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January 2007 |
Volume 8, Issue 1, Part 2 |
 McDonald's may be putting its Boston Market restaurant chain up for sale, continuing its back-to-basics focus on hamburgers that has helped the company improve sales and stock performances in recent years. Boston Market employees were told this month during an annual state-of-the-company meeting with executives that McDonald's planned to sell the fast-casual purveyor. Oak-Brook, IL-based McDonald's revealed in a recent statement that it was evaluating Boston Market this year. The burger giant originally acquired Boston Market for $173.5 million in a bankruptcy auction nearly seven years ago as part of a move to diversify.
The company's priority continues to be the McDonald's brand. Since the revitalization began, the chain has successfully shifted its organizational resources toward a "Plan to Win", driving strong, continued business results for more than three years. Since McDonald's acquired Boston Market it has slimmed the chain down to about 630 restaurants in 28 states. The fast-feeder launched partnerships with a number of grocery chains to supply Boston Market-branded meals to their deli departments. Boston Chicken began in Newton, Mass., in 1985, and its development helped give birth to a new category of eat in/takeout restaurants called "home meal replacement." (ChicagoTribune.com, 1/12/2007)
Ex-Burger King CEO Appointed to Head Quizno's
 Former Burger King Chief Executive Greg Brenneman has been named president and CEO of Quizno's and Brenneman's equity firm has taken a position in the privately held sandwich chain. Quizno's also announced that Rick Schaden, previously chairman and CEO, will now serve as chairman. Brenneman left Burger King in April, 20 months after taking the job and less than two months before its IPO. Quizno's believes that he will bring the right mix of experience, strategic foresight and drive to take the Quizno's brand to the next level of growth and profitability. Brenneman would like Quizno's primary mission to be increased restaurant profitability for franchise owners while building brand awareness, expanding the customer base and focusing on international and U.S. growth. The sandwich chain currently has more than 5,000 franchised restaurants. (SignonSanDiego.com, 1/8/2007)
Chili's Restaurants Sold
Restaurant company Brinker International Inc. is selling 89 of its company-owned Chili's Grill & Bar restaurants to Pepper Dining Inc., an affiliate of Olympus Partners, a private equity firm in Stamford, Conn. Under the deal, Pepper Dining has also agreed to develop 20 to 44 new Chili's locations in the Southeast and Northeast, including Massachusetts, Rhode Island, South Carolina, North Carolina, Georgia and others. The deal is Dallas-based Brinker's largest franchise transaction to date. It is part of the company's plan to expand franchise ownership of its brands from 20 percent to about 30 percent over the next year.
Including the Pepper Dining Deal, Brinker (NYSE:EAT) franchisees have bought 125 company-owned restaurants and signed development commitments for more than 200 locations over the next 10 years. Brinker's other restaurant concepts include Romano's Macaroni Grill, Maggiano's Little Italy and On The Border Mexican Grill & Cantina. (Dallas Business Journal, 1/5/2007)
 Major hotel brands, expecting another year of rising profits in the United States, have set their sights on Asia as the next big market for the lodging industry. For example, Intercontinental Hotel Groups, the world's largest hotelier which also operates Holiday Inn and Crowne Plaza hotels, is investing in their brands and diversifying geographically with a concentration in east Asia. Intercontinental already is the top hotel company in China as well as Japan where last year it acquired a majority stake in All Nippon Airways Co.'s hotel management unit.
Hilton Hotels, which earlier this year acquired its British namesake and international rights to the Hilton name, also has big plans for Asia, including India and China. Executives at Hilton believe that investing in India, with its "long history of English law," is more straightforward than China, which requires more caution. (USA Today, 1/24/2007)
Two Franchisees Buy Buffalo's Wings Chain
 Buffalo's Franchise Concepts, the Atlanta-based operator of wings favorite Buffalo's Southwest Cafe, was sold this month to two franchisees for an undisclosed sum. Drew Alexander and Shelli Lang, who own Buffalo's locations in Las Vegas and Mesquite, Nev., bought the company from Buffalo's founder Ralph Perella, who will continue with Buffalo's as a consultant.
Buffalo’s, founded in 1985, has 38 restaurants in 10 states, Puerto Rico and Kuwait. Thirty-four of the stores are franchised while four are company-owned. The chain had sales of $47 million in 2006 and $46 million in 2005. It recently launched a new Buffalo’s Express concept, which was also sold in the deal. Before entering the food service industry, Alexander and Lang were franchisees of Hair Club for Men. They hold a franchise development agreement for seven Buffalo’s locations.
(AJC.com, 1/18/2007)
 Choice Hotels International has reported that, as of Dec. 31, it had signed franchise agreements for a total of 43 new Cambria Suites hotels, its two-year old all-suite hotel brand. Choice added that during the fourth quarter alone it approved agreements for 10 Cambria Suites to be built in Atlanta; Augusta and Savannah, Ga., Beachwood (Cleveland), Ohio; Houston; Oklahoma City; Orlando; Pensacola, Fla; Plainfield (Indianapolis), Ind; and West Madison, Wis.
Developers are executing agreements to build Cambria Suites hotels across a wide range of locations, including mixed-use developments, urban and surburban areas and airport locations. Choice launched the upscale Cambria Suites brand in January 2005 with features that include suites that are 25% larger than standard hotel rooms.
(Travelweekly.com, 1/24/2007)
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