Ranking the Biggest Franchise Owners in the U.S. Units Shift As M&A Fuels Growth Among Restaurant 200 Operators
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Ranking the biggest franchise owners in the U.S. Units shift as M&A fuels growth among Restaurant 200 operators he Restaurant 200 reflects operators, the largest franchisee many of the major trends groups continued rapid growth. Tin the restaurant industry, The top 10 companies now The Top 2OO Operators Command one being the big continue to account for $11 billion in sales grow. But the industry is facing with an additional $158 million • $42.0 billion in revenue real change and difficulty even added in 2019. There was also • 30,124 restaurants at the top. These year-end 2019 plenty of growth beyond the top numbers serve as one final bench- 10. In fact, the next 190 restau- • Top 5 firms combine for $7.5 billion in sales mark for the industry before the rant operators grew even faster. COVID-19 pandemic changed The percentage of sales in the everything. top 10 accounted for 27 percent Flynn Restaurant Group of the overall sales in the group The 10 Sellers of the Restaurant 200 maintains its No. 1 position for of $42 billion, down slightly the ninth year in a row. But it was from 28 percent last year. That Rank LY Company Units 2018 a down year for the California- marks a switch in a five-year based restaurant giant. The com- sales trend that heavily favored 76 QK Holdings 91 Denny’s, 9 Del Taco pany shed seven Applebee’s and the largest operators. Diversified 78 64 Buffalo Wild Wings sales dipped by $5 million. Flynn The average operator on the Restaurant Holdings added one Arby’s, five Taco Bell Restaurant 200 has $210 mil- 95 Four Foods Group 72 Little Caesars, 49 Kneaders units and a single Panera. lion in revenue and oversees 151 Wisconsin NPC International retains the locations. That’s up from $202 128 34 Applebee’s, 31 Pizza Hut No. 2 spot even as it struggled million and 143 units last year. Hospitality Group with finance issues in 2019. The 147 Ultra Steak 22 Little Caesars, 13 Texas Roadhouse company grew to $1.6 billion All together now 160 McEssy Investment Co. 23 McDonald’s in sales, a $67 million increase Mergers and acquisitions in the self-reported numbers. shifted hundreds of restaurants 161 Ocedon 62 Burger King But even that wasn’t enough to around on the Restaurant 200 185 Southwest Deli Group 33 McAlister’s Deli stave off liquidity issues. The list. In all, 10 of the top 200 com- company faced a credit rating panies sold the entirety of their 191 FOR Northwest 38 Burger King downgrade from Moody’s and operations. The largest was QK 195 Lunan Corporation 37 Arby’s filed for bankruptcy protection Holdings, which reported $154 midway through 2020. million in sales in 2018 and Carrols Restaurant Group ranked No. 76 on last year’s list- Others on the list of sellouts largest Burger King operator and continued to expand, and the ing. The Denny’s and Del Taco or near sellouts were McEssy No. 3 on the ranking, added 187 company was the top sales operator sold all of its 94 Denny’s Investment Co., which sold many BK restaurants and 65 Popeyes, grower in the rankings. The mas- locations to WKS Restaurant of its 23 McDonald’s locations. contributing to its sales growth. sive Burger King operator added Group (No. 17). The next largest, No. 165 Ocedon sold most of the Sun Holdings’ acquisition of $273 million in sales. For some Diversified Restaurant Holdings Burger King locations it operated, 51 McAlister’s locations repre- context, that level of sales alone (No. 78), was taken private and No. 195 Lunan Corp. sold sented another trend as the larg- would put an operator solidly at when private equity firm ICV most of its Arby’s stores. est operators diversify with new No. 39 on the ranking. Partners took over the company’s The common theme among brands within their markets. The The Dhanani 64 Buffalo Wild that group was great prices for Dallas-based company run by Group in Sugar Wings locations. active consolidation companies. Guillermo Perales already has Land, Texas comes By Nicholas Upton Four Foods Despite ongoing industry hard- 290 Burger Kings, so taking on in at No. 4 with Research by Group, the No. 95 ships, including rising labor costs a new concept, complex or not, an estimated $1.1 Matt Haskin operator last year, and lagging traffic, prices for the starts to make sense. billion in sales, and Max Wolf unloaded all of its right brands remained high. The WKS Restaurant Group added and Sun Holdings franchise locations decision between