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Franchisee Health
& Development
& Development
David Karam
President
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Improved Restaurant Margins
2008
2010
+320 bps
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— Monthly store level business reviews
— National contracting for repair and maintenance
— Better utility management
— Improved reporting tools to control food waste
— More efficient labor usage
Achieving Margin Improvement
through Managing Expenses
through Managing Expenses
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more effective benchmarking
fosters innovation
identifies best practices
identifies strong performers
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Pricing Model - Example
Projected Impact of Price Increase per Store - U.S. Company Stores
Stores Expected to
See Sales Decline
See Sales Decline
Number of Sites
252
503
755
1,006
1,258
Breakeven Point
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Sales and Gross Profit Projection - Example
Annual Impact without Pricing Model | Annual Impact with Pricing Model | |||
SALES | ||||
78% stores benefit from price increase | $ 8,900,000 | $ 8,900,000 | ||
22% stores hurt by price increase | (5,100,000) | - | ||
Total Sales | $ 3,800,000 | $ 8,900,000 | ||
Total % impact on sales | 0.2% | 0.6% | ||
OPERATING PROFIT | ||||
78% stores benefit from price increase | $ 6,700,000 | $ 6,700,000 | ||
22% stores hurt by price increase | (3,600,000) | |||
Total Operating Profit | $ 3,100,000 | $ 6,700,000 |
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Generating Significant Savings
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Development Opportunity
North American Restaurant Count - FY 2009
6,248
15,480
7,549
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Managing Our Restaurant Portfolio
New Unit
Capital
Capital
Remodeling
Capital
Capital
New Unit
Capital
Capital
Remodeling
Capital
Capital
COMPANY
RESTAURANTS
RESTAURANTS
FRANCHISE
RESTAURANTS
RESTAURANTS
A
B
C
D
E
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B
C
D
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Capital Gains
New
Franchisees
Franchisees
Cash
Exit
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CRITICAL
MEASURES
MEASURES
Financial Health
of Franchise
System
of Franchise
System
SALES
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U.S. Franchise Operating Profit and Cash Flow
+150 bps
2008
2009
+65%
Operating Profit
EBITDA
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2003
2004
2005
2006
2007
2008
2009
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Facility
Remodels
Remodels
Next Generation
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Key Growth Drivers
— Grow same-store sales
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Key Growth Drivers
— Grow same-store sales
— Expand dayparts
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Key Growth Drivers
— Grow same-store sales
— Expand dayparts
— New stores, remodels and
portfolio management
portfolio management
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Key Growth Drivers
— Grow same-store sales
— Expand dayparts
— New stores, remodels and
portfolio management
portfolio management
— International expansion