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Jack-in-the-Box-Drive-Thru-Only-Tulsa-OK.jpg Jack in the Box Inc.
Jack in the Box opened its drive-thru-only prototype in Tulsa, Okla., about nine months ago.

Jack in the Box says drive-thru-only prototype outperforms expectations

9-month-old digital-oriented unit in Tulsa, Okla., generates average weekly sales of about $43,000, company says in Q2 earnings call

Jack in the Box Inc.’s drive-thru only prototype, which opened last fall in Tulsa, Okla., continues to out-perform targets, company executives said Wednesday.

The San Diego, Calif.-based quick-service company, which also owns the Del Taco brand, is “generating average weekly sales of approximately $43,000,” said Darin Harris, Jack in the Box CEO, in an earnings conference call for the second quarter, which ended, April 16.

“We're also seeing about 15% of sales coming through digital, aided by food lockers for speed and convenience,” Harris said. “The restaurant has been open for about nine months, has all of our latest equipment and we have seen a much higher level of sustained out-performance in terms of AUV and sales, particularly compared to the honeymoon curve we typically see in a newly open location.”

The Tulsa drive-thru-only location covers about 1,350 square feet and was designed for digital ordering and to reduce construction costs.

It features a double y-lane drive-thru, a walk-up window for ordering, dual assembly kitchens and a dedicated pickup window for mobile and third-party delivery orders.

One goal of the new prototype is to reduce buildout costs by around 20%, while also increasing real estate flexibility, the company said. The new model is designed for free-standing locations, but it can be adapted to fit convenience stores, travel plazas and end-cap locations.

Along with quarterly earnings, Jack in the Box on Wednesday announced that it had signed development agreements to open franchised units in Mexico for the first time in three decades and would enter the Montana and Wyoming markets with both the Jack in the Box and Del Taco brands.

Jack in the Box signed a 22-unit commitment in four northern Mexican states.

“This was a natural fit to expand our brand into Mexico. Our goal was to find an experienced restaurant operator with infrastructure and local ties to develop our brand internationally,” said Tim Linderman, Jack in the Box chief development officer. “It also made sense strategically to expand our brand along the border due to our strong brand recognition and the number of restaurants near this region. The Terrazas family brings tremendous experience to the Jack in the Box franchise system and are the perfect franchisees to expand our brand into Mexico.”

Harris said staffing levels had returned to near pre-COVID levels, and the company was adding back more late-night hours across its system, which had a positive impact on transactions in the quarter.

For the second quarter ended April 16, Jack in the Box reported net earnings of $26.5 million, or $1.27 a share, compared to $7.8 million, or 37 cents a share, in the same period a year ago. Revenues in the quarter rose 22.8% to $395.7 million from $322.3 million in the same period a year ago.

Jack in the Box same-store sales increased 9.5%, and Del Taco same-store sales increased 3.2% in the quarter, the company said.

As of April 16, the company had 2,187 Jack in the Box units and 495 Del Taco locations systemwide.

Contact Ron Ruggless at [email protected]

Follow him on Twitter: @RonRuggless

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