Culver's is Quietly Becoming a Fast-Food Powerhouse (2024)

Culver's is Quietly Becoming a Fast-Food Powerhouse (1)

Culver's

On the front lines, Culver’s boasts a Crew Challenge initiative that rewards the system’s top teams for excellence in service and hospitality, with a total of $100,000 in total annual prize money.

The chain should near 1,000 locations before the year is over.

Story

Culver's is Quietly Becoming a Fast-Food Powerhouse (2)

Culver's

On the front lines, Culver’s boasts a Crew Challenge initiative that rewards the system’s top teams for excellence in service and hospitality, with a total of $100,000 in total annual prize money.

Culver’s growth designs weren’t swayed much by the early swings of the pandemic. Its comp sales climbed about 6 percent in 2020 over the previous year as it opened 50 units—the same figure as 2019. Same-store sales jumped 19 percent in 2022, and Culver’s kept growing.

According to data from the brand’s recently filed FDD, few chains in fast food are expanding as consistently as the 1984-founded chain, which remains family owned and operated alongside an investment from Inspire Brands, Subway, and GoTo Foods’ backer Roark Capital, which provided Culver’s its first capital infusion in 2017 as a minority stakeholder.

Culver’s lifted by a net of 52 locations in 2023, per the FDD. It’s positioned to approach 1,000 in 2024 as it exited with 944 (937 of which were franchised). Culver’s, as mentioned, opened 50 stores in 2019 and 2020, respectively, and followed with 55 net openings apiece in 2021 and 2022, meaning the company has added 262 locations since 2019.

Openings:

  • 2019: 50
  • 2020: 50
  • 2021: 55
  • 2022: 55
  • 2023: 52
  • 2024 (estimated): 51

It’s projected to expand by 51 this year, with 60 franchise agreements signed and outlets still waiting to be opened. If that happens, Culver’s would cross into 2025 with 995 restaurants.

Culver’s started franchising in the 1980s. In the first decade of doing so, it brought just fewer than 100 units to market. And it’s closed three franchised restaurants in 36 years (one last year).

Culver’s transferred 49 from franchisees to new owners in 2021—a number that dropped to 37 and 16 in the ensuing two years.

As the company explored with a new marketing push in 2022, there are some similarities to Chick-fil-A in the way it generates exclusive appeal through regional ties, as well as how tight its process to join the system can be. Culver’s requires anybody applying for a franchise to work at least six 10-hour days in one of its restaurants.

That growth expanded outward over the years from high-density centers of awareness. But you can see below how Culver’s has started to seed some new DMAs, carrying that fan-driven cult-fervor and curiosity along with it.

WHY CULVER’S WAS NAMED ONE OF QSR’S BEST BRANDS TO WORK FOR

The first non-Wisconsin Culver’s opened in 1995 in Buffalo, Minnesota, with a Roscoe, Illinois, unit opening later the same year. It spread to Iowa in November 1997 and outside the Midwest in February 1998 with a Texas location.

At the end of 2023, Culver’s home state of Wisconsin had 142 franchised stores, up four from 2021. All seven company units are in The Badger State as well. The brand opened one, year-over-year.

How it broke down on the franchised side.

Current franchised stores open and operating (Wisconsin has 142)

  • Alabama: 11
  • Arizona: 36
  • Arkansas: 2
  • Colorado: 23
  • Florida: 102 (this number was just 81 in 2021)
  • Georgia: 21
  • Idaho: 4
  • Illinois: 135 (125 in 2021)
  • Indiana: 78 (also a big push from 59 in 2021)
  • Iowa: 37
  • Kansas: 8
  • Kentucky: 16
  • Michigan: 96 (85 in 2021)
  • Minnesota: 61
  • Missouri: 42 (35 in 2021)
  • Nebraska 13
  • North Carolina: 15
  • North Dakota: 8
  • Ohio: 25
  • South Carolina: 10 (doubled since 2021)
  • South Dakota: 14
  • Texas: 14
  • Tennessee: 9
  • Utah: 14
  • Wyoming: 2

Looking at 2024, Culver’s, as noted, expects to reel off 51 stores. That Florida surge will continue with 13 openings on deck.

