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NRN Top 100: Frequently asked questions

NRN’s annual three-year look at the unit development and sales performance of the 100 largest foodservice chains, as ranked by annual U.S. systemwide sales, paints a picture of an industry whose forward motion not only sputtered to a halt for the first time in recent memory, but teetered precariously on the precipice dividing progress and regress.

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Why wasn’t my chain or company included?
If a chain did not generate at least $464.0 million in domestic systemwide sales in its latest year — the result attributed to the No. 100 chain in this year’s study — it will not appear in any of the Top 100 Chains listings. Similarly, a company had to generate at least $312.8 million in U.S. foodservice revenue to appear in this year’s Top 100 Companies ranking or in the rankings of companies on the basis of revenue growth rate. Thresholds for inclusion in the Second 100 companion report in the July 26 issue are $179.0 million for chains and $108.0 million for companies.

How do systemwide sales differ from revenue?
U.S. systemwide sales are a total for every domestic company-owned, franchised and licensed outlet within a chain or multiunit operation. Revenue are a company’s top-line income from food and beverage sales, generally from company-owned and -managed units and from foodservice-related fees and percentage-of-sales royalties collected from franchisees. For example, sales at every domestic McDonald’s restaurant constitute that chain’s U.S. systemwide sales. But Top 100 revenue for McDonald’s Corp. are limited to sales at the franchisor’s own branches in the United States as well as sales royalties and fees it collects from franchisees, excluding rents and other revenue it generates from sources other than food and beverage retailing.

When I multiply a chain’s sales per unit by its number of units, I don’t get systemwide sales. Why not?
Top 100 and Second 100 sales-per-unit figures are mathematical equations of systemwide sales growth and year-end change in number of units, and are done according to NRN’s proprietary formula. For consistency and comparability, NRN estimates partial-year sales contributions from units opened and closed during the respective years. Units with atypical sizes or sales capacities may be excluded.

What is meant by Top 100’s market share figures?
Within the context of Top 100, the “market” is the aggregate sales of only those chains ranked in the study within a specified segment or category. Market share is an individual chain’s proportional share of that total only during each of the three years compared.

Why do some Preceding-Year and Prior-Year rankings and data differ from presumably corresponding data and rankings in last year’s study?
The Top 200 statistical universe is unique each year, largely because growing entities qualify for first-time inclusion and supplant other entities. Moreover, each year’s research may yield new, more precise information, particularly with respect to privately held entities, necessitating revisions of previously reported data for comparable years. Or previously reported data may be restated from year to year to reflect continuing operations following newly completed mergers, acquisitions or divestitures. With respect to the separate rankings of the Top 100 and Second 100 entities in the June 28 issue and the July 26 issue, it should be noted that consecutive ranks of No. 1 through No. 200 are assigned only in the primary rankings of systemwide sales and corporate revenue. After the Top 100 and Second 100 groups are divided, subsequent rankings on the basis of growth, number of units, sales per unit and market share are assigned in two exclusive 1-through-100 ranges within the respective Top 100 and Second 100 statistical sets.

My chain appears on other industry sales rankings, yet it’s not included in yours. Why?
Varying studies employ different criteria. We believe Top 100 and Second 100 are the industry’s most meaningful surveys of domestic volume, growth and market trends because they compare leading organizations only on the basis of their consumer foodservice results in the United States, excluding nonfoodservice sales and revenue streams.

But my chain has more units or higher sales per unit than do some of the chains included in those rankings. Why wasn’t it included?
Only the Top 100 and Second 100 chains, as determined by systemwide sales, are ranked by such other criteria as number of units, sales per unit and rates of growth. In other words, the universe for those rankings is limited to chains that appear in the table titled “Top 100 [or Second 100] Chains Ranked by U.S. Systemwide Sales.”

My company’s revenue far exceed the figure shown for many of the corporations ranked in the Top 100, and yet you omitted my company. Why?
Companies were included among the Top 100 or Second 100 because of their foodservice revenue, not their total revenue. The Top 100 study attempts to exclude proceeds from all other business activities, such as manufacturing, distribution, general retail, nonfood contract services, property rental and amusements.

Some tables’ ranking numbers are duplicated, and some numbers are not assigned. Why?
Ties. Alphabetical order is not used to assign a lower ranking to chains or companies whose results exactly match those of other entities.

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