Dive Brief:

• Wienerschnitzel has launched a limited-time franchise incentive program called “Hot Dogs for Profits” to attract qualified franchisees as the company expands throughout the U.S., the company announced Tuesday.  
• The program offers reduced royalties, marketing funding provided by parent company Galardi Group and the inclusion of a $5,000 owner/general manager training fee. The discounts depend on specific store commitments.
• The hot dog chain’s 2023 expansion goals include further growth in the Midwest and select Southern states.

Dive Insight:

Wienerschnitzel, which has posted 12 years of consecutive same-store sales growth, has about 350 franchised locations open in 10 states and over 50 units in development, according to the press release. In 2022, the hot dog chain signed multi-unit franchisee agreements in new markets. Restaurants are expected to open in Arkansas; Boise, Idaho; Omaha, Nebraska; and the Rio Grande Valley in Texas this year. 

“With simple operations, low food costs and a unique menu that doesn’t compete in the burger, chicken, tacos or pizza segments, Wienerschnitzel has proven to be a profitable franchise investment that continues to lead the industry in helping entrepreneurs open successful restaurants,” Ted Milburn, director of franchise development for Wienerschnitzel, said in the press release. 

As part of Hot Dogs for Profits, operators who agree to open three stores will receive a $64,000 development and franchisee fee and reduced royalties that begin at 1% for the first year and then increase by 1% each subsequent year until the fifth year, beyond which the royalty rate will remain at 5%. In addition to the included training fees, operators will also receive $20,000 in local marketing spend from Galardi Group for the first store. Single-unit commitments will include discounted royalties for the first two years and marketing spend from Galardi Group.

Wienerschnitzel has not yet determined when the Hot Dogs for Profits program will end.

States available for expansion include Minnesota, Wisconsin, Iowa, Illinois, Missouri, Nebraska, Kansas, Oklahoma, Mississippi and Oregon, according to the company’s website. Existing states available for ongoing growth include Washington, Idaho, California, Nevada, Utah, Colorado, Arizona, New Mexico and Texas. The chain offers various store formats including new construction, conversions and end caps, and its real estate team helps with site selection, build out and construction and signing leases.

Many other restaurant chains with aggressive expansion plans have offered incentive programs to lower the cost of entry for operators. Nathan’s Famous is providing half off of franchise fees for operators willing to convert their restaurants into a Nathan’s. Wings & Rings extended its franchise incentive program through 2023 to offer a 0% royalty rate for the first six months. Jack in the Box is also offering a discounted royalty rate for the first five years of franchise agreements with new operators who commit to opening at least three stores.