Ruth's Chris Steak House Franchise

Financial Health Notes

Ruth's Chris Steak House Franchise, LLC demonstrates financial stability as an indirect, wholly-owned subsidiary of Darden Restaurants, Inc., with audited financial statements showing positive net income. As of May 26, 2024, Ruth's Chris Steak House Franchise, LLC reported $28.185 million in net income. The company's cash transactions are managed by its parent company, Darden Restaurants, Inc., resulting in a significant intercompany receivable balance of $256.9 million, indicating that cash is held by the parent. There are no concerns about substantial doubt regarding the company's ability to continue as a going concern, and management believes legal matters will not materially affect its financial position.

Ongoing Support

After opening, Ruth's Chris Steak House Franchise, LLC provides ongoing support to its franchisees, including optional computer software upgrades and enhancements at a reasonable cost. Ruth's Chris Steak House Franchise, LLC representatives make periodic visits to evaluate the restaurant's products and services. The franchisor offers initial training for replacement or successor management personnel, for which a fee may be charged, and may also provide continuing or additional training programs and seminars. Franchisees receive advice and written materials on restaurant management techniques, updates on equipment and food products, purchasing specifications, and approved supplier lists, and participate in system-wide meetings and conferences, which may also incur a fee. Ruth's Chris Steak House Franchise, LLC also administers the Global Marketing Fund for marketing and advertising initiatives and provides sample promotional materials.

Territory Size Requirements

Ruth's Chris Steak House Franchise, LLC grants franchisees the right to establish one Ruth's Chris Steak House restaurant at a location acceptable to the franchisor. The specific location of the restaurant will be identified in the Franchise Agreement as the 'Location'. Once the Location is identified, Ruth's Chris Steak House Franchise, LLC will assign the restaurant an 'Assigned Area'. This Assigned Area may be defined as an area within a certain radius surrounding the restaurant, or it may be encompassed by streets, zip codes, cities, counties, states, or natural boundaries. The factors used to determine the Assigned Area include population densities, geographic limitations and constraints, marketing audiences, competition, existence and proximity of other System Restaurants, and traffic/growth patterns. Within this Assigned Area, Ruth's Chris Steak House Franchise, LLC commits not to establish or authorize any other traditional System Restaurant, provided the franchisee remains in full compliance with the Franchise Agreement. Additionally, Ruth's Chris Steak House Franchise, LLC assigns an 'Area of Primary Responsibility' to the franchisee. This area is where the franchisee is expected to make reasonable efforts to advertise and promote the restaurant, consistent with their pre-approved advertising program. The Area of Primary Responsibility is generally composed of the zip codes and/or counties immediately adjacent to the Assigned Area and is not exclusive to the franchisee, except where it overlaps with the Assigned Area. Ruth's Chris Steak House Franchise, LLC reserves the right to operate or authorize others to operate System Restaurants at non-traditional locations (such as airports, convention centers, casinos, sports stadiums, and similar venues) even within the Assigned Area. The franchisor also retains rights to advertise, sell collateral products, offer similar products under other trademarks, operate other restaurants under different names, and conduct e-commerce or other distribution channels within the Assigned Area, without compensating the franchisee.