Jack In The Box 2014 Annual Report Download - page 7

of a minimum base rent or a percentage of gross sales. The franchisee is usually required to pay property taxes, insurance and ancillary costs, and is
responsible for maintaining the restaurant.
Qdoba Mexican Grill. The current Qdoba franchise agreement generally provides for an initial franchise fee of $30,000 per restaurant, a 10-year term with
a 10-year option to extend at a fee of $5,000, and marketing fees of up to 2% of gross sales. Most franchisees are also required to spend a minimum of 2% of
gross sales on local marketing for their restaurants. Royalty rates are typically 5% of gross sales. We offer development agreements to franchisees for the
construction of one or more new restaurants over a defined period of time and in a defined geographic area for a development fee, a portion of which may be
credited against franchise fees due for restaurants when they are opened. If the developer does not maintain the required schedule of openings, they may
forfeit such fees and lose their rights to future development. We continue to pursue non-traditional locations both through multi-location commitments and
single unit franchise agreements. To enhance our multi unit non-traditional growth, we may offer agreements that provide for lower fees. Currently, the non-
traditional franchise agreements we enter into provide for a $30,000 initial franchise fee, a 6% royalty rate and no marketing fees.
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Jack in the Box and Qdoba restaurants are operated by a company manager or franchise operator who is directly responsible for the operations of the
restaurant, including product quality, service, food safety, cleanliness, inventory, cash control and the conduct and appearance of employees.
Jack in the Box. Company restaurant managers are required to attend extensive management training classes involving a combination of classroom
instruction and on-the-job training in specially designated training restaurants. Restaurant managers and supervisory personnel train other restaurant
employees in accordance with detailed procedures and guidelines using training aids available at each location.
For Jack in the Box company operations, vice presidents supervise directors of operations, who supervise district managers, who in turn supervise
restaurant managers. Under our performance system, these management levels are all eligible for periodic bonuses based on achievement of goals related to
restaurant sales, profit and/or certain other operational performance standards.
Qdoba Mexican Grill. At Qdoba company restaurants, we focus on attracting, selecting, engaging and retaining people who share our values to create
long-lasting positive impacts on operating results. Our Qdoba Career Map is the core development tool used to provide employees with detailed education
by position, from entry level to area manager. High performing restaurant managers and hourly team members are certified to train and develop employees
through a series of on-the-job and classroom trainings that focus on knowledge, skills and behaviors. The Team Member Progression program within the
Career Map tool recognizes and rewards three levels of achievement for our cooks and line servers who showcase excellence in their positions. Team
members must have, or acquire, specific technical and behavioral skill sets to reach an achievement level.
For Qdoba restaurant operations, vice presidents supervise directors of operations, who supervise district managers, who in turn supervise restaurant
managers. All levels are eligible for quarterly performance bonuses based on goals related to restaurant sales, profit optimization and other operations
performance standards.
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Company-operated and franchise-operated restaurants devote significant resources toward ensuring that all of our restaurants offer quality food and
excellent service. To help us maintain a high level of customer satisfaction, our Voice of Guest program provides restaurant managers, district managers, and
franchise operators with ongoing feedback from guests who complete a short guest satisfaction survey via an invitation provided on the register receipt. In
these surveys, guests rate their satisfaction with key elements of their restaurant experience, including friendliness, food quality, cleanliness, speed of service
and order accuracy. In 2014, the Jack in the Box and Qdoba systems received more than 2.1 million and 0.2 million guest survey responses, respectively. We
also have a “mystery guest” program at Jack in the Box that provides restaurant managers, district managers, and franchise operators feedback on guest
service as evaluated by “secret shoppers” who visit the restaurant. Finally, our Guest Relations department receives feedback that guests report through our
toll-free number and via our website, and communicates that feedback to restaurant managers and franchise operators.
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