Jack In The Box 2008 Annual Report Download - page 11

Strategic Plan — Brand Reinvention. We believe that reinventing the JACK IN THE BOX brand by focusing on
the following three initiatives will differentiate us from our competition by offering our guests a better restaurant
experience than typically found in the QSR segment:
•Menu Innovation. We believe that menu innovation and our use of high-quality ingredients will further
differentiate JACK IN THE BOX from competitors, strengthen our brand and appeal to a broader base of
consumers. In recent years, we have successfully leveraged premium ingredients like sirloin and artisan
breads in launching new products unique to our segment of the restaurant industry. In fiscal 2008, we
developed several new menu items with three new product platforms including our real fruit smoothies, pita
snacks and breakfast bowls. Looking ahead, we have numerous products in various stages of ideation,
development and test as we continue to innovate and enhance our menu as a means to further differentiate
JACK IN THE BOX from other QSR chains.
•Service. A second major aspect of brand reinvention is to improve the level and consistency of guest
service at our restaurants. Over the last few years we have introduced several internal service initiatives to
help us attract higher-quality applicants for team-member positions, improve employee productivity and
improve retention levels at our restaurants. These initiatives include access to affordable healthcare for our
employees meeting certain requirements, an ESL (English-as-a-second-language) program for our Spanish-
speaking team members, and computer-based training in all of our restaurants. We believe these initiatives
have contributed to reduce employee turnover at our restaurants to all-time-low levels. Additionally, we are
leveraging new technologies to improve speed of service and guest satisfaction. In 2008, we expanded our
test of self-serve kiosks, which offer guests an alternative method of ordering inside JACK IN THE BOX
restaurants. We plan on installing the kiosks where the frequency of use is expected to be highest, based on
restaurants that experienced positive results in the test.
•Environment. The third element of brand reinvention is the major renovation of our restaurant facilities. In
fiscal 2008, 355 restaurants were re-imaged with a comprehensive program that includes a complete
redesign of the dining room and common areas. Interior finishes include ceramic tile floors, a mix of seating
styles, decorative pendant lighting, and graphics and wall collages. Other elements of the program may
include flat-screen televisions, music, new team member uniforms and product packaging, along with new
paint schemes, landscaping and other exterior enhancements. We are accelerating the pace at which we will
complete the exterior enhancements of our comprehensive restaurant re-image program. By the end of fiscal
2009, the exteriors of all restaurants, including franchise locations, are expected to be re-imaged. Interior
elements of the re-image program, including a complete redesign of dining rooms and common areas, are on
schedule to be completed system-wide by 2011. In fiscal 2008, we continued to develop our newest
restaurant prototype, the Mark 9, which distinguishes JACK IN THE BOX from our competitors through
innovative architectural elements and a flexible kitchen design that can accommodate future menu offerings
while maximizing productivity and through-put. Nineteen new locations opened during the year with the
new design, which features elements of the re-image program along with such distinctive building features
as poster marquees, decorative light fixtures, drive-thru viewing windows, and a fireplace with inside and
outside viewing. Several energy-efficient and environmentally friendly amenities are in test in our Mark 9
prototype, including tankless hot water heaters, water-saving utilities, solar panels and solar lighting tubes.
Strategic Plan — Expand Franchising. Our third strategic initiative is to continue expanding our franchising
operations to generate higher margins and returns for the Company while creating a business model that is less
capital intensive and not as susceptible to cost fluctuations. Through the sale of 109 company-operated JACK IN THE
BOX restaurants to franchisees and development of 15 new franchised restaurants, we increased franchise ownership
of the JACK IN THE BOX system to approximately 38% at fiscal year end. We remain on track with our long-term goal
to increase franchise ownership to approximately 70-80% of the system by the end of fiscal 2013. We also executed
development agreements with several franchisees to further expand the JACK IN THE BOX brand in new and existing
markets in 2009 and beyond. In fiscal 2009, we expect to refranchise 120-140 JACK IN THE BOX restaurants and add
14-19 new franchised locations to our system. The Qdoba system is predominantly franchised, and we anticipate
that future growth will continue to be mostly franchised. In fiscal 2008, Qdoba franchisees opened 56 restaurants in
existing and several new markets. We expect Qdoba franchisees to open 30-50 restaurants in fiscal 2009.
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