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10 QSR Brands that Have the Greatest Number of Richest Franchise Owners
LEXINGTON, Ky. (Blue MauMau) - A survey provided to Blue MauMau by food industry analyst Technomic shows the largest quick service restaurant brands by revenue have developed much more than their fair share of the wealthiest franchise owners.
Out of 400 of the largest franchise owners, how rich are these franchisees?
Very.
The largest franchise owner, NPC International, Inc., owns some 816 Pizza Huts. Their franchise recorded revenues in 2007 of $602 million. The tenth largest among the list of the top 400 restaurant franchisees had revenues approaching $300 million.
The franchising firm that can claim that it births more of the richest franchisees than anyone else is Louisville-based Yum Brands. Some 150 of the country's top 400 franchise owners by revenue are from Yum. That is over one in three of the country's biggest franchise owners. Not a few franchisors would like to know what is in that secret formula that is growing such large franchisees.
Private equity firm Triarc can boast systems that nurture the second largest batch of the super rich with its double brands of Wendy's and Arby's.
The slide show below presents the top 10.
Revenue Is Not Wealth
Same on you BMM for the misleading title. All you are talking about is revenue (which is the figure you could get). And it's total revenue per Zee, so Zors that allow very big area franchising Zees get a skew.
Who is more "rich", a Zee that has $100,000,000 revenue from their 100 units, or the Zee that has $80,000,000 revenue from their 20 units? (As if you could tell be revnue anyway.)
Revenue and Possessions Is Wealth
That's easy to answer. The guy with the $100 million in revenue and 100 units. $100 > $80. A guest has already posted the dictionary definition of rich and wealthy, which are used in the definition as synonyms.
The key to being rich and wealthy is having possessions (assets).
my friend, gross is not net
Wealth is what you have not what passes through. You can't tell a damn thing from just revenue, if your revenue is $100M but your expenses are $102M, would you really think you are more "wealthy" than someonw whose revenue was $80M but whose expenses were only $70M? You sound like an academic type, a pedant debating definitions!
Wealth and Riches
Profound words from Mr. Bean. The problem with all my material possessions is that it all eventually passes through. Some assets pass through more quickly than others.
I just want $10 trillion dollars for 30 days before I have to hand it back. That's my dream.
At any rate, I'd love to see a list of the largest private companies ranked by owner's equity, net profits or investment yield. I've never ever been able to read something like that. Please post it when you find it.
Mr. Bean's Got My Number
You got my number of an academic pedant who debates definitions - whatever "pedant " means.
With all due respect, one can tell something from the amount of income (revenue) received or how many Pizza Huts one has.
Mr. Warren Buffet is the richest billionaire on the planet because of his assets, no matter what his expenses. I understand that Mr. Buffet's financial managers may prefer to stretch the definition of richness by emphasizing the yield on his investments. If he receives enough losses on asset investment, one day he may not be a rich billionaire.
It was written: With all due
It was written:
With all due respect, one can tell something from the amount of income (revenue) received or how many Pizza Huts one has.
My reply:
Not really. One of my clients has between 50-100 units of major league franchise units. In the aggregate he makes next to nothing on them. Any wealth he derives is ancillary to the franchise units he operates. However they do serve a useful purpose as "props" that allow him to exert a certain amount of leverage politically and socially, thus allowing him to participate and profit in other endeavors. In essence as long as they operate around break-even he has no reason to liquidate them.
My point is, you may find that some large operators have motives not related to profit for being franchisees.
FuwaFuwaUsagi
Being Rich, With All Due Respect
Agreed.
Fuwa makes my point well. I know that financial consultants here want to know cash flow and profit margins, returns and trends to judge the health of a company. And if a company isn't healthy then in their minds being wealthy or rich is useless. Frankly, I welcome any sort of ground-breaking chart the financial analysts can come up with to compare cash flows, net worth or return on assets of private companies.
But as Fuwa points out, possessions (being rich) has its own power, even in troubled years.
Rich
"Some people get so rich they lose all respect for humanity. That's how rich I want to be." - Rita Rudner
Quiznos Is On A Different List - The Franchisee SH
#T list. Quiznos is where Franchisees go to go broke.
Brenneman's Report card at Quiznos
O.K. you experts who said we have not given Brenneman time to turn this ship around. What do you think now? Eighteen months later and we are in worse shape than before. The goal of simplified operations is a joke. Food costs which were labeled as ridiculously too high are higher. The goal of increased profit of ten grand for each location is a joke as well.
Greg didn't come close to proving to anyone that he was a turn-around expert here at the old Q. It goes without saying that you put a good man in a bad situation and you get bad results. The problem now is we have an unknown with Deno and that scares the living hell out of me.
Millionaire Richard Quick is not on the list
I'm surprised that Millionaire Richard Quick is not on the list.
Oh that's right, this is a list of franchisees, you actually have to be willing to work hard to get on this list.
No veranda sitters on this list.
Richest Zees
Given the surface article comments, this is talking revenue and amount of franchising, by chain. That does not equate to richness. Perhaps bad title.
Naturally, larger multi-unit zees (like NPC) will have advantages. Problem is how to get there, how to get access to capital, sites, management systems, and good people.
John A. Gordon
www.pacificmanagementconsultinggroup.com
Advantages of the Rich
Good point. $600 million in top-line revenue riches will have advantages that the poorer $200 million franchisees will not have. I'd like to know the answer to your question:
Uh, okay. Some questions,
Uh, okay.
Some questions, what does rich mean? How is rich determined? If I have a bunch of units does that mean I am rich? I have a client with over 100 units of the large box QSRs - is he then rich? I also notice the term wealth is used, which has a specific context in financial terms. I am not being sarcastic I just do not understand the vernacular nor the context.
FuwaFuwaUsagi
Questions
Have to agree with Fuwa.
Don't really understand the underlying measures.
But, very nice chart, Don. I am being serious - who knew about the level of concentrations of 'ee ownership?
Guess that these fellas don't litigate or arbitrate their differences - be fascinating to know or sit in on some negotiations between the franchisor and the 25% owner of franchise units.
Michael Webster PhD LLB
Franchise News
Being Rich
I disagree. Here's how the dictionary defines "rich":
rich [ritʃ] adjective - wealthy; having a lot of money, possessions etc
Our politicians define the rich to be targeted for higher tax as households with incomes higher than $200,000 (not their net income). Donald Trump is a rich billionaire, not because his net profits in any given year are a billion. In some years, he actually had a net income loss but had oodles of units. (Some of those he had to sell at a time where he received less than he would have during good times.) Trump was and is still considered a rich billionaire.
If anything, this article is too conservative in just using annual revenues to judge richness.
World's Richest Measured by Assets
If Bill Marriott decides to take a cut in his salary during a lean year to $1, is he still rich?
Here's how Forbes ranks their annual list of "richest men in the world".
Surprise, surprise. Few of the rich will disclose their net worth or their net profits.
Contrasting Pizza Hut Franchisees
Interesting that BMM has a story showing that the franchisee with the highest revenues in the industry, NPC International, Inc., is with Pizza Hut, and yet there was news of a large Pizza Hut franchisee Chapter 11 bankruptcy protection filing less than two weeks ago.
This is not a comparison of apples, though, because the stats on NPC are for 2007, while Midland Food Services, the Chapter 11 company, is experiencing the tougher times of 2008. The size differential is great: NPC had 816 locations in 2007, but Midland has “dozens.” Dozens is impressive, but not in the same league as 816.
See the Midland Pizza Hut story here.