Saladworks
Franchised Units: 104
Franchise Fee: $30,000–$35,000
Total Start-Up Costs: $356,350–$649,200
Royalty: 5%
Renewal Fee: $17,500 at 10-year term
Marketing Fee: 3%
While early detractors questioned the viability of a salad-dominated brand, Saladworks’ customers have voted with their wallets. Saladworks created a following for its hip, modern atmosphere as well as its menu, which also includes soups and sandwiches. In 2008, the Pennsylvania company earned more than $64 million in U.S. sales while AUV neared $1 million.
Plans call for the establishment of more than 1,000 outlets across the country in the next decade. Saladworks’ vice president of business development, Jena Feret, says franchisees receive in-depth training, covering everything from management and marketing to food preparation. Other development tools include lease negotiation services, low-cost vendors, and ongoing operational support.
“Saladworks is so confident in our systems and processes that the concept is offering guaranteed financing to qualified individuals,” Feret says.
Word on the Street: “Saladworks is on the trend for healthier food and they are going green, which customers resonate with,” Tran says. “Only problem is that they may niche themselves out. Even if they roll out a bunch of brand-new products, they will always be seen as a salad concept.”
Domino’s Pizza
Franchised Units: 5,047 U.S. locations*
Franchise Fee: $25,000
Total Start-Up Costs: $119,950–$461,700
Royalty: 5.5%
Renewal Fee: $1,500
Marketing Fee: 5.5%
Bolstered by name recognition, a proven business model that bests $3 billion in sales, an evolving product mix (toasted subs have lured lunch diners), and a value-added supply chain, Domino’s franchisees report a healthy mix of franchisor support and consumer response.
Indeed, the Ann Arbor, Michigan–based company takes care of its own, offering significant discounts for successful operators to open subsequent locations, including a $5,000 fee to build a new store and a slim $1,500 fee to purchase an existing store.
“Domino’s Pizza offers some of the lowest franchise fees in the industry and makes franchising and business ownership accessible to qualified team members,” Domino’s Pizza executive vice president of franchise operations Scott Hinshaw says.
Word on the Street: “Domino’s has a powerful reputation for speed of delivery,” Allen says. “This is the core essence of their brand. The more they move away from it, the weaker they become against competitors like Pizza Hut (winning with product innovations) and Papa John’s (winning with a focus on the perception of quality).”
*based on 2008 figures estimated by QSR or Technomic Inc.
