The expansion, which will significantly increase the number of both franchised and company-owned restaurants, will also result in approximately two-thirds of the company's restaurants being operated by franchisees, up from approximately one-third today.
Captain D's decision to expand is fueled in part by the company's success over the past few years. It has posted record sales increases in seven out of last eight years, and two Captain D's locations now boast more than $2 million in annual sales, a company milestone.
The company is also buoyed by consumer acceptance of a new restaurant prototype it introduced in mid-1999, which recreates the allure of a wharf-side seafood shack. Same-store sales at remodeled units increased as much as 30 percent last year, well above the company's average same-store sales increase. All new franchise and company-owned Captain D's restaurants will be built to the new specifications.
In addition, the Nashville, Tenn.-based company hopes to take advantage of growing interest in "fast-casual'' dining options: Concepts that provide consumers with a more relaxed, "stay awhile'' atmosphere, while still satisfying their desire for fresh food prepared quickly. Captain D's was among the first restaurant companies to embrace this approach.
"Captain D's offers consumers a unique dining experience and a welcome diversion from typical quick-serve and casual-dining fare,'' says Ronald E. Walker, president and COO of Captain D's. "By giving both consumers and investors the value they want, we're well-positioned for continued sales and unit growth.''
Walker adds that the strong financial performance of Captain D's new restaurant prototype, along with modest competition and high barriers to entry in the seafood category, enhance the concept's appeal to the multi-unit foodservice, convenience store and retail operators the company is seeking to spur its franchise growth.
"Based on the research we've seen, our new restaurant prototype is competitive with the best-performing restaurant franchises, which has increased the level of interest from multi-unit operators and investors looking for innovative concepts and new avenues for growth,'' Walker says. "They're realizing that it just doesn't make sense to compete in crowded restaurant categories, especially when many leading brands are already over-developed.''
Captain D's will continue to expand in the Midwest and Southeast, where the company already enjoys 90 percent brand recognition, as well as explore opportunities in other markets. Both new and existing markets for the company will be targeted, among them: Little Rock, Ark.; Atlanta; Charlotte, Greenville, Greensboro and Raleigh-Durham, N.C.; Charleston and Columbia, S.C.; Chattanooga, Knoxville and Memphis, Tenn.; Houston; Denver; Indianapolis; St. Louis; and all major Florida cities.
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