How Chick-fil-A Generates More Revenue Per Location Than Other Fast Food Restaurants
In 2023, Chick-fil-A generated the most revenue per location on average compared to any other fast food restaurant in the United States. In fact, they beat competitors by more than 2x, and they did so with one less day in the week (Chick-fil-A is not open on Sunday):
- Chick-fil-A: $8.7MM in revenue per location
- Shake Shack: $4.0MM in revenue per location
- McDonald’s: $3.0MM in revenue per location
So, how did they do it?
Upstream Ordering
Chick-fil-A pioneered the “upstream ordering” system, which consists of team members with tablets taking customer orders while in line instead of at the window. This allows them to have the quickest speed of service time in the industry at 107.41 seconds, even though they have the most cars in line on average at 5.45 per QSR. Restaurants generally have fixed operating hours, and the more efficiently you can get customers in and out of your drive-through line, the more revenue you can generate daily.
Location Selection
The location can make or break a fast-food restaurant. Unlike other franchises, Chick-fil-A owns the real estate for every one of its restaurants. They pick the location and build it to ensure it meets restaurant standards. This centralized decision-making process ensures Chick-fil-A has more quality control over restaurant locations than other fast-food franchises, which often rely on individual franchise owners to select their locations.
Selective Franchise Owner Application Process
Chick-fil-A is known for having one of the most selective and strict franchise owner application processes. Per The Wall Street Journal, Chick-fil-A selects approximately 130 out of 8,000 applicants yearly as new Chick-fil-A franchise owners. Chick-fil-A’s 1.63% franchise owner acceptance rate in 2023 is more competitive than getting into Stanford, which was 3.68% in 2023. Chick-fil-A also prohibits franchise owners from having other active business ventures, so each Chick-fil-A restaurant stays the priority for the franchise owner.
Look, it doesn’t hurt that Chick-fil-A has fantastic chicken. But McDonald’s, Shake Shack, and Taco Bell can satisfy cravings, too. The above strategies are why Chick-fil-A is seen as the gold standard in the fast food industry.
