Chick-fil-A to Shift 400 Locations to Owner-Operator Model

Chick-fil-A has announced a significant transition for approximately 400 of its locations, moving away from its non-traditional restaurant model. This change, confirmed on March 6, 2024, will see the majority of these licensed locations converted to an owner-operator structure over the next several years, fundamentally altering the customer experience.

The existing licensed model allowed food service providers to operate Chick-fil-A restaurants in various venues, including colleges, airports, and healthcare facilities. However, these non-traditional outlets often featured limited menu options and served fewer customers compared to full-sized franchised locations. As part of the transition, Chick-fil-A will maintain its airport locations under the current model, ensuring continuity for travelers.

The shift aims to enhance the guest experience significantly. By adopting the owner-operator model, customers at these newly converted locations will now be able to utilize the Chick-fil-A app and loyalty program, as well as redeem gift cards. This change is expected to streamline services and improve customer satisfaction across the board. Additionally, employees at these locations will benefit from access to the company’s scholarship program, further promoting a supportive workplace environment.

Chick-fil-A stated, “We are excited about this next chapter and believe our local ownership business model will allow us to serve and care for guests and extend the great food and hospitality of Chick-fil-A in more places, for many years to come.” This sentiment underscores the chain’s commitment to improving operations while staying true to its core values of service and quality.

Financially, the transition is a strategic move aimed at boosting sales. According to the company’s franchise disclosure document, licensed campus units generate an average of $1.4 million in annual sales. In contrast, non-traditional locations in airports and hospitals achieve around $3.5 million in average unit volume (AUV). Both figures are significantly lower than the over $9 million generated by standard Chick-fil-A locations. By shifting to the owner-operator model, the company anticipates that access to branded assets will enhance sales performance at these units in the long run.

As of December 2023, Chick-fil-A operated 425 licensed units nationwide, with the majority—312 units—located on college or university campuses and 97 situated in airports, hospitals, and other businesses. The chain has a substantially larger number of franchised locations, exceeding 2,600 in the United States.

In parallel with this transition, Chick-fil-A is testing a new breakfast offering, dubbed “America’s favorite breakfast combo,” marking a significant addition to its menu. This initiative reflects the chain’s ongoing commitment to innovation and responsiveness to customer preferences.

As Chick-fil-A embarks on this transformative journey, the company aims to enhance the overall dining experience while ensuring its business model remains robust and profitable.