Jack in the Box Site Requirements

This is Dustin Thompson, and welcome to another episode of Franchising Unboxed. I'm here with my great cohost, Mike Wootton and John Pearson. And today, we've got a really good episode. I feel I mean, I feel like it's a very impactful episode because we're talking to, you know, franchise candidates in the process. Real estate always ends up being one of the key focuses of their our initial conversations and ongoing conversations because, you know, real estate, whether you know it or not, is gonna be a large part of, you know, the timeline it takes to find your location, build your location. And, honestly, real estate is what, you know, people buy. Right? That's what you're when you see a franchise or a Jack in the Box on the side of the road, that's what you're seeing is the real estate with the building on top. So real estate is very key, for the process. So today, we have a special guest. Her name is Nicole Curtis. She's a real estate manager here at Jack in the Box, and we're gonna go ahead. And if you can, Nicole, just share your background. What got you into real estate originally? Kinda what brought you to real estate? Tell us how long you've been with Jack in the Box, and tell us about your experience, with just real estate overall. Well, first of all, thank you guys for having me. I'm very excited to do this, and I appreciate you having me on. So a little bit about myself. I'm a real estate development manager for Jack in the Box and Del Taco, and I've been with the company for almost five years. I support franchisees for both brands with their real estate needs. Prior to joining Jack in the Box, I was a real estate development manager for Qdoba and worked with franchisees with their real estate needs there also. I've been in the real estate industry for twenty five years and have extensive new store development experience as well as experience working with franchisees throughout much of the United States. You know, what got me into real estate, I was selling commercial real estate, and, I blindly, applied for a retail real estate position. Got that. I wasn't sure how it would go, and then the remaining twenty five years are history. I love what I do. I love real estate. I love working with franchisees, and, it's a great blend, making it a super, super rewarding and fun job. Fantastic. Fantastic. Nicole, thanks for joining us again. I hadn't had a chance to say hi to you, so, welcome. Thank you so much. We're gonna kinda, yeah, we're gonna kinda start at the beginning. So we're gonna ask you a couple questions and just kind of learn a little bit about how kind of the support process works with our franchisees. So kinda take us from the beginning. So we have a new franchise candidate. They decide they want to do a development agreement with us. They sign the development agreement. Everybody's excited. We do a kickoff call. We turn this individual or this group over to you as a new franchise group. Kinda take us from there. What does the support look like? How does that process get started? Sure. So, first step, I partner with you guys and work with you guys, and sometimes the franchisee, to first identify strong trade areas within a market based on several factors. Some of those factors include regionality, and retail traffic generators, demographics, traffic counts, competitor sales of other brands. And then once that is identified and we have the development agreement signed, I usually most often make an introduction to our tenant rep broker in a market, that we've worked with that knows what we look for and, work closely, with us and their franchisee to help identify real estate opportunities for the franchisee. We encourage the franchisees to work with the brokers just so that they can have the most opportunity to identify and find good sites, that we support. After that, we conduct site tours of potential real estate opportunities for consideration and assist a franchisee in identifying a site and selecting a good viable site with strong characteristics and strong, criteria that Jack in the Box would support. And that, again, would give, the franchisee a a very good chance of, having successful sales. After a site is identified, we do a site review and evaluate sites, either that we've identified with the franchisee or that a franchisee has identified and submitted to us. We evaluate those sites for alignment with brand requirements and provide feed feedback on ingress, egress, access, visibility, parking, all all of those things. We'd like to say even if a site is, super visible, but you can't get to the site or access is poor, then, that's a challenge. So we just kind of go over for the franchisee all of those different characteristics and make sure everyone is aligned, on those criteria. After that, we'll then work with the franchisee and advance to the real estate committee review. That is where I will then, take all the information, the site plan that the franchisee has submitted and prepared and present a franchisee's proposed site to, real estate committee for corporate approval of their site. After that, we let them know that the site has been approved, and, they can move forward with their lease process or purchase process and move on to the construction level. So with that, let's kind of walk through some of those steps independently because I think this is a very unique process that a lot of people don't necessarily, you know, know all the support that comes along with the process. So first question I would have is, when you talk about tenant broker networks, kind of explain what that is, and do the franchisees have to pay an additional fee for that? That's a common question, I guess. Yes. Sort of as well. That is a perfect, perfect question. And to your point, a lot of people do have, some confusion or don't understand that exactly. Typically, in most markets and especially new markets we go into or really any market, most of us real estate development managers, we have strong relationships with the brokerage community, also with developers, owners in a market. And so we've partnered with a real estate broker that represents just they represent our brand. So they're not representing the landlord and just trying to only present sites from a landlord. They really, work with us understanding what our criteria is, what we look for. They help us even in the beginning identify key intersections and one mile trade areas that, would be very strong trade areas in a market. A lot of that is based on the regionality I talked about earlier. So we kind of partner