Marble Slab Creamery Strengthens Foothold in Canada with 40-Unit Development Deal
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Insights
The expansion of FAT Brands, specifically through the growth of Marble Slab Creamery in Canada, represents a strategic move to capture a larger market share within the Canadian dessert sector. Analyzing the competitive landscape, the introduction of 40 new franchised locations can be expected to increase brand visibility and potentially drive up same-store sales across the existing locations due to heightened brand awareness. The gradual rollout over a decade indicates a measured approach to growth, mitigating risks associated with rapid expansion.
Furthermore, the partnership with Canadian Ice Cream Company Inc. leverages local market expertise, which can be crucial for adapting to regional consumer tastes and preferences. This collaboration might also streamline supply chains and operational efficiency, reducing overhead costs and possibly improving profit margins over time. The long-term development deal suggests a commitment to sustained growth rather than short-term gains, which may appeal to investors looking for stable, long-term investment opportunities within the food and beverage industry.
From a financial perspective, the deal between FAT Brands and Canadian Ice Cream Company Inc. is likely to involve significant capital expenditure initially, with the expectation of incremental revenue growth as new stores become operational. It's important to consider how this expansion is financed and the impact on FAT Brands' balance sheet. If funded through debt, there could be concerns about leverage and interest coverage ratios. Equity financing, on the other hand, could dilute existing shareholders' stakes.
Investors should monitor the execution of the rollout and the subsequent performance of new locations against industry benchmarks such as average unit volume (AUV) and return on investment (ROI). The deal's success will hinge on the brand's ability to maintain product quality and service standards while scaling, which can affect customer loyalty and unit economics. A successful execution could lead to positive revisions in earnings forecasts and potentially an uptick in FAT Brands' stock price in the long run.
The focus on franchising as a growth strategy allows FAT Brands to expand with less capital expenditure and lower operational risk compared to corporate-owned stores. Franchisees bring in local business acumen and investment, which can lead to more tailored marketing strategies and potentially higher local market penetration. However, the management must ensure that franchisees adhere to the company's quality standards and operational procedures to maintain brand integrity.
It's also essential to evaluate the support and training systems FAT Brands provides to its franchisees to facilitate their success. The quality of these systems can significantly influence the customer experience and the overall performance of the new locations. A robust franchise model can result in a win-win situation, where franchisees achieve good returns on their investments and FAT Brands benefits from increased royalty revenues and brand strength.
Leading Ice Cream Chain to Grow Presence in Country to 140 Units
LOS ANGELES, Feb. 12, 2024 (GLOBE NEWSWIRE) -- FAT (Fresh. Authentic. Tasty.) Brands Inc., parent company of Marble Slab Creamery and 17 other restaurant concepts, announces a new development deal set to open 40 new Marble Slab Creamery franchised locations throughout Canada in partnership with Canadian Ice Cream Company Inc. The Marble Slab Creamery locations are set to open over the next 10 years, with the first of the new locations slated to open by the end of 2024. The development deal will bolster the brand’s presence from approximately 100 stores that are operating today in the country to 140 units.
“We are very pleased with the continued market growth in Canada with our experienced master franchise partner, Canadian Ice Cream Company Inc.,” said Taylor Wiederhorn, Chief Development Officer of FAT Brands. “Since entering the country nearly 20 years ago, Marble Slab Creamery has made a name for itself. Our homemade ice cream and unlimited mix-in philosophy resonate with fans and our franchisees as we continue to expand the concept across Canada and the world.”
For nearly 40 years, Marble Slab Creamery has been an innovator in the ice cream space, dreaming up the frozen slab technique and offering homemade, small-batch ice cream with free unlimited mix-ins, shakes in a variety of flavors, and ice cream cakes.
For more information on Marble Slab Creamery, visit www.marbleslab.com.
About FAT (Fresh. Authentic. Tasty.) Brands
FAT Brands (NASDAQ: FAT) is a leading global franchising company that strategically acquires, markets, and develops fast casual, quick-service, casual dining, and polished casual dining concepts around the world. The Company currently owns 18 restaurant brands: Round Table Pizza, Fatburger, Marble Slab Creamery, Johnny Rockets, Fazoli’s, Twin Peaks, Great American Cookies, Smokey Bones, Hot Dog on a Stick, Buffalo’s Cafe & Express, Hurricane Grill & Wings, Pretzelmaker, Elevation Burger, Native Grill & Wings, Yalla Mediterranean and Ponderosa and Bonanza Steakhouses, and franchises and owns over 2,300 units worldwide. For more information on FAT Brands, please visit fatbrands.com.
About Marble Slab Creamery
Since dreaming up the frozen slab technique and serving fresh homemade, small-batch ice cream in-store since 1983, Marble Slab Creamery has always known how to dream big. We sprinkle our customers with imagination and promise to inspire with infinite ice cream possibilities to feed your curiosity and capture cravings. With our free unlimited mix-in philosophy, delicious ice cream and shakes in a variety of flavors, hand-rolled waffle cones, and ice cream cakes, imagination has no limits. Today, Marble Slab Creamery is enjoyed by consumers across the globe with locations in Bahrain, Bangladesh, Canada, Kuwait, Pakistan, Saudi Arabia, Guam, Puerto Rico, and the United States. For more information, visit www.marbleslab.com.
Forward Looking Statements
This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including statements relating to the timing and performance of new store openings and area development agreements. Forward-looking statements reflect expectations of FAT Brands Inc. (“we” or “our”) concerning the future and are subject to significant business, economic and competitive risks, uncertainties and contingencies. These factors are difficult to predict and beyond our control, and could cause our actual results to differ materially from those expressed or implied in such forward-looking statements. We refer you to the documents that we file from time to time with the Securities and Exchange Commission, such as our reports on Form 10-K, Form 10-Q and Form 8-K, for a discussion of these and other factors. We undertake no obligation to update any forward-looking statement to reflect events or circumstances occurring after the date of this press release.
MEDIA CONTACT:
Erin Mandzik, FAT Brands
emandzik@fatbrands.com
860-212-6509
FAQ
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