Projected openings for 2024 (Florida is 13)

  • Alabama: 3
  • Georgia: 1
  • Illinois: 2
  • Indiana: 8
  • Kansas: 3
  • Michigan: 5
  • Minnesota: 2
  • Missouri: 1
  • North Carolina: 3
  • Ohio: 2
  • South Carlina: 3
  • Tennessee: 1
  • Wisconsin: 3

Through this recent growth chart, Culver’s sales followed. The chain’s average-unit volume across 871 counted stores (that didn’t include 2023 openings or 13 franchised restaurants that aren’t typical locations, including three without a drive-thru window, six that share a building with a convenience store, and four that occupy an endcap of a multi-tenant building) was $3.487.5 million.

Culver's is Quietly Becoming a Fast-Food Powerhouse (3)

The nearly $3.5 million result, going by year-end 2022 performance, would put Culver’s sixth among the 50 top-grossing quick-serves in America, trailing Chick-fil-A ($6.7M), Raising Cane’s ($5.44M), Shake Shack ($3.8M), Whataburger ($3.725M), and McDonald’s ($3.625M).

Culver’s number is also a material rise from 2022, when it was $3.28 million and 2021, when it clocked in at $3.099 million. Culver’s AUV in 2020 was $2.624 million and $2.435 million in pre-COVID 2019. In sum, Culver’s emerged from the pandemic making roughly $1 million-plus more per location than it did going in.

According to The Wolf of Franchises, Culver’s touts expected margins of about 12 percent, or $420,000 or so per location.

Culver’s systemwide U.S. sales were $1.73 billion at the end of 2019. That number lifted to $1.986 billion in 2020, $2.489 billion in 2021, and $2.830 billion in 2022 (2023 has not been revealed yet).

One thing to note as well, in markets with nine or fewer Culver’s, the AUV figure was $3.372 million. For markets with 10 or more, it came in at $3.535 million. So while there’s uplift with maturation, new DMAs aren’t lagging significantly, either.

Units within a half mile of an interstate enter or exit ramp reported AUVs of $3.691.6 million. Those not in that distinction: $3.408 million.

Population metrics were steady, too:

Culver's is Quietly Becoming a Fast-Food Powerhouse (4)

As were household income reflections:

Culver's is Quietly Becoming a Fast-Food Powerhouse (5)

And the ability to compete in or anchor a market:

Culver's is Quietly Becoming a Fast-Food Powerhouse (6)

Franchise revenue for Culver’s in 2023 was $236,209,862, up from $200,139,448. Company sales lifted to $27,599,972 from $22,004,765.

So total operating revenues closed 2023 at $263,809,934 over $222,144,213.

Net income in 2023 rose to $106,298,651—a year-over-year hike from $75,559,111.

It exited the calendar with $52,346,934 in cash and cash equivalents. That was $46,172,572 at the end of 2022.

Culver’s history dates back four decades to when Craig and Lea Culver, along with Craig’s parents George and Ruth, opened the restaurant as a single family-owned spot in Sauk City, Wisconsin. Craig wanted to bring the frozen custard he tried in college to fresh audiences. Culver’s then used an ice cream scoop to place fresh, never frozen beef on a griddle, which it smashed with a spatula and placed atop a buttered toasted bun (what it calls ButterBurgers). That’s the method still used today—everything made fresh to order— alongside a wide-ranging menu that includes cheese curds sourced from a Wisconsin family farm.

More recently, Culver’s introduced a new smoky, thick-cut bacon. Culver’s cooks the product with a propriety method, it said, leaving it chewy on the side with the edges crisped on the grill.

Coming into COVID, Culver’s didn’t offer online ordering. But it was able to sustain and then elevate volume through its drive-thrus, which often morphed into double-lanes as the brand’s off-premises growth surged ahead of in-store gains.

In 2019, drive-thru mixed about 55 percent of sales for Culver’s. It rocketed to 90 percent during the depths of 2020 and settled “around 60 percent,” the brand previously told QSR. Meanwhile, online ordering became “very, very important” and stuck around as a growing channel.

