SONIC Drive-In
Click
here to link to Sonic’s detailed company profile
For more than 50 years SONIC has built a dominant position in the drive-in restaurant business and today has over 3,500 drive-ins. SONIC prides itself in sticking to what made drive-ins so popular in the first place: made-to-order American classics, signature menu items, and speedy service from friendly Carhops. SONIC’s ever-growing menu is full of options to satisfy every taste, with frequent additions such as real Fruit Smoothies. Most of SONIC’s new menu creations are pioneered by entrepreneurial franchisees, as was the case with the highly successful Frozen Favorites dessert menu expansion in 1996.
Today, SONIC is the largest chain of drive-in restaurants in America. As a business it continues to thrive, maintaining strong sales growth, industry-leading customer frequency and high returns for stockholders. SONIC franchisees enjoy one of the most successful businesses with average unit sales increasing each year since 1987 and one of the lowest turnover ratios in the quick-service restaurant franchise industry, with unparalleled opportunities for personal success.
| |
Operating Units |
12/31/2008 |
12/31/2009 |
12/31/2010 |
|---|
| | Franchised |
2,791 |
3,069 |
3,117 |
| | % Change | -- |
10.0% |
1.6% |
| | Company-Owned |
684 |
475 |
455 |
| | % Change | -- |
-30.6% |
-4.2% |
| | Total |
3,475 |
3,544 |
3,572 |
| | % Change | -- |
2.0% |
0.8% |
| | Franchised as % of Total |
80.3% |
86.6% |
87.3% |
Investment Required
The initial investment fee for a SONIC franchise is $45,000. SONIC also offers a Development Agreement program.
SONIC provides the following range of investments required to open your initial franchise. The range assumes that all items are paid for in cash. To the extent that you choose to finance any of these expense items, your front-end investment could be substantially reduced.
| |
Item | Established Low Range | Established High Range |
| |
Initial Franchise Fee |
$45,000 |
$45,000 |
| |
Payroll |
$72,600 |
$97,900 |
| |
Expenses While Training |
$57,000 |
$106,000 |
| |
Advertising Funds |
$7,500 |
$24,000 |
| |
Beginning Inventory |
$32,600 |
$103,000 |
| |
Prepaid Expenses Including Security and Utility Deposits, and Business License |
$10,000 |
$12,000 |
| |
Insurance Premiums |
$8,000 |
$35,000 |
| |
Land |
$75,000 |
$1,200,000 |
| |
Building and Site Work |
$555,000 |
$998,000 |
| |
Equipment |
$140,000 |
$210,000 |
| |
POS System |
$58,600 |
$103,800 |
| |
SONIC Sign |
$9,000 |
$46,000 |
| |
LED Electronic Message Center |
$25,000 |
$38,000 |
| |
Additional Funds (3 Months) |
$7,000 |
$28,000 |
| |
Total Initial Investment |
$1,102,300 |
$3,046,700 |
Ongoing Expenses
SONIC franchise owners pay a monthly royalty fee equal to 5% of gross sales and a monthly advertising cooperative fee of 3.25% of gross sales. Additional fees include a monthly brand fee of 0.9% of gross sales.
What You Get—Training and Support
SONIC provides an 11-week training program that consists of eight weeks of restaurant training, three weeks at new store openings and one week of classroom training. Classroom instruction covers leadership development, restaurant management skills, food safety and overall business development. SONIC also has real estate professionals who help evaluate a new site and review the demographic and population mix, as well as provide architectural, construction and engineering assistance.
SONIC has a national purchasing program to help franchisees maximize economy, efficiency and profitability, as well as a research and development team working to create products customers want. Marketing assistance is provided in the form of regional and national cable advertising as well as materials such as radio and TV commercials, newspaper ads, direct mail, coupon books, promotional posters and signage that can be customized for each franchise. Furthermore, SONIC provides ongoing support from experienced operations and marketing professionals.
Territory
SONIC grants exclusive territories.
Note: The tables and information regarding the number of operating units, investment required, on-going expenses, training and territory grants were taken from the company’s 2011 FDD. The 2011 write-ups will be incorporated into the 2012 Edition of Bond’s Top 100 Franchises publication.
|
