Houses For Sale London Ontario – Burger King

June 24, 2011

Main article: History of Burger King

The predecessor to what is now the international fast food restaurant chain Burger King was founded in 1953 in Jacksonville, Florida, as Insta-Burger King. The original founders and owners, Keith J. Kramer and his wife’s uncle Matthew Burns, opened their first stores around a piece of equipment known as the Insta-Broiler. The Insta-Broiler oven proved so successful at cooking burgers, they required all of their franchises to carry the device. After the original company began to falter in 1959, it was purchased by its Miami, Florida franchisees James McLamore and David R. Edgerton. The two initiated a corporate restructuring of the chain, the first step was to rename the company Burger King. The duo ran the company as an independent entity for eight years, eventually expanding to over 250 locations in the United States, when they sold it to the Pillsbury Company in 1967. Pillsbury’s management made several attempts at reorganization or restructuring of the restaurant chain in the late 1970s and early 1980s. The most prominent change came in 1978; Burger King hired McDonald’s executive Donald N. Smith to help revamp the company. In a plan called Operation Phoenix, Smith initiated a restructuring of all franchising agreements to give the company more oversight of its franchises,broadened its product offerings by adding new items to its menu, and laid out new store designs to standardize the look and feel of the company. While these efforts were initially effective, many of them were eventually discarded resulting in Burger King falling into a fiscal slump that damaged financial performance of both Burger King and its parent. Poor operating performance and ineffectual leadership continued to bog the company down for many years, even after it was acquired in 1989 by the British entertainment conglomerate Grand Metropolitan and its successor Diageo. Eventually, the institutional neglect of the brand by Diageo damaged the company to the point where major franchises were driven out of business and its total value was significantly decreased. Diageo eventually decided to divest itself of the money-losing chain and put the company up for sale in 2000.

In 2002, a troika of private equity firms led by TPG Capital, L.P with associates Bain Capital and Goldman Sachs Capital Partners agreed to purchase Burger King from Diageo for .5 billion (USD), with the sale becoming complete in December of that year.The new owners, through several new CEOs, have since moved to revitalize and reorganize the company, the first major move was to re-name the Burger King parent as Burger King Brands. The investment group initially planned to take BK public within the two years of the acquisition; this action was delayed until 2006 due to several reasons including the failure of its largest franchisee, AmeriKing. In May 2006 TPG took the chain public with a successful 5 million (USD) initial public offering (IPO), the largest for a U.S.-based restaurant in history at the time.

Some of the structural changes Burger King underwent under the ownership group’s watch were new advertising agency that created a series of new ad campaigns, a revamped menu strategy that focused on male consumers, a series of programs designed to revamp individual stores, and a new restaurant concept called the BK Whopper Bar. These changes led a score of consecutive profitable quarters for the company between March 2004 and March 2009 that successfully re-energizing the company. Despite this, the slowing of the economy during the financial crisis of 2007-2010 caused the chain’s business to decline while its immediate competitors McDonald’s grew.

The latest chapter in the company’s ownership history began in September 2010 when TPG and its partners announced it would sell their 31% stake in Burger King to another private equity company, 3G Capital, for (USD) per share, or .26 billion (USD). The offer, representing a 46% premium over the stocks selling price at the time, came as a surprise to Burger King CEO John Chidsey. The proposed sale is expected to help the company repair its fundamental business structures and continue working to close the gap with McDonald’s. Analysts commenting on the transaction stated that 3G will have to invest heavily in the company to help reverse its fortunes. David Palmer from UBS stated the company will need to work with its large group of franchise owners to brighten its locations and stabilize sales which could take several years and require significant reinvestment, while Steve West of Stifel Nicolaus stated that Burger King will need at least a year to right its fundamentals. After the deal was completed, the company’s stock was removed from the New York Stock Exchange ending a four year period as a public company.

