Chic-Fil-A Business Plan

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“The fast food industry, also known as Quick Service Restaurants (QSR), has been serving up tasty morsels for over 80 years (Franchise Help, n.d.).” As time passed, the industry has come up with new ways to keep people coming back. An example of this is, as cars became more and more a commonplace, the industry thought of the concept of providing drive-thru services. This concept became an instant success because customers loved the idea of food-on-the-go.

Today fast food restaurants are all around the world in over 100 countries. The United States alone has well over 200,000 restaurant locations. Last year alone the fast food industry generated over $160 billion in revenue and continued to grow at an astonishing 8.6 percent annually. “The industry has been built on high volume, low-cost, and high-speed product (Franchise Help, n.d.).”

In recent years, the fast food restaurants have been pressuring profit margins. The industry as a whole has been able to persevere through these challenges. In the past decade, the industry has put more focus on the nutritional quality of food they serve. This has been to meet demands of adopting healthier food choices. This counteracted the bad press they were receiving for the health consequences of fast food. Another problem the fast food industry faces rising commodity prices. “The higher prices for livestock, chicken, corn, and wheat have shrunk margins over the past decade (Franchise Help n.d.).” The competition is so fierce; they did not want to pass the cost along to their customers, so their profit margin shrunk 10 percent. Market saturation is another relevant is that fast food restaurants are facing. (Popeyes, KFC, McDonalds, Burger King, etc.) With a wide variety of competitors that offer similar products, there is a fewer customer at each location.

In today’s society there will always be a need for quick meal options, and as they continue to face challenges, they are constantly reinventing themselves to stay on top of the fast food industry. They are changing their menu selection by offering new healthier choices like salads and low-calorie wraps so that customers have options to a healthier meal. “Many franchises has been exploring other meal times such as breakfast and afternoon snack for growth opportunities and to increase real estate utilization (Franchise Help, n.d.).”

Fast food is a large, diverse industry with plenty of opportunities. They face their challenges with innovation by offering new menus, pricing, and strategies to keep customers coming back. As the industry continues to change and the economy strengthens, the fast foods bottom line will continue to grow.

There is a prime location at 1234 Sells Lane North Huntingdon, PA. The restaurant has 1,300 square feet of space and is located in the heart of a large shopping center. The shopping plaza consists of several large department stores and a couple of banks. It is located in the heart of the shopping plaza and is located near a middle-class residence. This is in an ideal location as we are likely to attract community members who come from shopping and the employees who work in the surrounding stores that are on their lunch hour.

The management team will consist of a general manager, assistant manager, and shift managers. The general manager’s salary will start out at $46,000. The requirements for general managers are as followed: a college degree (preferably in business management), 2 or more years of food service management, knowledge of management software, payroll, finances, and business recordings. They will also need knowledge of food safety, equipment safety, and sanitation regulations. A general manager’s responsibilities are as followed: oversees general restaurant operations, oversees P&L statement, managing both the front end and the back end of the house. Other responsibilities include hiring and managing staff, a working on marketing initiatives.

The assistant managers will receive an hourly wage of around $13.00/hour. The requirements for an assistant manager are as followed: postsecondary training in restaurant management, a thorough understanding of food safety and sanitation, and previous experience in restaurant management. The assistant manager’s responsibilities are as followed: helping the general manager oversee day-to-day operations, must be ready to fill other management positions (including general manager) if they should be absent, the ability to cook, inventory, and customer service.

The shift managers will receive an hourly wage of around $9.00/hour. The requirements for a shift manager are as followed: knowledge of all employee roles in a given shift, basic accounting and math skills, experience in food service, team-leading skills, and excellent communication skills. A shift manager responsibilities are as followed: oversees restaurant operations during certain shifts, responsible for monitoring cash handling, and direct kitchen workers and order takers.

Each level manager has their role in the restaurant. To ensure fast, efficient services everyone must do their part. They compliment each other because each manager is knowledge and skilled in their position and they all bring it together to ensure the success of a company.

The initial investment to open a Chic-Fil-A franchise can cost anywhere from $130,975 to $1,044,200.

Name Of Fee

Estimated Cost

Initial Franchise Fee

$10,000.00

Opening Inventory

$42,000.00

1st 3 Month’s Rental of Equipment

$3,000.00

1st 3 Month’s Lease/Sublease of Premises

$30,000.00

1st 3 Month’s Insurance Expense

$3000.00

Additional Funds (1st 3 Months of Operation)

$460,000.00

Total Estimate of Initial Investment

$548,000.00

There are other Fees to take into consideration when you open a new business. These fees Include but are not limited to: Business Service Fee ($300), Hardware and Support; High-Speed Internet Access ($1,000 to $4,000) annually, Cash Handling System Services ($150 to $450) monthly and Reimbursement of Cost of Performance (will vary),