with them. Like I said, you know, we're their client. The landlord is not their client. So they have our best interest and a franchisee's best interest, at heart. When I introduce, a franchisee to a tenant rep broker in a market, the one thing that I like to make sure a franchisee understands, this does not cost them anything. Jack in the Box doesn't pay the broker. The franchisee doesn't pay the brokerage commission. Our interest is their best interest, but when a deal is identified and, either sold or leased, the landlord or the property owner pays a real estate broker's commission. So it's actually, you know, another level of a free service for the broker. Most of I mean, for a franchisee, most of those brokers out in a market are very, very connected with owners. Some of the benefits, a lot of times they know off market opportunities that may not be advertised or just have a sign a for sale sign or a for lease sign, on their property. So I just always stress to to a franchisee, that it's just another level of a complimentary or a free service that they can take advantage of to help, you know, get more boots on the ground and helping to identify great sites without it costing them anything. Yeah. I think that's key, especially with you know, when you pay the franchise fee, a lot of people ask, what comes with that franchise fee? And I think this is just a large, you know, benefit of what you get with that franchise fee, right, or all those benefits. So Yeah. Absolutely. Yeah. You talk about trade areas. So walk me through how does how does Jack in the Box define trade areas? And what are the things that we do? What is a good trade area with Jack in the Box? How do we go out and map those out? I know here we use. So, SiteWise, how do we use software and things like that to identify sites for potential franchisees? And even more importantly, we use market points, and that's a terminology that a lot of people aren't necessarily familiar with whether they know it or not. It's very common, especially with larger brands. But kinda walks through market points, how we identify those, and how we put together those trade areas using our, mapping software. Sure. Absolutely. So first of all, a market point is simply a pin that is dropped at a key intersection within a one mile trade area. So it it's just a point that identifies that one mile trade area where we and the franchisee can look for a site, that would be, a good site, to consider for development. And, typically, what we do and what I like to do with SiteWise, which is our analytics program, they go through a market and based on all different algorithms and different things from traffic to competitor sales, traffic generators, you know, like the presence of large retail traffic generators like Walmart, Target, Costco, major grocery stores in the market. The presence of those, those elements, it identifies key trade areas that would potentially have been a strong trade area for a franchisee to consider. Then what the real estate development managers do, we look at those trade areas. Often, those need to be tweaked a little bit. It can be tweaked need to be tweaked from a couple of blocks up to half a mile or a mile. So based on our market knowledge, we all have very extensive market knowledge in different markets. So based on our market knowledge, boots on the ground from traveling to those markets, feedback from the brokers, we then adjust those market points to maybe an intersection, that would be maybe a stronger intersection, if needed. Sometimes it's not needed. But then that way, the market is really, adjusted and tweaked so that those market points or pins, if you will, of the one mile trade areas are adjusted to combine both the analytics recommendations with the real estate development managers and brokers, boots on the ground and expertise in the market. So for the market point, you know, once a franchisee feels like they like a specific market point or a one mile trade area, they can select that market point or one mile trade area to include in their development agreement. And that gives us basically a one mile radius to go out and look for a site for that trade area or market point. So, Nicole, quick question. So a lot of times franchisees call us. They've got ideas about, areas that they wanna go into or they own or have potentially an option on a piece of property. What are some of, like, the key pointers you would give someone that hasn't started working yet with our team about how they would wanna go out and look for drive through ready, fast food type markets that are ready for quick service restaurants? What are some of the pointers you would give them, as far as what they should be looking for as they start to think about, you know, becoming a potential franchisee with with our brand or any brand? Right. So a couple of points that I would, recommend them or advise them on is, just to be careful to select the best real estate, regarding access, visibility, trade areas, traffic, along the roads. And don't just go for if it's very easy to do. We all do it with all different products, but don't necessarily just go for the least expensive real estate, but go for the best real estate. You know, in the end, that can make a difference in being successful or not. So really look for those strong characteristics of excess visibility. You know, obviously, we love hard corners, signalized hard corners. So some of those things, you know, are key elements that I would, advise, a franchisee to look for. Another thing that I would advise a franchisee to do, and we see this often, is really keep an open mind when you're looking for real estate. Consider all of your options. Don't just be so set on only purchasing real estate and not doing a ground lease or a building lease or a conversion opportunity of a closed location. Often purchase opportunities, they're a little bit more scarce. They're more competitive. And so sometimes the purchase opportunity of real estate may be a site that's mid block where you can lease a signalized hard corner that's a better piece of real estate, but it's for lease. So that would be the other thing that I would, strongly advise to a franchisee. You know, when they start looking at these things is to really keep an open mind on their options. We all like to own our real estate, but keep an open mind in looking at those opportunities so that you get the best opportunity and the best real estate. And then, you know, from my perspective, I would just also advise a franchisee to really take advantage of what Jack in the Box provides