What it costs to open 12 of the biggest fast food chains in the US, from Chick-fil-A to McDonald's

A Chick-fil-A restaurantMichael Siluk/UCG/Universal Images Group via Getty ImagesBecoming a franchisee for a fast food restaurant is one road to running a business.But costs and requirements vary widely depending on the restaurant chain.Business Insider compiled a list of financial requirements to become a franchisee for 12 major fast food chains.A fast food franchise can be a lucrative business. One top performing Chick-fil-A restaurant reported sales of over $17 million in 2021, more than double the average per unit sales volume for the chain, according to Chick-fil-A's 2022 franchise disclosure document. Other chains also say that franchisees can earn millions of dollars a year from a single store.Opening a franchise requires a hefty amount of cash to cover the startup costs, though. Many chains require franchise fees in the tens of thousands of dollars as well as personal worth requirements in the hundreds of thousands, for instance.There are also ongoing monthly fees for royalties, advertising, and other services that often get deducted from sales.Business Insider compiled a list of some basic financial requirements for becoming a franchise owner of 12 of the biggest fast food chains in the US based on public filings. The values below are based on "traditional" franchise locations, meaning they are stand-alone restaurants as opposed to units in airports, malls, universities, or other buildings.Following the name of each restaurant chain are the average total startup costs to open one restaurant in the US.Arby's: $644,950 to $2.4 millionAn Arby's restaurantAssociated PressTotal startup costs: $644,950 to $2.4 millionMinimum liquid asset requirement: $500,000Minimum net worth requirement: $1 millionFranchise fee: A $12,500 development fee, a $37,500 license feeOngoing fees: Arby's charges a royalty fee of either 4% or 6.2% of sales, depending on store type, plus an advertising and marketing service fee of 4.2% of sales. Average per-unit sales: $1.1 million to $1.6 million, depending on store type, per franchisee disclosure documentBurger King: $363,400 to $4.7 millionStarting up a Burger King franchise requires a net worth of at least $1 million.Damian Dovarganes/APStartup costs: $363,400 to $4.7 millionMinimum liquid asset requirement: $500,000Minimum net worth requirement: $1 million Franchise fee: $50,000 for a 20-year franchise agreementOngoing fees: Burger King charges a 4.5% royalty fee and a 4.5% advertising fee (based on monthly gross sales).Average per-unit sales: $1.66 million for traditional stores, $1.32 million for non-traditional stores, per franchisee disclosure documentChick-fil-A: $426,735 to $2.3 millionChick-fil-A employees at a restaurantAndrew Renneisen/Getty ImagesStartup costs: $426,735 to $2.3 millionMinimum liquid asset requirement: noneMinimum net worth requirement: noneFranchise fee: $10,000 Ongoing fees: Chick-fil-A franchisees pay a "base operating service fee" of 15% of sales. Chick-fil-A limits its rent charges to 6% of sales. However, it's important to note that Chick-fil-A prohibits most of its franchisees from opening multiple units, which can limit potential profits, and franchisees must devote their full time and attention to operating the business. A Chick-fil-A spokesperson previously told BI it selects "a relatively small number of franchisees to operate multiple units."Average per-unit sales: In 2024, most locations averaged about $9.3 million in annual sales.Dairy Queen: $1.5 million to $2.5 millionA vintage Dairy Queen signWikiMedia CommonsStartup costs: $1.5 million to $2.5 millionMinimum liquid asset requirement: $400,000Minimum net worth requirement: $750,000Franchise fee: $45,000Ongoing fees: Dairy Queen charges a 4% royalty fee and between 5% to 6% in marketing fees.Average per-unit sales*: $1.2 million*2023 figures according to QSR Magazine.Dunkin' Donuts: $526,900 to $1.8 millionPeople waiting