Does Benihana plan to expand operations domestically and internationally?
Benihana Franchise · 2024 FDDAnswer from 2024 FDD Document
We recognized an $18.5 million gain on CARES Act Loan Forgiveness in 2021, partly offset by a $0.6 million loss on early debt extinguishment related to the partial paydown of our credit facility.
Our Growth Strategies and Outlook
Our growth model is primarily driven by the following:
Expansion of STK. We expect to continue to expand our operations domestically and internationally through a mix of owned, licensed and managed STK restaurants using a disciplined and targeted site selection process. We have identified over 75 additional major metropolitan areas across the globe where we expect we could grow our STK brand to 200 restaurants over the foreseeable future. We expect to open as many as five to six STKs annually, primarily through company-owned locations and management or licensing agreements, provided that we have sufficient interest from prospective licensees, acceptable locations and quality restaurant managers available to support that pace of growth.
In 2021, we opened an owned STK restaurant in Bellevue, Washington, two managed STK restaurants located in Scottsdale, Arizona and London, United Kingdom and one licensed STK restaurant located at the Los Cabos International Airport in San Jose del Cabo, Mexico. Additionally, we have under construction owned STK restaurants in Dallas, Texas and San Francisco, California and a managed STK restaurant in Stratford, United Kingdom.
Expansion of Kona Grill. We expect to expand our operations domestically using a disciplined and targeted site selection process. We believe we could grow the Kona Grill brand to 200 restaurants over the foreseeable future. We expect to open as many as three to five Kona Grills annually, primarily through company-owned locations, provided that we have acceptable locations and quality restaurant managers available to support that pace of growth.
Source: Item 22 — CONTRACTS (FDD pages 73–74)
What This Means (2024 FDD)
According to Benihana's 2024 Franchise Disclosure Document, the company intends to expand both domestically and internationally. Benihana aims to grow its STK brand, with plans to establish up to 200 restaurants globally in major metropolitan areas. The company anticipates opening five to six STKs annually through a combination of company-owned locations, management agreements, and licensing agreements. This expansion strategy depends on sufficient licensee interest, suitable locations, and the availability of qualified restaurant managers.
In addition to STK, Benihana plans to expand its Kona Grill brand domestically, also targeting a growth of up to 200 restaurants. The company expects to open three to five Kona Grill locations each year, primarily through company-owned establishments. Similar to the STK expansion, this growth is contingent on securing acceptable locations and having capable restaurant managers.
Benihana is also focusing on expanding through new Food & Beverage (F&B) hospitality projects. The company expects this business segment to significantly contribute to its growth and profitability by generating leads for managed STK restaurants and management fee income. Benihana intends to leverage its brand strength and relationships with global hospitality providers to further develop its F&B hospitality business, with plans to enter into one to two new F&B hospitality agreements annually. This multi-faceted approach indicates a comprehensive strategy for growth across various brands and business models.