> At $4.2m per store, Chick-fil-A’s average revenue is the highest of any fast-food chain in America, dwarfing both direct competitors (KFC; $1.2m) and bigger brands (McDonald’s; $2.8m)
Wow, I did not know this. Why is that?
Wow, I did not know this. Why is that?
Longer answer: McDonald's has chosen to optimize for total revenue, while Chick-fil-A has chosen to optimize for something more like ROI on each store. This is a direct consequence of the different franchise models, where McDonald's takes a cut of sales and doesn't have an ownership stake in each location, while Chick-fil-A take a cut of both sales and profits, and has ownership of the physical location.
As dave5104 mentioned, there are over 14,000 McDonald's locations in the US vs around 2,000 Chick-fil-As. McDonald's has saturated the market to the point that individual McDonald's locations cannibalize the sales of other nearby locations.
For example, there are 14 McDonald's locations within a 5-mile radius of where I live. If you closed down half of them, total revenue would probably drop some, but not anywhere near half. Many people who wanted McDonald's would just travel a little bit further to get to one. As a result, per-store revenue would go up. Per-store profit would go up by an even greater percentage since there are fixed costs per location. And if you closed the right number (which might be more or less than half), total profit would go up as well.
This would be great for franchisees, but from McDonalds' perspective it's worse since total sales would decrease, and that's what they're getting a cut of. Chick-fil-A's model, where they take a cut of both sales and profits aligns their interests more with their franchisees.
One in the vons, directly across the street from one in the ralphs, and if you head north on vermont in this street view you will hit a burger king. Today that is a freestanding starbucks. Three starbucks locations in less than a square mile.
They're so close that I've switched locations depending on the length of the line. Sometimes both are packed though.
https://www.chron.com/business/article/One-on-corner-there-a...
https://www.charlotteagenda.com/152719/chick-fil-a-woodlawn-...
Honestly though, my guess is probably consistent customer service- everyone seems to be happy- and consistently high quality food.
Also, where else would I get waffle fries?
The wendy's spicy sandwich costs more while being cafeteria food tier and is barely seasoned. BK and mcdonald's offerings aren't much better. Not sure who else is even in this spicy chicken game, but it is a massive game to get into. There is a reason why popeyes still can't keep their sandwiches from selling out instantly, and howling ray's has an hour wait on a good day. Good spicy chicken sells itself.
My intuition is their revenue is so much higher because of a mix of higher service people are willing to pay for (almost casual versus definitively fast food), higher average cost per person, and cheaper inputs (chicken versus beef price per pound).
# Speed of Service
I've ordered Chick-fil-a and literally been handed my food before the credit was done processing. That's not the norm, but was surprising. They get fast casual pricing while still being able to complete orders in a fast food
#Cost per Person
Chick-fil-a doesn't have a value menu. As a quick reference, look at the menu prices for Chick-fil-a [1] and McDonald's [2]. It's not a perfect datasource, but it roughly aligns with what I've seen.
At McDonald's you can get 2 cheeseburgers for $2. The cheapest sandwich at Chick-fil-a is listed at $3. Chick-fil-a doesn't have a "value menu" or "dollar menu" like other fast food chains do.
# Menu Simplicity
Chick-fil-a does a better job of keeping their menu simple. While it's not a direct effect on revenue, it would help training and there would probably be bigger containers of ingredients and fewer to reach over (reducing completion time).
Compare the unique ingredients between McDonald's [3] and Chick-fil-a [4]. There are way more combinations with McDonald's than Chick-fil-a. Additional complexity to be dealt with behind the scenes (though I've heard they make it dead simple to learn how to make the food). Taco Bell can (or used to be) be noted for only having about 8-10 ingredients which were mixed and matched into their entire menu!
[1] https://www.fastfoodmenuprices.com/chick-fil-a-prices/
[2] https://www.fastfoodmenuprices.com/mcdonalds-prices/
I don't think I've ever seen a bad Chick-fil-A...
And generally better for you than the major chains...
I'm not really sure what MacDonald's actually serves anymore... much less any of the others...
Is it though? I really don't get it. Chick-fil-A's entire menu consists of unremarkable chicken sandwich variations, and unremarkable... everything else. It's just not very good - at least compared to other fast food options. It doesn't stand out to me. I can't figure out why it stands out to so many other people.
I think the push-back against them from LGBTQ activists is really pretty silly. Even still, I know many bleeding hearts who are perfectly aligned with such activists and who regularly patronize Chick-fil-A (but jokingly call it "hate-chicken" or something similar) - but they keep going, and keep spending their money there. Why?!?
The food just isn't special or particularly good.