outside of a Dunkin' restaurantNick Ut / AP ImagesStartup costs: $526,900 to $1.8 millionMinimum liquid asset requirement: $250,000Minimum net worth requirement: $500,000Franchise fee: $40,000 to $90,000Ongoing fees: Dunkin' Donuts charges 5% of gross sales for advertising fees and a royalty fee of 5.9% of gross sales.Average per-unit sales: $1.3 million in 2024, per franchisee disclosure documentKFC: $1.9 million to $3.8 millionPeople standing in line at a KFC locationWilfredo Lee / AP ImagesStartup costs: $1.9 million to $3.8 million for a traditional outletMinimum liquid asset requirement: $750,000Minimum net worth requirement: $1.5 millionFranchise fee: $45,000Ongoing fees: KFC charges franchisees about 10% of gross revenues (4% to 5% for royalties and 5% for advertising).Average per-unit sales: $1.3 million, per franchisee disclosure documentMcDonald's: $1.5 million and $2.7 millionA sign outside of a McDonald's restaurantAPStartup costs: $1.5 million and $2.7 millionMinimum liquid asset requirement: $500,000 Franchise fee: $45,000Ongoing fees: Base rent depends on when the restaurant opened, along with the acquisition and development costs. The rent for most new McDonald's restaurants ranges between 10% of total gross sales to 15.75% for new restaurants that have opened since January 1, 2020. Additionally, there are numerous monthly and annual fees franchisees must pay, including a royalty fee of 4% or 5% of sales and an advertising and promotion fee that is a minimum of 4% of gross sales. Franchisees also pay annual fees for various software and digital equipment, such as a $150 annual fee for using self-ordering kiosks.Average per-unit sales: $4 millionPapa John's: $272,915 to $989,415Papa John's pizzaKate TaylorStartup costs: $272,915 to $989,415Minimum liquid asset requirement: $250,000Minimum net worth requirement: $750,000Franchise fee: $25,000Ongoing fees: Papa John's charges a monthly royalty fee of 5% of net sales. Papa John's also requires that franchisees spend 6% of net monthly sales on marketing.Average per-unit sales: $1.1 millionSonic: $1.7 million to $3.4 millionThe sign outside of a Sonic restaurantHollis Johnson/Business InsiderStartup costs: $1.7 million to $3.4 millionMinimum liquid asset requirement: $500,000Minimum net worth requirement: $1 millionFranchise fee: $30,000 of the $45,000 initial license fee credited via royalty.Ongoing fees: Sonic charges a royalty fee of up to 5% of gross sales and advertising fees of at least 3.25%.Average per-unit sales: $1.6 millionSubway: $199,135 to $536,745The window of a Subway restaurantWikipediaStartup costs*: $199,135 to $536,745Minimum liquid asset requirement: $100,000 Minimum net worth requirement: $150,000 Franchise fee: $15,000Ongoing fees: Subway franchisees pay weekly fees based on gross sales, which include an 8% royalty fee and 4.5% fee for advertising.Average per-unit sales: $490,000 in 2023, according to TechnomicTaco Bell: $1.9 million to $4.3 millionCustomers line up at a Taco Bell restaurant inside Miami International Airport in Miami.AP/Wilfredo LeeStartup costs: $1.9 million to $4.3 millionMinimum liquid asset requirement: $2 millionMinimum net worth requirement: $5 millionFranchise fee: $45,000Ongoing fees: Taco Bell charges a period franchise fee equal to 5.5% of gross sales and a period marketing fee equal to 4.25% of gross sales.Average per-unit sales: $2.1 million in 2023, according to QSR MagazineWendy's: $1.5 million to $3 millionThe drive-thru lane at a Wendy's restaurantAPStartup costs: $1.5 million to $3 million for a cash purchase, though the fee can be lower depending on financing optionsMinimum liquid asset requirement: $500,000Minimum net worth requirement: $1 million Franchise fee: $50,000Ongoing fees: The advertising fee is 4% of gross sales and covers both national and local advertising. The royalty fee is 4% to 6% of gross sales.Average per-unit sales: $2.1 million for franchise locationsRead the original article on Business Insider

