A&W Restaurants INFO
Established in 1919 in Lodi, CA as a roadside stand, A&W Restaurants is now a thriving part of the American experience. With 500-plus locations across the country, the brand remains a one-of-a-kind true original. Even its signature A&W Root Beer, served in an iconic frosty mug, is made fresh at the restaurant. Today, that traditional approach is resonating strongly with consumers, who are looking for authentic brands.
Why A&W? Why Now?
Over the past decade, A&W’s sales at its 500-plus U.S. stores have surged and are up 33% over 2011. In 2020, A&W restaurants experienced a 9% increase in year-over-year sales across its system.
The brand’s standalone drive-thru model saw a 14% increase in average unit volume in 2020 as well, separating the brand from the crowd during a year when most foodservice brands were suffering from dramatic sales dips.
That’s because this originator of quick-service restaurants has been ahead of the curve, understanding where customers’ preferences were heading long before the pandemic ushered in the curbside pickup and takeout craze, which A&W had perfected long before this year. The brand can thank its drive-thru model for much of the success it found before and throughout 2020, when dining rooms were closed in cities across the country.
“The growth we’re seeing is not pandemic momentum; it’s A&W momentum,” said John Palumbo, A&W’s senior director of franchise development. “Our restaurants appeal to virtually every demographic in every generation, and as we grow our footprint, our sales have grown right along with it.”
A&W’s success throughout 2020 puts it on a shortlist of foodservice brands that are coming out of the pandemic even stronger. And the brand is looking to grow in the upper Midwest, the Southwest, and the East Coast.
What Sets A&W Apart?
A&W Restaurants is owned by its franchisees and the company is governed by a board of franchisee representatives. Each representative serves two year terms on the National A&W Franchisee Association board, or NAWFA. This means the people who operate at the store level also have a direct impact on the decisions and directions that affect the brand, including food
“It’s really a collaborative environment,” said A&W Restaurants CEO Kevin Bazner. “Every decision we make about the brand that impacts or that touches a store is filtered.”
Another distinction that allows A&W to set itself apart in the mind of the consumer is its brand history, product quality and a tangible, exciting physical presence that cannot be replicated.
“A&W has been around for a century, and people have very strong emotional associations with the brand,” said John Palumbo, senior director of franchising. “Those associations are not just about the food; they are about the experience. We’ve worked very hard to maintain that in a landscape that increasingly prioritizes convenience over experience.”
A&W is preparing to welcome new franchisees into its family, starting with target development markets in Ohio, Michigan, Iowa, Minnesota and other parts of the upper Midwest. By the end of 2021, A&W is aiming to add 20 new freestanding restaurants to its system.
“A&W is a brand that does well just about anywhere you put it,” Palumbo said. “We’ve established restaurants in markets that most brands wouldn’t touch — towns with just a few thousand people — and they do a million in sales.”
“So many of our existing franchisees are fully prepared to grow their businesses and take on additional units, but as we look into new markets, we also want to bring in new talent, so we’re actively seeking qualified, passionate entrepreneurs who understand our brand and our model and who want to help us grow our footprint across the country,” he said.
Phil Welch of Franksville, Wisconsin is a third-generation owner who believes in the powerful connection people have to this brand and its history, and knows that has driven his family’s success. His grandparents built their first A&W in 1954 and he’s inherited their legacy. Welch thinks he will pass the business on to his children. “I have Root Beer in my blood,” he said. He says he and his wife “believe in the leadership of the brand, the franchisee-owned structure, the product, the brand’s history and its bright future.”
Why A Quick Service Restaurant?
As of 2019, there were an estimated 194,395 quick-service restaurant franchise establishments in the United States. The QSR model was a $273 billion industry in 2019, and while it saw a dip in 2020, A&W saw a continuation of a decade of tremendous growth.
Today, A&W currently has nearly 300 standalone restaurants in markets across the country.
As other QSRs scaled back their size and offerings, A&W found success, carving out a lane for itself as one of the few full-dining-room models left in the QSR space and staying true to its legendary brand. “When people think of A&W, they think of the frosty mug, and that’s something you can only get in the dining room,” senior director of franchise development John Palumbo said.
But that doesn’t mean A&W is stuck in the past. It also developed more modern service options for its customers throughout 2020 when dining rooms were closed in cities across the country, including its drive-thru model and digital ordering.
“It’s no surprise that drive-thru orders surged in 2020, but it says a lot that our franchise owners were fully equipped to make the pivot seamlessly,” said Liz Bazner, A&W’s director of digital. “As this franchise has grown and evolved, we’ve taken great care to ensure that we can provide multiple points of access for customers and multiple revenue streams for franchise owners. Last year showcased the importance of that level of flexibility.”
Why Franchisees Love the Brand
For franchisee Linda Mulder, A&W is a family affair. She started working in her dad’s Michigan A&W as a carhop when she was 12. Today, she helps run multiple A&W locations throughout Michigan and is also a member of the National A&W Franchisee Association board.
She likes working with the brand because she gets a 360-degree view of the management as a franchisee. Whether running a grill or helping set the direction alongside her fellow owners, Mulder says the brand is also like a family. “Everyone cares about the success and future of the brand – from the quality of the food to connecting with employees,” she said.
The total investment to franchise with A&W Restaurants ranges from $276,000 to $1,397,000, including a $15,000 to $30,000 franchise fee. For more information on franchising with A&W, please visit https://franchising.awrestaurants.com/