Dive Brief:
- Bojangles Opco and franchisee Jeff Rigsby of BOJ of WNC have agreed to a development deal to open 45 new locations over the next seven years, according to a press release. Bojangles currently has over 760 restaurants in the Southeast.
- The restaurants will be developed in Rigsby's existing markets of Georgia, Kentucky, North Carolina, South Carolina and Tennessee and a new market of Columbus, Ohio, where 15 locations are expected. Rigsby, who operates 92 locations, also acquired 16 company-owned locations, making him the largest franchisee in the chain’s system.
- This deal marks the first major franchisee expansion since Bojangles partnered with Love's Travel Shops & Country Stores in December 2019 to open 40 new locations across four states.
Dive Insight:
This development deal marks a new phase for the QSR, which closed some underperforming stores and planned to refranchise over two dozen following poor sales during Q3 2018. The company went private in a $594 million deal at the end of 2018. Growth became a changing focus in 2019 when it hired its first chief development officer Jose R. Costa, who has been in charge of expanding unit counts and recruiting new franchisees. Pre-pandemic, Bojangles sales also were showing signs of improvement, growing 2.7% to $1.3 billion in 2019, according to Technomic data.
The pandemic slowed expansion across the QSR segment as many franchisees faced financial challenges due to declining traffic and sales early in the pandemic. But concepts like Bojangles that had to close their dining rooms still had drive-thrus and off-premise channels to fall back on, which helped drive sales throughout last year.
As vaccines start to roll out, franchisees appear to be more willing to sign deals and open additional locations. Rigsby already plans to open nine Bojangles locations this year and is projected to have 100 stores in operation by 2022. Papa John's signed its largest North America franchisee deal in over two decades with HB Restaurant Group last year to open nearly 50 locations by 2028. Hooters' fast casual concept Hoots Wings signed its first franchisee, AE Restaurant Group, to a 60-unit deal to open eight to 10 units each year starting in 2020. Noodles & Company is planning to expand via multi-unit franchisee partners to grow in Alabama, Florida, Georgia, New Mexico, South Carolina and Texas.
Disclosure: Falfurrias, the majority owner of Restaurant Dive's publisher, Industry Dive, was previously invested in Bojangles'. Falfurrias has no influence over Restaurant Dive's coverage.
