How many franchisee-operated Checkersrallys restaurants were closed during the period ending January 3, 2022?
Checkersrallys Franchise · 2025 FDDAnswer from 2025 FDD Document
ckers", "CDI", the "Company", "we", "our", or "us"), operates and franchises quick service restaurants in the United States under two similar operating brands, Checkers and Rally's.
The following table summarizes the number and mix of Company-operated and franchised restaurants in operation at the end of each period presented:
| For the Periods Ended | |||||||
|---|---|---|---|---|---|---|---|
| • | January 1, 2024 (Successor) | January 2, 2023 (Predecess or) | January 3, 2022 (Predecessor) | ||||
| Company-operated restaurants | |||||||
| Beginning of period | 255 | 266 | 264 | ||||
| New | 2 | ₩); | 3 | ||||
| Acquired from franchisee | 環形 | 3 | ( ) | ||||
| Sold to franchisee | 90 | (9) | = | ||||
| Closed | (19) | (5) | (1) | ||||
| End of period | 238 | 255 | 266 | ||||
| Franchisee-operated restaurants | |||||||
| Beginning of period | 585 | 585 | 594 | ||||
| New | 22 | 28 | 26 | ||||
| Acquired from the Company | 80 | 9 | - | ||||
| Sold to the Company | = | (3) | - | ||||
| Closed | (60) | (34) | (35) | ||||
| End of period | 547 | 585 | 585 | ||||
| Total restaurants operating at end of period | 785 | 840 |
Source: Item 21 — FINANCIAL STATEMENTS (FDD page 91)
What This Means (2025 FDD)
According to Checkersrallys's 2025 Franchise Disclosure Document, 35 franchisee-operated restaurants were closed during the period ending January 3, 2022. This information is based on the consolidated financial statements which include data about both company-operated and franchisee-operated restaurants. The table provides a breakdown of restaurant activity, including the number of restaurants at the beginning of the period, new openings, acquisitions, sales, and closures, ultimately showing the number of restaurants at the end of the period.
For a prospective franchisee, this closure rate provides insight into the stability and performance of existing franchise locations. High closure rates could indicate underlying issues with the franchise system, such as poor unit economics, lack of support from the franchisor, or market saturation. Conversely, a low closure rate suggests a healthier and more sustainable franchise network.
It's important to note that this data reflects closures during a specific period and may not be indicative of future performance. Factors such as economic conditions, changes in consumer preferences, and the franchisor's strategies can all influence closure rates. A prospective franchisee should investigate the reasons behind these closures and assess whether similar risks exist for new locations. Understanding the historical trends and the factors contributing to restaurant closures can help a franchisee make a more informed decision about investing in a Checkersrallys franchise.
In addition to closures, the table also shows that there were 594 franchisee-operated restaurants at the beginning of the period, 26 new franchisee-operated restaurants opened, and no restaurants were acquired or sold to the company. This provides a more complete picture of the changes in the Checkersrallys franchise system during that time.