Dive Brief:

• Hawaiian Bros, a roughly 30-unit fast casual chain, signed its first multi-unit franchise agreement for 75 restaurants with Stine Enterprises, the chain announced Tuesday.
• Stine, which owns and operates 87 Jack in the Box restaurants and 14 Denny’s restaurants in California and Arizona, will develop Hawaiian Bros in Arizona and North Texas. The first of these units will open later this year, Hawaiian Bros wrote in an email to Restaurant Dive. 
• Hawaiian Bros owns and operates its stores in six states, and will transfer ownership of 11 units in Dallas-Fort Worth as part of the Stine deal.

Dive Insight:

Hawaiian Bros began expanding its franchise opportunities in select states late last year and is in talks with multi-unit operators that have more than 10 years of experience and can help the company grow quickly.

Stine agreed to open the 75 Hawaiian Bros units by 2032, Hawaiian Bros said. The company was founded in 1982 by Steve Stine, who was one of the first Jack in the Box franchisees. Over 40 years and alongside his son and partner Adam Stine, Stine built a portfolio through new development and acquisitions of franchised or corporate-owned restaurants. 

“The opportunity to operate a unique, high-AUV fast casual restaurant concept with a simple menu that delivers efficiencies with supply chain and a 30-second speed of service standard at the drive-thru windows was attractive to us," said Adam Stine, president and chief operating officer of Stine Enterprises.

The chain boasts a $4 million average unit volume according to its website. Its stores include drive-thrus, while new builds and conversions typically take up 3,000 to 5,767 square feet. About 50% of sales come from the drive-thru at units that feature the channel, while off-premise makes up about 80% of the company’s business. To meet its goal of 30-second drive-thru times, Hawaiian Bros has staff outdoors to take orders and previously retooled its kitchen to set up a dedicated makeline for drive-thru orders. The chain serves plate lunches with a choice of protein alongside macaroni salad, white rice or vegetables and Dole Soft Serve.

Hawaiian Bros isn’t the only mid-market company to sign large multi-unit deals in the past year. Established chains have been focusing on multi-unit operators who understand how to operate in current economic conditions. Modern Market, which has about 30 units, secured a 41-unit deal last year with its first franchisee, Thrive Restaurant Group, to develop in 11 new markets. Crisp & Green signed its largest franchise deal in its history earlier this year with Salads & Smoothies to develop 40 units in addition to an existing 11-unit deal.