Zaxby's Exceeds Growth Expectations With 120 Franchise Commitments

Zaxby's is having the kind of year most restaurant chains can only dream about. The chicken chain started 2025 aiming to sell 100 franchise commitments - a big jump from the roughly 70 sold in 2024. Instead, it's on track to close out the year with 120 commitments.

"We're up about 2x, so it's been a good year," said Mike Mettler, chief development officer, during an interview at the recent Restaurant Finance & Development Conference in Las Vegas.

That's no small feat. Industry sales have been soft, traffic has been negative, and consumers have been pulling back on their spending. But Zaxby's has several advantages working in its favor.

For starters, it operates in the high-demand fast-casual chicken category. The chain also generates strong average unit volumes of $2.71 million as of the end of 2024, according to Technomic. That figure not only attracts franchisees - it's also helping Zaxby's secure more drive-thru conversions, which have become a competitive advantage.

"Fundamentally, certain systems' AUVs can no longer support a drive-thru and there have been a lot of closures recently. I think something like $1.5 million is now too low and that was not the case (in 2019)," Mettler said. "There aren't enough drive-thrus to accommodate everybody who wants a drive-thru, so we are in a better position to compete for those locations and that's providing some conversion opportunities for us."

Conversions have grown from 5% to 10% of Zaxby's openings to 15% to 20%.

Another major factor fueling growth is the brand's new Modern Farmhouse design, introduced as part of its "Grow to Win" plan. The company now offers six building types for franchisees to choose from - seven if you count conversions - including non-traditional and drive-thru-only prototypes. Before, there was just one 3,000-square-foot box.

The smaller prototypes lower building costs by up to 70% depending on the model, giving franchisees more flexibility and helping Zaxby's aim for 25% cash-on-cash returns.

"We have a strong proposition, and we now have a proof point. It's powerful when the building design is no longer just on a piece of paper, but it's real," Mettler said. "The new design is essentially what is enabling our growth because it's relevant, efficient, flexible. It's bold and beautiful and you can see what it stands for. People now know we're selling Famous Fingers and sauces. It's been a huge turning point for the brand."

The new designs are also opening doors to non-traditional locations. In October, Zaxby's signed its first non-traditional agreement to open on a military base - a first in the brand's 35-year history.

Deals aren't just getting signed, either. The chain expects to end this year with about 50 new restaurants open, with 60 or more planned for 2026.

"The restaurant business isn't a strategy business, it's an execution business, so we're focused on what we can control, which is how good is the operator, the site, the opening plan, the marketing strategy," Mettler said. "I want to be in the consideration set for anyone thinking about getting into the chicken business because I think Zaxbys is the best option, and we have a strong plan that is working."

Zaxby's finished 2024 with 969 units and $2.6 billion in sales, according to Technomic.

by Alex Bailey | December 31, 2025 | SHARE