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question regarding profitabilty of a little ceasars franchis

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Re: question regarding profitabilty of a little ceasars fran

DFW,

You dont run a LC do you? It seems you know the operations quite well.

I am considering either taking one over in a market or opening one in an area I live.

Have you ran one in the past, or currently and if so what are your comments?

I worked at one years ago when they ran over the market and were kicking a$$, marketing like crazy and scaring the hell out of PH and Dominos (back then PJs wasnt around), so I know the operations and margins.

If you have opinions, let me know, I would value them quite a bit.
 
Re: question regarding profitabilty of a little ceasars fran
Anonymous:
DFW,

You dont run a LC do you? It seems you know the operations quite well.

I am considering either taking one over in a market or opening one in an area I live.

Have you ran one in the past, or currently and if so what are your comments?

I worked at one years ago when they ran over the market and were kicking a$$, marketing like crazy and scaring the hell out of PH and Dominos (back then PJs wasnt around), so I know the operations and margins.

If you have opinions, let me know, I would value them quite a bit.
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I am well known by one of the rep’s for the DFW market. They came to me about a year ago begging to take over/turnaround one of their stores. They were actually willing to give me the store for basically free. I gave it serious thought, did significant due diligence and then passed.

I think LC is a great choice for some though, just that one was not right for me at that time. If they offered today, I would probably do it. I am in negotiations with a local chain to TX to do the exact same thing.

If you want to contact me to discuss specifics on LC PM me, or email me [email protected]

Due to confidentiality, I cannot divulge much, especially on a public forum, but on email I will answer what I can.
 
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Re: question regarding profitabilty of a little ceasars fran

First, I’ll start off by saying my store does NOT do $1 million a year in sales. If it did however, based off my break even, I would be profiting over $6,500/week.

$6,500/week x 52 weeks = $338,000/year.

Guys, it’s very possible to hit the numbers described. DFW is right on. Just remember, after you hit your break even mark you make about 35 cents on the dollar. If your break even is $5k/week and you do $20k:

$15k x 35 cents = $5250 per week in profits.

-J_r0kk
 
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Re: question regarding profitabilty of a little ceasars fran

DFW

Sent you an email this PM

😃
 
Re: question regarding profitabilty of a little ceasars fran

Hi J_rokk,
Can I copy the LC concept & still be profit as an independent? Is there a big difference in food cost? Advantage 1, I do not have to pay franchise fees. 2, am not tied/limited to the franchise concept.
trying to figure total cost differential per pie.
 
Re: question regarding profitabilty of a little ceasars fran
Guest:
Hi J_rokk,
Can I copy the LC concept & still be profit as an independent? Is there a big difference in food cost? Advantage 1, I do not have to pay franchise fees. 2, am not tied/limited to the franchise concept.
trying to figure total cost differential per pie.
Click to expand...
3 do not have the brand or name awareness 😦
 
Re: question regarding profitabilty of a little ceasars fran
Anonymous:
Guest:
Hi J_rokk,
Can I copy the LC concept & still be profit as an independent? Is there a big difference in food cost? Advantage 1, I do not have to pay franchise fees. 2, am not tied/limited to the franchise concept.
trying to figure total cost differential per pie.
Click to expand...
3 do not have the brand or name awareness 😦
Click to expand...
Actualy, I don’t wotty much about no. 3
Small town. 22k ppl. everybody will know me if I do $5 pie. Plus “Americans will buy pizza from bin laden mart if it was the cheapest” I read somewhere and believe is true.
Cost differentil with LC is what I was trying to figure out.
 
Re: question regarding profitabilty of a little ceasars fran

I would like to know if there is a single indepent operator who runs $5 pie and is successful ?
 
Re: question regarding profitabilty of a little ceasars fran

I’ve never tried the concept of the $5 pie. However, with my ingredients (a little higher quality but not premium) the cost for my large one topping is just under $2 which translates to 40% food cost if I sell 100% $5 pizzas. Naturally, your product mix will probably offset this food cost % a little, but I’d be safe to say your food cost % will probably still be in the upper 30’s.

If you’re going to do something like this you’ll have to depend on volume to get your labor % down. Mileage % will take care of itself with the bulk of your customers picking up. In order to be successful with this kind of venture I’d say a 22% Labor or lower (including your salaried manager) would be required.

Again, this is NOT my area of expertise but more of an educated guess. From time to time I’ll run a campaign like this but for no longer than a week, and in most cases just a weekend. When I limit the number of days of this price point I see significant sales increases which in turn lower my labor costs to help offset the higher food costs. Your target FLM% - < 60%

-J_r0kk
 
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Re: question regarding profitabilty of a little ceasars fran

Thanks j_rokk,
I believe you could also save some adv. $$. Price point itself with $5 pie is a very good advertisement to start with.
 
Re: question regarding profitabilty of a little ceasars fran

Yeah, you don’t have to work too hard to bring your volume up wiyh $5 concept. Just shut up make pizzas, they will come.
 
Re: question regarding profitabilty of a little ceasars fran

But it is not as attractive when everyone in town does a $4.99 pie and some have even resorted to $3.99 and one nutjob even does $2.99!
 
Re: question regarding profitabilty of a little ceasars fran

I wonder how long they(LC) can keep it at $5 with ever increasing cheese prices and labour costs?
 
Re: question regarding profitabilty of a little ceasars fran
Guest:
I wonder how long they(LC) can keep it at $5 with ever increasing cheese prices and labour costs?
Click to expand...
Exceedingly mercenary and lean opperations, I would suspect. They save money on the other ingredients, and have ruthless negotiations for rent and other costs. I would lay money they also have a looooong cheese contract negotiated long past any spike we may see today.
 
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Re: question regarding profitabilty of a little ceasars fran

Although my experience with Little Caesar’s is somewhat limited I do know that they palce larger orders for fridge magnets than my typical clients and pay their bills…The ones I have dealt with do not seem to have the cash flow problems I have seen from other clients…RCS…
 
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Re: question regarding profitabilty of a little ceasars fran

as we’ve discussed all b4…volume cures all ills…

tho I’m not a rabid fan of LC (I’m from Detroit, their hometown) they have a couple store near me…always busy w/the $5 Hot 'n Now program…

I had a pie @ a competitor’s last night…decent pie/interesting concept…but not worth the $16 (16" supreme) but better than the $5 LC I got for my son late last year…

I’m still struggling w/the new store concept whether that should be the model I use, considering the location, the dirge/cost of retaining drivers etc…

Can I make a “cost effective” decent pie in the $5-$7 range and have folks “flock” 2 my place?

Look @ Patron’s Pizza…they’re doing it…
 
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