Jack In The Box 2005 Annual Report Download - page 20

Restaurant Concepts
JACK IN THE BOX. JACK IN THE BOX restaurants offer a broad selection of distinctive, innovative products targeted
primarily at the adult fast-food consumer. The JACK IN THE BOX menu features a variety of hamburgers, salads, specialty
sandwiches, tacos, drinks and side items. Hamburger products include our signature Jumbo Jack®, Sourdough Jack® and
Ultimate Cheeseburger. JACK IN THE BOX restaurants also offer premium entrée salads and sandwiches, to appeal to a broader
customer base, including more women and consumers older than the traditional QSR target market of men 18-34 years old.
Furthermore, JACK IN THE BOX restaurants offer value-priced products, known as “Jack’ s Value Menu,” to compete against price-
oriented competitors and because value is important to certain fast-food customers. In addition to offering high quality products,
JACK IN THE BOX restaurants offer customers the ability to customize their meals. Our customers may also elect to forgo the bun
and sauce in favor of a low-carb burger, or substitute ingredients to create a mix of flavors suited to their personal tastes. In
addition, our customers can order any product, including breakfast items, anytime of the day. We believe that our distinctive
menu has been instrumental in developing brand loyalty and is appealing to customers with a broad range of food preferences.
Furthermore, we believe that, as a result of our diverse menu, our restaurants are less dependent than other quick-service chains
on the commercial success of one or a few products.
The JACK IN THE BOX restaurant chain was the first major hamburger chain to develop and expand the concept of drive-
thru restaurants. In addition to drive-thru windows, most of our restaurants have seating capacities ranging from 20 to 100
persons and are open 18-24 hours a day. Drive-thru sales currently account for nearly 70% of sales at company-operated
restaurants.
The following table summarizes the changes in the number of company-operated and franchised JACK IN THE BOX
restaurants since the beginning of fiscal 2001:
Fiscal Year
2001 2002 2003
2004 2005
Company-operated restaurants:
Opened ...................................................... 126 100 90 56 38
Sold to franchisees..................................... (13) (22) (36) (49) (58)
Closed........................................................ (2) (3) (8) (2) (5)
Acquired from franchisees......................... 9 1 – – 1
End of period total..................................... 1,431 1,507 1,553 1,558 1,534
Franchised restaurants:
Opened ...................................................... 4 3 3 5 11
Acquired from Company ........................... 13 22 36 49 58
Sold to Company....................................... (9) (1) – – (1)
Closed........................................................ – – – – (1)
End of period total..................................... 331 355 394 448 515
System end of period total............................... 1,762 1,862 1,947 2,006 2,049
Qdoba. Qdoba restaurants offer a broad selection of fresh, high quality “Nouveau-Mexican” food with unique bold
tastes. The Qdoba menu fuses traditional Mexican flavors with popular flavors from other cuisines and features a variety of
signature burritos, the “Naked Burrito” (a burrito served in a bowl without the tortilla), non-traditional taco salads, 3-cheese
nachos and five signature salsas. Qdoba’ s broad menu allows it to satisfy multiple meal occasions, both dine-in and take-out, for
a wide variety of customers. Qdoba restaurants also offer a Q-to-Go® Hot Taco Bar catering alternative, tailored to feeding 20-
100, or more. The Q-to-Go Hot Taco Bar comes with everything from serving utensils to grilled steak and chicken, tortillas,
three unique salsas, toppings and dessert. The seating capacity at Qdoba restaurants ranges from 60 to 80 persons, including
outdoor patio seating availability.
Restaurant Expansion and Site Selection and Design
Restaurant Expansion. Our long-term growth strategy includes continued restaurant expansion. We opened 49 new
JACK IN THE BOX company-operated and franchised restaurants in fiscal 2005. In fiscal 2006, we plan to open 45-55 new
JACK IN THE BOX restaurants, including franchised units. Fiscal year 2006 restaurant growth will primarily be in existing markets,
however, we do plan to enter new contiguous markets using our QUICK STUFF brand.
Of the new JACK IN THE BOX restaurants forecasted in 2006, we plan to combine 13-15 with our branded convenience
store concept, QUICK STUFF. By operating a full-service QUICK STUFF store and a major branded fuel station with a full size
JACK IN THE BOX restaurant on one site, we are able to generate multiple revenue streams and profits, and grow our
JACK IN THE BOX brand using locations that would otherwise be too costly for a typical stand-alone QSR restaurant. In fiscal
2006, our convenience store concept will serve as a tool to enter new, contiguous markets, as we can benefit from the combined
revenues and shared development costs for three separate businesses while securing the best possible locations in high traffic
areas. In addition to providing site development flexibility, our branded convenience store concept also provides us with a solid
5