There is also something powerful about the spicy chicken sandwich in particular. Every brewpub offers some nashville styled whatever cut of chicken these days. Popeyes is still selling out their sandwiches a half year after release. Howling rays is still getting people to wait for over an hour for a chicken sandwich, and crashed the postmates website when trialed delivery for one day a few months ago.
shrug... every other chain that offers one? I guess this is all subjective, but I don't taste any quality difference between Chick-fil-A and other fast food chain chicken sandwiches. It seems like hype to me.
You go to a wendys or a mcdonalds and order a dozen nuggets, you will see they come in exactly 4 shapes—ground whatever parts of chicken pressed into a mold of one of 4 randomly chosen shapes, breaded and flash frozen at a factory, and flash fried in store. Taste is subjective of course, but the quality of meat difference here is actually pretty objective.
If I go to a CFA, I can count on the food being a certain, consistent quality. I have eaten a lot of CFA over the years, and I've had a low-quality piece of chicken (e.g. tough, full of gristle, etc.) maybe once. Compare this with "chicken" served at milkshake and burger fast food joints, which is mostly made from parts and not whole meat. I've gotten violently ill from KFC before and have since desisted from buying their food, and my local Popeyes has such bad service that no one goes - I think DoorDash is singlehandedly keeping them in business. Even Bojangles in the South or Hardee's/Carl's Jr. have given me real clunkers of sandwiches and chicken before. Chick-fil-A is consistently good quality in comparison. When I'm done with a meal at CFA, I never feel like I'm going to spend the next few hours wondering I need to begin praying to the porcelain gods.
The other killer feature is the service and efficiency. I don't hesitate to get in a long CFA line, because I know it will clear soon. This is another aspect of consistency that is just underrated. If I get in a long line at, say, McDonald's, it may clear one 5 mins or 30. With CFA, I know it'll very likely be done in 10 mins.
The third really big differentiating factor for me is that when you get something you expect to be fresh from CFA, it is consistently fresh. I have not experienced wilting lettuce, "gelling" tomatoes or carrots that have been left too long at CFA. At any other fast food joint, that is a regular experience, even the ones that are too posh to have a drive-thru. Their fresh fruit is the same thing - consistently high quality and tasty. Same goes for lemonade and iced tea (theirs really is the best in the business; and for those not from the South, you can always ask for diet or unsweetened versions of fresh drinks). My son actually gets upset at me when I accidentally get him a side of waffle fries from CFA rather than the fruit cup, since the quality is so good.
The last part is that they seem to really treat their employees well. CFA tends to start their employees at higher wages than almost any other fast food chain, and they give them extensive training in how to operate the store and treat customers. I've heard employees - both Christian and not - say that having a guaranteed day off once a week is wonderful. The restaurants are clean and the workers seem to take pride in doing good work. It's just a good atmosphere. It seems like the kind of job that gives low-skill people the actual skills they need to be productive citizens and employees when they're looking for something beyond food service.
If I were to put it all in statistical terms, along almost any measure dimension, CFA has an above-average mean and extremely low variance. Other fast food places have optimized certain dimensions like this as well: McDonald's for example has extremely consistent - and mediocre - quality and a very consistent low price point. None of them match the breadth of consistency as well as CFA does.
The spices on the chicken taste weird to me...
In other words, the "per store" metric isn't as impressive when you look at the number of stores.
Most organizations lose 30% - 50% of their "mojo" with each layer of separation from an "engaged stakeholder". Generally meaning someone with equity or substantial profit sharing.
I'd also bet that the majority of their owners only own one business, which means they are even more engaged.
Compare that with the typical master franchise operator, who may be running multiple locations and multiple brands. Unless they have an awesome process and technology team, their operational efficiency is probably a full order of magnitude below the typical highly engaged Chick-fil-A...
It is literally the default choice for soccer moms ferrying kids among afternoon activities.
It’s sort of like how folks won’t eat pork.
Dietary science really was awful, and probably still is comparatively weak. I think it's getting better though; I'm pretty convinced that sugars are bad.
Have you seen the video of the McDonalds worker assaulting a customer because they complained about cold food. They are the worst.
I also think the size of their chicken sandwich is the key. Not press-meat but a true 6 ounce breast filet. The other fast food stores use junky meats.
During the busy periods they put order takers outside in line to take orders.
They have so serious efficiencies. I like that.
During the busy periods they put order takers outside in line to take orders."
In-N-Out was doing those a decade ago, easily. It was my first memory of eating at one, the line spilled out to the highway exit ramp, and they had people there outside running down the lanes and the street to take orders.
Maybe not even junk "meats" at all.
"Those results were averaged: the oven roasted chicken scored 53.6 per cent chicken DNA, and the chicken strips were found to have just 42.8 per cent chicken DNA. The majority of the remaining DNA? Soy."
https://www.cbc.ca/news/business/marketplace-chicken-fast-fo...
Fewer stores targeting higher revenue areas, often where they are exclusive local operator. It's like Mac vs PC. You can get higher revenue per store if you limit your market size.