Franchise demand grows due to low capital intensity and high revenue potential
New franchisees require $3-5 million in liquidity to qualify. The company expects US franchise openings to incur capital investment costs of $3-4 million. Locations pay franchise fees, territory fees, royalties and marketing support fees. Beginning in 2022, Fogo de Chão will target annual growth of 15% revenue growth from company-owned restaurants. IBIS World estimates demand for Premium Steak Restaurants increased at an annualized rate of 2.3% over the five years to 2022, with 7.2% growth in 2021.
Balance Sheet|New Activity|StructuralIn response to volatile demand in the wake of the first COVID-19 surge, the company undertook a comprehensive cost reduction program, aimed at shoring up labor and supply costs.
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