Comments

Business News

insider

Southeast Asia's tech startups are chasing the American dream

about 1 hour ago

insider

I've run a financial independence podcast for 9 years. Here are 4 mistakes I see early retirees make all the time.

about 1 hour ago

$Priced out of Austin, he bought a one-way ticket out of the US. Now, he lives on a Thai island for a fraction of the cost.$

insider

Priced out of Austin, he bought a one-way ticket out of the US. Now, he lives on a Thai island for a fraction of the cost.

about 1 hour ago

The Weeknd And Jenna Ortega’s ‘Hurry Up Tomorrow’ New On Streaming This Week

Forbes

Comments

Business News

Southeast Asia's tech startups are chasing the American dream

I've run a financial independence podcast for 9 years. Here are 4 mistakes I see early retirees make all the time.

Priced out of Austin, he bought a one-way ticket out of the US. Now, he lives on a Thai island for a fraction of the cost.

The Weeknd And Jenna Ortega’s ‘Hurry Up Tomorrow’ New On Streaming This Week

OPEC+ Ups The Ante Via Another 411,000 Barrels Per Day Oil Output Hike

Millennial investors bought cheap stocks in Trump tariffs market turmoil

Egg prices have plummeted since Trump took office — after hitting all-time high in March

Investors say they took advantage of market instability caused by Trump’s tariffs

Pubs and restaurants are ‘under threat’ after Labour’s tax hikes — with a third now running at a loss

Supermarket giant has slashed the price of its massive 23-piece full English breakfast for Father’s Day

‘Looming crisis’ as 100,000 energy meters STILL being used ahead of RTS switch off in days

Millions of landline customers urged to contact their provider NOW ahead of digital switchover

Fire risk warning to households after UK basks in sunny spring

Why isn't 8% of my salary going into my pension like it's meant to? STEVE WEBB replies

Gen Z say they're 'judged' over how they spend their money - and family are the harshest critics

Relaxed mortgage rules will boost first-time buyers but send house prices up, says report

Millennial investors bought cheap stocks in Trump tariffs market turmoil

Calls to legally require supermarkets to reveal ‘shrinkflation’ to customers

Fire risk warning to households after UK basks in sunny spring

Today’s ‘Wordle’ #1444 Hints, Clues And Answer For Saturday, June 2nd

Carlos Alcaraz Fights Himself Before Beating Shelton At French Open

Air India in talks with Airbus, Boeing for blockbuster new narrow-body jet order: sources

Crippling cyber attack forces Co-op into flogging Christmas pastries in MAY

Five affordable ways to take the plunge and get into swimming

UFC 316 Fight Card: Prelims Odds, Picks And Predictions

When Is New Horror Thriller ‘Bring Her Back’ Coming To Streaming?

Many Trump Spending And Deregulatory Executive Orders Bypass DOGE

Green Energy’s Role In A World Where AI Data Centers Are Power Hungry

Popular chain with more than 1,600 stores to ‘close high street branch’ in blow to shoppers

RUTH SUNDERLAND: Financial crisis of 2008 still haunts us

Fever-Tree bets on U.S. to get growth fizzing again

Cadbury owner's 'disrespect' to MPs over Russia demand

Chancellor's Budget hangover leaves pubs in red

My husband and I took our kids and parents on a bucket list trip. It was so worth it.

Here’s Why ‘MobLand’ Season 2 Is Practically Guaranteed

Justice Department’s New White Collar Crime Priorities

Nicolas Cage Thriller ‘The Surfer’ Arrives On Streaming This Week

Emirates airline boss sees positive progress at troubled Boeing

High-end supermarket dubbed ‘Waitrose of the North’ with 27 stores set to close city centre branch after 16 years

Hundreds line up for Surrey condo flash sale, units discounted by 25 per cent

No more long lines? AI and other new technologies are transforming amusement parks this summer.

Devin Harjes, ‘Boardwalk Empire’ And ‘Manifest’ Actor, Dies At 41

R-Truth Shockingly Released By WWE As The Wrestling World Reacts

‘Andor’ Showrunner Confirms It Cost $650 Million, So Good Luck Doing That Again

Avengers: Doomsday ‘Set Leak’ Videos Are Our New, Inescapable AI Reality

One Of The Best Horror Movies Of The Decade Has Hit Netflix

Book Review: Stephen Witt’s Take On Nvidia, ‘The Thinking Machine’

Snack Maker Sues Aldi Grocery Chain Over Look-Alike Product Packaging

'Lilo & Stitch' passes 'Sinners' to become 2nd highest grossing film of 2025

Top defense officials say Ukraine war has blurred lines, exposing global threats

Can Trump fix the national debt? Republican senators, many investors and even Elon Musk have doubts

The U.K. seeks to send a message to Moscow as it outlines higher defense spending

Trump officials are visiting Alaska to discuss a gas pipeline and oil drilling

U.K. bans single-use vapes to stem use by children and reduce harmful litter

Amsterdam’s buzzy fitness spot Rostudios coming to Greenwich Village NYC: ‘The ideal home’

Most valuable coins you can find in your change revealed – do you have one in your wallet?

'Stranger Things' season 5 has a release date. Here's everything we know about the conclusion to the hit Netflix series.

Rare 1909 Honus Wagner Card Could Break Records At Auction

The North Fork TV Festival Celebrates 10 Years

Elon Musk Accuses Sen. Cory Booker Of Nazi Salute