Jack In The Box 2010 Annual Report Download - page 4

Table of Contents
experience, including the substantial completion of our restaurant re-imaging program system-wide, which is targeted by the
end of 2011. Our newest restaurant prototype 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 throughput. In 2009, we unveiled a new logo that sends a clear signal to consumers that today’s Jack in the
Box is not the Jack of the past. The new logo now appears on packaging and uniforms and in our advertising. At fiscal year
end, nearly 15% of the system featured the new logo on restaurant signage.
  Our second 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 219 company-operated Jack in the Box restaurants to franchisees and the
development of 16 new franchise restaurants, we increased franchise ownership of the Jack in the Box system to approximately 57% at
fiscal year end from approximately 46% at the end of fiscal 2009. We are ahead of our plan to achieve our goal to increase the percentage
of franchise ownership in the Jack in the Box system to approximately 70-80% by the end of fiscal 2013. We also have executed
development agreements with several franchisees to further expand the Jack in the Box brand in new and existing markets in 2011 and
beyond. The Qdoba system is predominantly franchised, and we anticipate that future growth will continue to be mostly franchised. In
fiscal 2010, Qdoba franchisees opened 21 restaurants.
 This sweeping strategy involves focusing our entire organization on improving
restaurant profitability and returns as well as on administrative efficiencies. We will continue to focus on reducing food, packaging and
labor costs through product design, menu innovation and operations simplification, as well as pricing optimization. We expect our
selling, general and administrative expenses to further decrease as we continue reengineering our processes and systems and transition to a
business model comprised of predominantly franchised restaurant locations.
 
• . In fiscal 2010, 46 Jack in the Box restaurants opened, including 16 franchise locations. During the
year, we expanded our presence in several new contiguous markets in Texas, Colorado, Oregon, New Mexico and Oklahoma. In
fiscal 2011, 30-35 new company and franchise restaurants are planned as Jack in the Box will continue to expand into new
contiguous markets, including the Kansas City metropolitan area.
• . In fiscal 2010, 36 Qdoba restaurants opened, including 21 franchise locations, and franchisees expanded into
new markets in Illinois, Texas, New Mexico, West Virginia and Mississippi. Our Qdoba system is primarily franchised and is
the largest franchised Mexican-food chain in the fast-casual segment of the restaurant industry. In fiscal 2011, we plan to open
50-60 new company and franchise restaurants.

. Jack in the Box restaurants offer a broad selection of distinctive, innovative products targeted primarily at the adult
fast-food consumer. Our menu features a variety of hamburgers, salads, specialty sandwiches, tacos, drinks, smoothies, real ice cream
shakes and side items. Hamburger products include our signature Jumbo Jack®, Sourdough Jack®, Ultimate Cheeseburger and Jack’s
100% Sirloin Burger. Jack in the Box restaurants also offer premium entrée salads, specialty sandwiches, Teriyaki Bowls and every day
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. Jack in the Box restaurants also offer customers the ability to customize their meals and to order any product,
including breakfast items, any time of the day.
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 approximately 70% of sales at company-operated restaurants.
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