to them. Really, try to align and work closely with the real estate development manager and also the broker, to vet these sites and to find sites and take advantage of complimentary services that help, you know, we can all work together as a team, and it really, you know, it works great. We're kind of a team on the ground in a market then. So those are several things that I would advise a franchisee to look at. Let's talk about timelines. One thing that we get asked about is, you know, we give an eighteen to twenty four month timeline typically for the first store. And some people, if you've worked in the franchise development industry, you've opened a fast food franchise before, that's, you know, you understand that timeline. But if you've never been in this, why the long timeline? Why the eighteen to twenty four months a lot of people see? And we've talked about this in a previous episode, but people often say, well, they see a restaurant being built. They think the timeline of the entire project was just the construction phase. And I'm like, no. You're missing out a lot that came before the construction phase. Walk us through. What what takes eighteen to twenty four months, and what do you typically see or some of the things that really push that timeline? Right. And that's a great question because once a building is under construction, that's kind of the shortest amount of the time frame that you'll see. But when you first identify a site, you've got to negotiate that site whether it's a purchase or a ground lease or a building lease. A franchisee would need to negotiate, the terms of that agreement. And then once it's approved in real estate committee go to lease. A franchisee may be very aggressive and wanting to really work quickly to get all those negotiations done. Sometimes that goes quickly. Sometimes the person on the other end, either an owner or a landlord, they may not work as quickly. So sometimes that's out of the franchisees control or out of our control. Hopefully, it it moves quickly and it just goes through that process, very quickly and move on to the next step. But I do always say, depending on, landlords, owners, you never know. Sometimes you can't control their speed in negotiating a contract. That's one element that can, really, make a difference in the timeline. Once you get a site approved in real estate committee and then either a purchase and sell agreement executed or a lease executed, then you can move on to having your drawings done. I usually recommend once a site is approved and in real estate committee that franchisee is ready to go working with their architect, having, getting the drawings done, the concept drawings done so that then they can be really ready to go once the lease is signed to kind of just fine tune those concept drawings, get them in the city for permitting. Once the drawings are into the city for permitting, this is one of the longest steps that we typically see, and that a franchisee typically sees in the development process that can slow, the building process down and delay them getting started in building. Some municipalities are very easy. The process just goes right through. I would say a typical time frame for getting permitting if it's an easy municipality without a lot of issues or or delays would be a hundred and eighty days or six months. So we usually recommend, you know, at least building that a hundred and eighty days time frame in and possibly, you know, the ability to have one or two thirty day extensions of that also. This process, if it's a municipality that's notoriously a little bit more difficult to work with, that process can turn into a lengthy process that does delay the project. You know, it could be it could take a year to get permits or maybe last, maybe longer. So that's the portion of the process that honestly, takes the most amount of time and where we see the most delays. And, you know, often, you can have the architect turn their request around quickly, but then you're still looking at delays for reviews and things like that. Once you do get permits on hand, you can build quickly. You know, we typically look at maybe a hundred and fifty days, and that's give or take a little bit. We've had franchisees that build in less than that amount of time or some that take a little bit longer, but that process is pretty smooth from that point. Alright. That was really good information. And I think it just helps understanding the timeline as well. When you say eighteen to twenty four months, understanding that a lot of that is outside of our control, especially when it comes to things like permitting. So one question I always like to ask, what is one thing a franchisee, what should they know before they get into real estate, working with you in the real estate side? What is something they should know or something that you think is most commonly overlooked? Sure. So one thing that, I tend to see a lot, is I think a franchisee should really have a really good understanding of what their timeline looks like for their development agreement. You get the first site done and everyone is all excited. We're excited for the franchisee. The franchisee is excited. And, so one thing that is easy to get caught up in is getting that first site approved, but then knowing that you need to immediately go on and start looking for that second site, of your development agreement commitment because time passes quickly and, for that second site and then the third site so that we're all aligned on, you know, and continuing to monitor that so that we don't get behind in any of those processes of staying current with the development agreement timeline. Let's keep it moving on finding sites. Wow. Fantastic. Thanks so much, Nicole, for joining us today. We could probably keep you on for another, twenty, thirty minutes easy just kinda going through all of the different facets of what you do day to day. If you'll have us, we'd love to have you back sometime, talk some more because there's I'm sure there's other things we can we can cover. I do feel like we've given, the viewers of this video, some great information on what it's like to kinda get into the real estate process of franchising. Thanks again for everybody for joining us today. And if you're ready to begin your franchising journey with Jack in the Box, you can fill out the forms on our website, and a member of our team will be back in touch. Most likely, it'll be Dustin or myself. Thanks for watching, everybody. Thanks again, Nicole. Thanks, Dustin, and, we'll see you next time. Thanks for having me, guys.