Fast Food, Finance, Story

Culver's is Quietly Becoming a Fast-Food Powerhouse (2024)

FAQs

Culver's is Quietly Becoming a Fast-Food Powerhouse? ›

The chain should near 1,000 locations before the year is over. On the front lines, Culver's boasts a Crew Challenge initiative that rewards the system's top teams for excellence in service and hospitality, with a total of $100,000 in total annual prize money.

Who is Culver's biggest competitor? ›

Culver's vs competitors
CompanyFounding DateZippia Score
Wendy's19694.3
Sonic Drive-In19534.3
Burger King19544.5
Dairy Queen19404.1
17 more rows

Is Culvers better than in and out? ›

In-N-Out Burger's patrons frequently laud the freshness of the burgers and the classic simplicity of the menu, offering variations that have become iconic such as "Animal Style." Culver's, on the other hand, is celebrated for its butter burgers and the wider selection including seafood and frozen custard.

What is the slogan for Culver's? ›

Culver's motto is, “Welcome to Delicious,” and our experience was that it is. The franchise founded in Wisconsin, features ButterBurgers and frozen custard treats as its signature dishes.

Who owns Culver's fast food? ›

The Culver family retains majority ownership.

Who owns the most Culver's franchises? ›

“And keep reminding them, and people will get there. And they will be so happy when they do.” Chad Stevenson, left, and Jeff Liegel of S&L Companies are the largest Culver's franchisees with nearly 100 restaurants in five states and 50 owner-operators.

Who is Chick Fil A's biggest competitor? ›

Indeed, Kalinowski Equity Research noted all the way back in 2018 that Chick-fil-A's biggest competitor is McDonald's and it's no wonder why the Golden Arches and seemingly every other QSR concept (and beyond) have since ignited a chicken sandwich war replicating the Atlanta-based chain's signature product.

What is Culver's most famous for? ›

Culver's is a fast-food restaurant that started in Wisconsin and has since expanded to 26 states. The chain is known for its ButterBurgers, cheese curds, and frozen custard. I'd never been before, but my mom loves it — so my husband and I recently tried it out.

Why is Culvers called Butterburger? ›

We call our ButterBurgers “ButterBurgers,” not because they've been cooked, marinated, dunked, fried or drizzled with butter but because we lightly butter the crown of the bun for an extra touch of goodness. (Where else would you expect such a delicious idea than from the dairy state?)

What kind of meat do Culver's use? ›

Our ButterBurgers® are made with our special blend of three cuts of beef: sirloin, chuck and plate. All prized cuts, all well-marbled for richness and flavor with no fillers to get in the way. When it comes to beef, you want fresh beef. Frozen beef loses moisture and when you lose moisture, you lose flavor.

What state has the most Culver's? ›

As of June, 2024, there are 998 Culver's restaurants in the United States. These restaurants are located in 26 states and territories and 793 cities. The state with the most Culver's locations is Wisconsin, with 136 restaurants.

How much is it to franchise a Culvers? ›

What is the initial franchise fee? Each new franchisee currently pays an individual franchise fee of $55,000 to acquire a Culver's franchise for the basic 15-year term of the franchise agreement. If you qualify, you may renew for an additional 10 years for an individual franchise fee of $30,000.

Is Culver's a Midwest thing? ›

The Culver family has strong roots in Midwestern supper clubs. Inspired by the way a good fish fry could bring friends and neighbors together, Craig carried the tradition forward. We still batter each filet by hand and cook it to order, only after you order.

Who is McDonald's biggest competitor? ›

McDonald's is one of the largest and most well-known fast-food chains in the world. Privately-owned Burger King is McDonald's closest competitor. Yum Brands operates Taco Bell, KFC, and Pizza Hut. Subway is the largest restaurant chain in the world in terms of size, but sales have been sliding since 2012.

What is the target market for Culvers? ›

Stidham said Culver's considers its targeted marketing demographic to be the “CMO,” or chief meal officer, of the family, and that typically is a young mother or father.

Where is the largest Culver's in the United States? ›

You can find the world's largest Culver's in Edgerton, Wisconsin, which is just southeast of Madison. It's a smaller town with a population of just under 6,000.

Who is Arby's biggest competitor? ›

Arby's main competitors are Chipotle Mexican Grill, Jack in the Box, and White Castle.

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