Key Lessons Learned From Being Franchisee Owned For 10 Years

For years, the over 500-unit traditional American restaurant franchise, A&W Restaurants, was owned by YUM Brands. In December 2011, however, it was bought by its own franchisees via the National A&W Franchisees Association, NAWFA. After over a decade of franchisee ownership, the brand continues to see growth nationwide and has maintained a close-knit network of owners.

“The National A&W Franchisees Association represents all the franchisees,” said Pete Knight, NAWFA board member and multi-unit franchisee. “When it comes to spending and advertising, we administer all of that on behalf of the franchisees. We sit in a room with the company’s leadership and can disagree but are still on the same team.”

Though Knight was not on the NAWFA board at the time of the acquisition, he said that he knew the brand was for sale and was hoping that franchisees could buy it. He became involved with A&W at age 16 and has been growing with the company ever since. In the early years, prior to YUM Brands’ ownership, the work community felt like a family.

“Even though A&W is a business, it felt like they had the franchisees’ backs,” Knight said.

Craig Van Horn, another multi-unit franchisee, explained, “I’ve seen this change throughout my career with A&W, and this is the best ownership group we’ve ever had for the simple fact that we’re not owned by some large conglomerate trying to package us up and sell us to the next highest bidder.”

Both franchisees agree that belonging to a smaller, more independent company is going to ensure slow, steady growth that allows the brand to stay committed to its franchisees.

“The average franchisee can pick up the phone and talk to the president of A&W — he’ll take their call,” Knight said.

Van Horn added, “I don’t think we are going to grow as big and as quickly as other larger brands, but we are growing the right way.”

As A&W continues to grow, NAWFA works to lead and provide resources to franchise owners, streamlining processes and working toward collective success. Knight explained that, with A&W and NAWFA partnering, franchisees rarely see issues as they are headed off before they come to fruition. At quarterly meetings, he is able to voice the concerns of the franchisees he represents, and the association works collectively to develop a solution before dissatisfaction becomes overwhelming.

Kevin Bazner, A&W CEO, explained, “A&W has a legacy of community and collaboration. Owned and operated by franchisees, the entire A&W team has spent time in a restaurant — myself included. This model allows A&W and NAWFA to partner in a way that centers growth strategies on the needs, feedback and dreams of each franchisee. This way, we grow together.”

“Not being told what to do and instead being part of the process of figuring out what to do is the real difference,” Van Horn said. “We are a lot more independent as franchisees; because most of us have one or two stores, we’re able to be more involved. We like having that input.”

While the growth may not be as rapid as other franchises, A&W is still experiencing incredible success. Since its acquisition by NAWFA, same-store sales have increased year after year, reversing seven years of declines. In 2021, sales were up 10.2%, following 2020’s growth of 9.2%, and average unit sales are up over 67%%.

“Everyone feels like we’re moving in the right direction. Sales are up, especially compared to other franchises, and we’re developing new units around the country,” Knight said. Over 60  new restaurants have opened, and there are over 20 locations currently in development.

“We’ve been around for 100 years, and hopefully we’re looking at 100 more.”

The total investment necessary to begin operation, not including rent or land costs, is $871,000 to $1,469,554 for a Freestanding Restaurant; $401,000 to $1,051,088 for an Inline Restaurant; and $276,000 to $704,000 for a Captive Restaurant, including a $15,000-$30,000 franchise fee. For more information on franchising with A&W, please visit https://franchising.awrestaurants.com/