Led by an affable "CEO" with a Ping-Pong ball for a head, Jack in the Box is among the leading quick-service restaurant businesses in the US. The company operates and franchises more than 2,200 of its flagship hamburger outlets in California, Texas, and about 15 other states. Jack in the Box offers such standard fast-food fare as burgers, fries, and soft drinks, as well as salads, tacos, and breakfast items. About 625 locations are company-owned, while the rest are franchised. In addition to its mainstay burger business, the company runs a chain of more than 575 Qdoba Mexican Grill fast-casual eateries through its Qdoba Restaurant subsidiary.
Unlike some of its fast-food rivals, Jack in the Box has traditionally had a large number of corporate locations compared to its franchised outlets. However, looking to reduce costs and increase revenues during 2010 and 2011, the company sold many of its corporate-run eateries to franchisees. It refranchised more than 300 Jack in the Box locations during fiscal 2011.
Jack in the Box hopes to refranchise up to 200 more locations during 2012 and 2013, eventually bringing its franchise ownership rate closer to 80%. The company's franchise ownership percentage was 57% in fiscal 2010 and 72% for fiscal 2011. In addition to royalties and other franchising fees, the company also supplies many of its franchisees with equipment and other goods. Its foodservice distribution operation accounts for almost 25% of sales.
Jack in the Box leans on quirky marketing efforts and an almost constant stream of new menu items to help compete with such larger rivals as McDonald's and Burger King. Its advertising campaign featuring the company's fictional CEO, Jack, strikes a balance somewhere between the family-friendly image of the Golden Arches and the marketing efforts of Burger King, which skews more towards the young male demographic.
Meanwhile, Jack in the Box has also been working to upgrade many of its outlets with modern interior designs, complete with flat-screen televisions and ceramic tile floors.
Looking to gobble up more market share in the still-growing quick-casual dining segment, the company's Qdoba chain added about 50 locations (mostly franchised stores) during 2011. The concept, acquired in 2003, is the #2 fast-casual Mexican chain behind Chipotle Mexican Grill. – less