Krystal restaurants looking to sell 100-plus locations as part of revitalization program
Published 4:48 pm Wednesday, October 30, 2019
Krystal, arguably the South’s first fast-food restaurant chain made popular by its small, square hamburgers, plans to sell more than 100 of its company-owned locations.
The company says the potential sales will be well-capitalized restaurant operators and is part of its ongoing revitalization plans.
To that end, Krystal has engaged The Cypress Group, a specialized investment banking firm, to manage the refranchising initiative. Restaurants in Alabama, Florida, Georgia, Mississippi and Tennessee will be refranchised.
“We’re ready for the next step in the brand transformation that began when I came on board in 2018,” said Paul Macaluso, Krystal president and CEO. “We’ve seen great success with the new restaurant prototype, remodels and operational upgrades. It’s time to accelerate the redevelopment of the fleet and expand our footprint through strategic refranchising.”
Macaluso added that the sales lifts from upgrading to a newer, smaller and more efficient prototype have been unlike others he has seen in his 25-year QSR career.
The brand has rebuilt nine restaurants since 2018, generating first year-over-year comp sales ranging from +29.8 percent to +107.5 percent for the periods each has been opened.
“While we don’t need full remodels on all the restaurants we intend to sell, we believe these facility investments demonstrate the appeal of Krystal,” he said. “Same menu, same location, just a new building – and you see how people really flock back to the brand. We now want to bring this elevated experience to our customers across our footprint.”
Krystal was founded in Chattanooga, Tennessee, in 1932.