What constitutes 'Same Store Sales' (SSS) for Benihana, and what factors are excluded from this calculation?
Benihana Franchise · 2024 FDDAnswer from 2024 FDD Document
Same Store Sales ("SSS"). SSS represents total food and beverage sales at domestic owned and managed restaurants opened for at least a full 18-month period at the beginning of each quarter, which removes the impact of new restaurant openings in comparing the operations of existing restaurants. For STK SSS, this measure includes total revenue from our owned and managed domestic STK locations, excluding revenues from our owned STK restaurant located in the W Hotel in Los Angeles, California due to the impact of the F&B hospitality management agreement with the hotel. Revenues from locations where we do not directly control the event sales force are excluded from this measure. We have presented four-year comparable sales to illustrate how sales at our restaurant base before the COVID-19 pandemic compare to sales post COVID-19 restrictions.
Our comparable restaurant base for STK SSS consisted of twelve domestic restaurants for the year ended December 31, 2023. For Kona Grill SSS, 24 domestic restaurants are included in the comparable restaurant base. STK and Kona Grill SSS decreased 3.0% and 2.2%, respectively for 2023 compared to the prior year. On a four-year basis, STK SSS increased 64.1% while Kona Grill SSS increased 23.6%.
Source: Item 22 — CONTRACTS (FDD pages 73–74)
What This Means (2024 FDD)
According to Benihana's 2024 Franchise Disclosure Document, Same Store Sales (SSS) is a key performance indicator that measures the total food and beverage sales at domestic owned and managed restaurants. To be included in the SSS calculation, a restaurant must have been open for at least a full 18-month period at the beginning of each quarter. This metric is used to assess the performance of existing restaurants by removing the impact of new restaurant openings.
For the STK brand, which is part of Benihana, the SSS calculation includes total revenue from owned and managed STK locations within the United States. However, there are specific exclusions. The revenue from the STK restaurant located in the W Hotel in Los Angeles, California, is excluded from the STK SSS calculation due to the F&B hospitality management agreement with the hotel. Additionally, revenues from locations where Benihana does not directly control the event sales force are also excluded from the SSS measure.
Benihana uses the SSS to compare current sales to pre-COVID-19 sales, illustrating the impact of the pandemic and subsequent recovery. For example, the FDD states that for the year ended December 31, 2023, the comparable restaurant base for STK SSS consisted of twelve domestic restaurants, while Kona Grill SSS included 24 domestic restaurants. STK and Kona Grill SSS decreased 3.0% and 2.2%, respectively for 2023 compared to the prior year. On a four-year basis, STK SSS increased 64.1% while Kona Grill SSS increased 23.6%.