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How Buffalo Wild Wings’ Company-Owned Restaurants Are Crucial to Revenue

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Expansion plans

From 2011 to 2015, the overall unit count of Buffalo Wild Wings (BWLD) has increased from 817 to 1,169. This represents a growth of 43%. To have greater control over its restaurant operations and to implement its initiatives to improve guest experiences, BWLD has been focusing on company-owned restaurants for expansion. Since 2011 to 2015, the company has added 271 company-owned restaurants against 75 franchised restaurants. The addition of new units has increased the unit count of company-owned restaurants to 590, compared to 573 of franchised restaurants.

How Buffalo Wild Wings' Company-Owned Restaurants Are Crucial to Revenue

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But BWLD’s overall unit growth, which makes 0.86% of Guggenheim S&P MidCap 400 Pure Growth ETF (RFG), is slowing down, as the company is now shifting focus toward remodeling its current company-owned restaurants for its new “Stadia” design. According to the company’s management, the restaurants with the Stadia design have already achieved higher same-store sales growth than its general restaurants.

Peer comparisons

Texas Roadhouse (TXRH) and Chili’s Grill & Bar of Brinker International’s (EAT) are also focused on company-owned restaurants for expansion. From 2011 to 2015, Chili’s company-owned restaurants have grown at 15.8%, compared to -8.6% of franchised restaurants. TXRH’s company-owned restaurants grew by 26.5%, and its franchised restaurants grew by 13.9%.

During the same period, Outback Steakhouse of Bloomin’ Brands (BLMN) has reduced company-owned restaurants by 16.7% and franchised restaurants by 43.8%.

Now let’s look at BWLD’s marketing strategies.

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