Buffalo Wild Wings Outpaced Others in Unit Growth



Unit growth

After discussing same-store sales growth, let’s look now at another revenue driver: unit growth. All casual dining restaurants are primarily company-owned. So we have to be careful when comparing unit growth since opening new company-owned restaurants requires more capital expenditure. The median unit growth for casual dining restaurants in 4Q15 was 3.4%.

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The leaders

Of all the casual dining restaurants we’re covering in this series, Buffalo Wild Wings (BWLD) had the highest unit growth in 4Q15 with the addition of 93 restaurants. That represents a unit growth of 8.6%. In the last 12 months, BLWD has added 105 company-owned restaurants and closed 12 franchised restaurants.

BWLD was followed by Texas Roadhouse (TXRH) with a 7.1% unit growth. It added 29 company-owned restaurants and three franchised restaurants. TXRH forms 0.16% of the holdings of the iShares Russell 2000 ETF (IWM). The Cheesecake Factory’s (CAKE) unit growth was 5.8% with the addition of 11 restaurants, to take its total unit count to 200.

The laggards

In 4Q15, Bloomin’ Brands (BLMN) posted the least unit growth of -0.1%. The company sold its Roy’s concept, which operated 20 units in January 2016. After leaving Roy, the company expanded its units from 1,488 to 1,507, an increase of 1.3%.

Other companies that posted lower unit growth were Brinker International (EAT) and Darden Restaurants (DRI) with 0.7% and 0.9% unit growth, respectively.

In our next article, we’ll see how well these restaurants are utilizing their resources and revenue per square foot.


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