McAlister’s Deli surpassed $1 billion in systemwide sales last year—the first of GoTo Foods’ brands to hit the milestone.
That’s up from $956 million in 2022 and McAlister’s has more than 530 stores open across 29 states, mostly concentrated in the southern United States.
“$1 billion felt great, but we’re already looking at $2 billion. That feels even better,” Chief Brand Officer Mike Freeman said. It took 35 years to get to $1 billion, he said, but it won’t take another 35 to get to the next billion.
He attributes increased sales in part to McAlister’s loyalty program and its emphasis on catering.
“We’ve seen massive improvements year over year through operational excellence,” like service speed and food quality, Freeman said. The brand is managing 11 revenue channels, including catering and curbside pickup. “We’re just going to continue to make some innovative decisions around what we want to take to market.”
The company, known for its sweet tea and Giant Spuds baked potatoes, is one of seven franchises in GoTo’s portfolio, which includes Auntie Anne’s, Cinnabon and more. The company earlier this year announced its name change from Focus Brands to GoTo Foods.
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McAlister’s catering service now has menu options for all dayparts after launching its breakfast menu last year. The company has food bars, boxed meals and, of course, gallons of its sweet tea.
When the brand is seeking out new franchisees, “their passion is what really needs to shine,” Freeman said.
The cost to open a McAlister’s Deli unit ranges from $9231,450 to $2.3 million, according to the brand’s franchise disclosure document.
Average net sales across 431 franchised units in 2022 were $1.9 million, according to its Item 19. The overall range was $540,281 to $5 million.
“Our new stores are setting records every time we open them,” Freeman said. “So these franchisees who are coming into the system are pretty eager to get after it, which is great.”
McAlister’s Deli has a “really robust” development pipeline for the next five years. The brand has multi-unit deals signed for Minnesota, Delaware and Salt Lake City.
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The majority of McAlister’s business comes from dine-in customers, but digital sales are increasing by means of a pickup window, Freeman said.
“It’s not a traditional drive-thru experience,” he said. Customers order on the McAlister’s app and pull up to the restaurant, tap “I’m here” on the app and then pick up meals through the window.
“It’s a great option for us,” Freeman said.
This year, in an effort to give guests more ordering flexibility, McAlister’s is adding a table service option so customers can order from their tables. “For larger groups, families, bad weather—we have a solution for just about everything,” he said. “The flexibility of our brand is what has people coming back more often.”