International operations
See also: List of countries with Burger King franchises and Hungry Jack’s
Burger King in Chalco, Mexico City

While BK began its foray into locations outside of the continental United States in 1963 with a store in San Juan, Puerto Rico, it did not have an international presence until several years later. Shortly after the acquisition of the chain by Pillsbury, it opened its first international restaurant in Windsor, Ontario, Canada in 1969.Other international locations followed soon after: Oceania in 1971 and Europe in 1975 with a restaurant in Madrid, Spain.Beginning in 1982, BK and its franchisees began operating stores in several East Asian countries, including Japan, Taiwan, Singapore and South Korea.Due to high competition, all of the Japanese locations were closed in 2001, however BK reentered the Japanese market in June 2007. BK’s Central and South American operations began in Mexico in the late 1970s and by the early 1980s in Caracas, Venezuela, Santiago, Chile and Buenos Aires, Argentina. While Burger King lags behind McDonald’s in international locations by over 12,000 stores, it has managed to become the largest chain in several countries including Mexico and Spain. To assist in its international expansion, Burger King has established several subsidiaries to develop strategic partnerships and alliances to expand into new territories; in Europe, Burger King’s subsidiary Burger King Europe GmbH is responsible for the licensing and development of BK franchises in the that market, Africa and Western Asia. In Asia, the BK AsiaPac, PTE. Ltd. business unit handles franchising for East Asia, the Asian subcontinent and all Oceanic territories except Australia.

Australia is the only country in which Burger King does not operate under its own name. When the company set about establishing operations down under in 1971, it found that its business name was already trademarked by a takeaway food shop in Adelaide. As a result, Burger King provided the Australian franchisee, Jack Cowin, with a list of possible alternative names derived from pre-existing trademarks already registered by Burger King and its then corporate parent Pillsbury that could be used to name the Australian restaurants. Cowin selected the “Hungry Jack” brand name, one of Pillsbury’s US pancake mixture products, and slightly changed the name to a possessive form by adding an apostrophe ‘s’ forming the new name Hungry Jack’s. After the expiration of the trademark in the late 1990s, Burger King unsuccessfully tried to introduce the brand to the continent. After losing a lawsuit filed against it by Hungry Jack’s ownership, the company ceded the territory to its franchisee.
Burger King in Beijing International Airport, Beijing, China

Over the ten year period starting in 2008, Burger King predicted 80% of its market share would be driven by foreign expansion, particularly in the Asia-Pacific and Indian subcontinent regional markets. While the TPG-lead group continued BK’s international expansion by announcing plans to open new franchise locations in Eastern Europe, Africa and the Middle East, and Brazil, the company plans to focus on the three largest markets, India, China and Japan.The company plans to add over 250 stores in these Asian territories, as well as other countries such as Macau, by the end of 2012. Its expansion into the Indian market has the company at a competitive disadvantage with other fast food restaurants such as KFC because the country’s large Hindu majority’s aversion to beef. BK hopes to use their recent non-beef products, such as their TenderCrisp and TenderGrill sandwiches, as well as other products to help them overcome this hurdle to expand in that country.

At the end of its fiscal 2010 year, Burger King is the second largest chain of hamburger fast food in terms of restaurant locations restaurants in the world behind industry bellwether McDonald’s (32,400 locations) and the fourth largest fast food restaurant chain overall after Yum! Brands (37,000 locations), McDonald’s and Subway (32,000 locations).

Main article: Burger King franchises
Burger King restaurant in Leicester Square, London, United Kingdom

When Burger King Corporation began franchising in 1959, it relied on a regional franchising model where franchisees would purchase the right to open stores within a defined geographic region.These franchise agreements granted BKC very little oversight control over its franchisees and resulted in issues of product quality control, store image and design and operations procedures.

During the 1970s structural deficiencies in Burger King’s franchise system became increasingly problematic for Pillsbury. A major example was the relationship between Burger King and Louisiana-based franchisee Chart House, Burger King’s largest franchisee group at the time with over 350 locations in the United States. The company’s owners William and James Trotter made several moves to

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