Shake Shack, however, the name to watch out for in the coming months is The Chicken Shack. The Las Vegas-based, quick-service restaurant franchise now has 15 locations in five states across the West Coast. After an initial rebranding of the company in 2005, loyal customers built a community around The Chicken Shack, solely based upon word of mouth. The brand’s relationship with its customers has continued to grow organically with little marketing, which resulted in the preliminary investor and franchisee interest coming from customers who had been supporting the company for years. The company now has a documented history of positive return on investment for its franchise owners, as they continue to push the envelope with unique consumer targeting strategies such as social media, radio, and television. They are even beginning to utilize influencer and celebrity marketing on social media through their partnership with world-renowned marketing agency, B Wynn Sports. 

The business model is based upon selling large volumes of chicken fingers and wings, while also serving customers quicker than market leaders and competitors. The dining experience is quick and casual with customers usually staying less than thirty minutes per visit. 

The Chicken Shack has been acquiring more market share in the quick-service chicken industry with locations in Las Vegas, Washington, Colorado, California, and Oregon. This is not an exhaustive list of possible locations; A recent agreement with an international supplier means that any market around the world could be entered into with little supply chain disruption. This company offers a less expensive but still attractive alternative to opening a national chain. The initial opening costs are $100k-$250k depending on the building and equipment. There is an initial franchise fee of $30,000, and a royalty fee of 5% of the gross revenue each month to Chicken Shack LLC. Each unit averages $80k-$180k in monthly revenue. The target gross revenue for each store is one million dollars per year. Payroll and food cost will be the two main variable expenses, but net income is between 15%-20% on average. The scale in which chicken can be prepared and sold in The Chicken Shack is already competitive, but it can grow with the demand. 

When asking CEO, Jonathan Vitt, what his vision for the brand is over the course of the next 1-5 years, Vitt stated, “We want locations to be put in more populous places that have higher revenue ceilings. Our vision for the future involves more West Coast locations beyond the Las Vegas valley. Surrounding states are all prospective locations because there are relatively low barriers to entry and great opportunities for competitive margins. Drive-thru locations are also a driving factor for the future locations we hope to open ourselves or with new franchise owners. We think this model will increase the profits for future franchises, and give us a foothold in the U.S. chicken-based restaurant market. The future looks bright, and The Chicken Shack is ready to transition from a mom and pop local business to a national corporation that everyone can and will enjoy.” 

 

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