Ghida Al-Sultan eyes 8-10 branch openings annually: CEO

Logo of Ghida Al-Sultan

Ghida Al-Sultan brought the number of Sultan Delight Burger branches to 60 by the end of Q1 2023, inching closer to fulfilling its 2023 expansion target of opening eight to 10 new branches annually, CEO Majed Musbahi told Argaam.

The fast-food firm leveraged Sultan Delight Burger restaurants by launching the Foil Burger cloud kitchen concept, reaching 25 points of sale (PoS) in only 75 days.

The main costs incurred by the Foil Burger cloud kitchen, which include the site rent as well as electricity and water bills, are covered by Sultan Delight Burger branches. Accordingly, profit margins reach 18-23% compared to 12-15% for Sultan Delight Burger restaurants.

In addition, food delivery applications account for 54% of Ghida Al-Sultan sales, said Musbahi. He stressed that the relationship between restaurants and these platforms should be properly managed as the latter charges fees at 17.5% of restaurants’ sales, including 2.5% for Mada online payment services.

These fees largely weigh on profitability, especially as many customers currently depend on delivery applications. Ghida Al-Sultan increases the delivery fees on par with costs, in order to maintain profit margins of its product portfolio.

Increasing the average check per order is key to maintaining good profit margins from delivery platform sales. This can be fulfilled by shifting customer focus to high-profit items and offering promotions to boost the average check value.

Musbahi also revealed the company’s plan to launch two new brands in the second half of 2023. This will help reinforce services provided via Sultan Delight Burger restaurants, which will bolster profit and revenue.