investing in $169 million in sales, much of jumps to No. 5 and became a pri- remodels and updates or cash- that from its Denny’s acquisition, from the No. 9 position last vate equity fund itself. The Salt ing out has been top of mind for along with six Krispy Kremes year. The company added $206 Lake City-based operator behind operators in the last few years. and five El Pollo Loco restau- million in sales (the second the expansion of Kneaders and In all, 24 companies on the rants. The operator grew sales by most aggressive sales growth) also a major Little Caesars fran- Restaurant 200 opted to sell all nearly 60 percent, making it the through 2019 as it acquired 51 chisee now invests in fledgling or the vast majority of their oper- strongest percentage sales growth McAlister’s Delis. restaurant and food-retail con- ations in the last two years. Large leader within the top 200. While there were shifts and cepts with an aim to scale under franchisees, meanwhile, continue disruptions among the top the name Savory. to buy more scale. Carrols, the August 2020 | Franchise Times 33 15 K-Mac Enterprises Fort Smith, AR Franchise Times $484,988,000 289 Taco Bell Restaurant 200: Top 20 6 Golden Corral 11 YUM! Multi Sun Holdings secured 16 Meritage a spot in the top 5 1 Flynn Restaurant Group 10 Pacific Bells Hospitality Group this year. The Burger San Francisco, CA Vancouver, WA Grand Rapids, MI King operator added $2,338,356,000 $652,000,000 $467,700,000 51 McAlister’s in a 451 Applebee’s 240 Taco Bell 331 Wendy’s 369 Arby’s 67 Buffalo Wild Wings diversifying acqui- 264 Taco Bell 17 WKS Restaurant Group sition—one of the 11 GPS Hospitality Cypress, CA brand’s largest deals 2 NPC International Atlanta, GA $466,063,000 so far. The company Leawood, KS $623,097,000 127 Denny’s also added $206 $1,611,849,000 402 Burger King 66 El Pollo Loco million in sales to 1,229 Pizza Hut 73 Pizza Hut 54 Wendy’s become the second- 393 Wendy’s 19 Popeyes largest sales grower. 18 Doherty Enterprises 3 Carrols Restaurant Group 12 Yadav Enterprises Allendale, NJ Syracuse, NY Fremont, CA $464,341,000 $1,452,516,000 $596,421,000 96 Applebee’s 25* Charter Foods 1,036 Burger King 221 Jack in the Box 42 Panera Bread Morristown, TN 65 Popeyes 81 Denny’s 3 Quaker Steak & Lube 227 Taco Bell 66 TGI Friday’s 4* Dhanani Group 19 Ampex Brands 36 Long John Silver’s Sugar Land, TX 13 Tacala Richardson, TX 26 Desert de Oro Foods Vestavia Hills, AL $1,150,000,000 $432,000,000 Kingman, AZ 516 Burger King $506,516,000 202 KFC 172 Taco Bell 294 Popeyes 317 Taco Bell 141 Pizza Hut 88 Pizza Hut 42 La Madeleine 1 KFC 39 Long John Silver’s 1 YUM! Multi 27 Franchise Management 5 Sun Holdings 20 Sizzling Platter Woodstock, NB, Canada Dallas, TX 14 Manna Murray, UT 196 KFC $994,500,000 Louisville, KY $429,442,000 107 Pizza Hut 290 Burger King $500,000,000 304 Little Caesars 161 Popeyes 157 Wendy’s 62 Wingstop 28 Palo Alto 99 Arby’s 83 Fazoli’s 27 Dunkin’ Donuts Denver, CO 27 Golden Corral 200 Taco Bell 6 MUY! Companies 32 Pizza Hut San Antonio, TX $980,852,000 $325-$425 Million 29* Hamra Enterprises 373 Pizza Hut Springfield, MO 317 Wendy’s 91 Wendy’s 80 Taco Bell 21 Boddie-Noell Enterprises 70 Panera Bread Rocky Mount, NC 7 KBP Investments 342 Hardee’s 30 Border Foods Overland Park, KS Carrols Restaurant New Hope, MN $923,600,000 22 HAZA Foods Group moved up a 201 Taco Bell 767 KFC Sugar Land, TX spot to No. 3 after 128 Taco Bell 250 Wendy’s 31 RMH Franchise Holdings it added an incred- 26 Taco Bell Atlanta, GA ible 252 restaurants 8 Summit Restaurant Group 131 Applebee’s Richardson, TX through 2019. It 23 Quality Dining $800,000,000 acquired or built 187 Mishawaka, IN 32 Cotti Foods Corp. 310 IHOP Burger Kings and 65 188 Burger King Rancho Santa 117 Applebee’s Popeyes units. It was 40 Chili’s Margarita, CA 17 Sonny’s also the sales growth 104 Wendy’s leader, adding $273 24 Diversified 84 Taco Bell 9 Covelli Enterprises million in topline Restaurant Group Warren, OH sales. Sonoma, CA 33 JAE Restaurant Group $674,200,000 214 Taco Bell Pompano Beach, FL 303 Panera Bread 16 Arby’s 207 Wendy’s 8 Dairy Queen 5 O’Charley’s 34 Franchise Times | August 2020 34 Mitra QSR 47* Premier Kings Plano, TX Montgomery, AL $175-$225 Million 179 KFC 198 Burger King 28 YUM! Multi 22 Popeyes 56* ADF Restaurant Group 35* Harman 48 TEAM Schostak Fairfield, NJ Management Corp. Family Restaurants 218 Pizza Hut WKS jumped 19 Campbell, CA Livonia, MI 15 Panera Bread spots on the list 122 KFC 65 Applebee’s 57* Cave Enterprises with a big Denny’s 153 YUM! Multi 56 Wendy’s Chicago, IL acquisition.