Earnings Claims of Top Franchises Revealed

Earnings Claims of Top Franchises Revealed

  • Anytime Fitness
  • CruiseOne
  • Firehouse Subs
  • Jimmy John's
  • Massage Envy
  • Menchie's
  • Orange Leaf Frozen Yogurt
  • Planet Fitness
  • The UPS Store
  • Yogurt Land
  • And Hundreds More...

No, thanks. I'm not interested in uncovering the actual earnings of hundreds of franchises at this time.

Franchise Costs: Detailed Estimates of Burger King Franchise Costs (2016 FDD)

by Franchise Chatter on September 13, 2015

in Franchise Costs, Hamburger Franchise



Franchise Chatter Membership Information

Franchise Chatter Names America's Most Lucrative Franchises

Burger King Photo by Marr3wk

This post was updated on June 5, 2016 to reflect information from Burger King’s 2016 FDD (Item 7).

Detailed Estimates of Burger King Franchise Costs Based on Item 7 (Estimated Initial Investment) of Burger King’s 2016 Franchise Disclosure Document

Building Type:  ROC 2502 with 20/20 image (72-88 seats and full size co-branded facility with 50-80 seats); BK portion only

  • The total estimated initial investment necessary to begin operation of this type of Burger King restaurant ranges from $1,512,600 to $3,046,600.

Building Type:  ROC60 with 20/20 image (40-66 seats)

  • The total estimated initial investment necessary to begin operation of this type of Burger King restaurant ranges from $1,243,600 to $2,712,600.

Building Type:  ROC80 with 20/20 image (76-80 seats)

  • The total estimated initial investment necessary to begin operation of this type of Burger King restaurant ranges from $1,248,600 to $2,837,600.

Building Type:  Edge with 20/20 image (65-68 seats)

  • The total estimated initial investment necessary to begin operation of this type of Burger King restaurant ranges from $1,416,600 to $2,946,600.

Building Type:  C0-Branded Facility with Full Menu (15-70 seats)

  • The total estimated initial investment necessary to begin operation of this type of Burger King restaurant ranges from $671,600 to $1,398,600.

In-Line or Endcap Facility (20-40 seats)

  • The total estimated initial investment necessary to begin operation of this type of Burger King restaurant ranges from $612,000 to $1,305,600.

Mall Food Court Common Seating (20-40 seats)

  • The total estimated initial investment necessary to begin operation of this type of Burger King restaurant ranges from $532,600 to $1,050,600.

Indoor MRS Facility (0-20 seats)

  • The total estimated initial investment necessary to begin operation of this type of Burger King restaurant ranges from $317,100 to $671,600.

Big Box Retail (20-60 seats)

  • The total estimated initial investment necessary to begin operation of this type of Burger King restaurant ranges from $469,500 to $840,000.

Notes:

  • Initial Franchise Fee. The actual franchise fee may vary with the length of the franchise term and may, in limited circumstances, be financed. Typically, a 20-year franchise term will have a $50,000 franchise fee, and a 10-year franchise term will have a $25,000 franchise fee.
  • Travel and Living Expenses While Training. Based on one person going through the entire mandatory training program, the high estimate assumes 12 trips made in a cost efficient manner and 45 days of moderate room and board expenses.
  • Real Property/Occupancy Charge. Costs of commercial leasing vary considerably by location and market conditions. Estimates of lease costs that might be encountered are as follows:  for In-Lines, $10 to $105 per square foot, plus common area maintenance (CAM) at $2 to $60 per square foot; for Mall Food Courts, $25 to $130 per square foot, plus common area maintenance (CAM) at $10 to $70 per square foot.
  • If you buy unimproved property for your freestanding facility, the cost may range from $300,000 to $1,000,000 in typical situations.
  • Civil and Architectural Drawings/Professional Fees. You will need to employ an architect or civil engineer to modify Burger King’s standard plans for your site. Prices will vary depending on the amount of revision requested by you or your municipality, county, or state.
  • Zoning Expenses. You may need to request a zoning variance or otherwise alter current zoning conditions.
  • Improvements/Construction. The costs of construction and improvements will vary according to the condition of the property, the facility you choose, and market conditions.
  • Landscaping. Landscaping costs will vary by site and facility type and may not apply to certain locations.
  • Equipment. The low range equipment costs include Burger King Restaurant equipment only. The high range also includes the cost for required equipment needed to provide delivery services, excluding a vehicle.
  • Decor Package. You must purchase your decor package from franchisor-approved suppliers. Costs will vary depending upon the number of seats and the mix of tables, chairs, and booths.
  • Outdoor seating is optional and if approved by BKC, it may increase your costs between $2,000 and $18,000, depending upon the type of Restaurant facility.
  • Signage and Drive-Thru. Signage and drive-thru costs include Burger King signage, menu boards, and Drive-Thru Package components where applicable (preview menu boards, order confirmation unit, and duplex sound system).
  • The Double Drive Thru is optional and can be utilized in all freestanding buildings. A Double Drive Thru may increase your costs between $31,000 and $100,000.
  • You must install indoor and outdoor signage when applicable.
  • Pre-Opening Wages. You will incur pre-opening labor expenses for salaried and hourly workers. The estimate provided assumes that restaurant managers will be paid for 3 months before opening, shift coordinators will be paid for 10 weeks at 40 hours per week, and other employees will be paid for 2 weeks at 15 hours per week.
  • Opening Inventory. The franchisor estimates that the amount shown will cover opening inventory; however, the amounts may vary according to facility type.
  • Cash and Inventory Control System. You must buy your own point-of-sale (“POS”) and inventory control systems. Your actual costs may vary depending on the type of system you select.
  • Insurance. Insurance costs vary by insurability of each franchisee, Restaurant location, and facility type. You will probably be required to pay your entire premium for workers compensation, property and casualty insurance in advance.
  • Working Capital/Additional Funds. You will need to support ongoing expenses to the extent they are not covered by sales revenue. Unless otherwise stated, the franchisor estimates the start-up phase of your business to be 3 months.
  • Business Licenses, Utility Deposits, Lease Deposits and Payments. The franchisor estimates that you will need to provide security and other types of deposits. The amounts will vary by type and business practices.
  • Indoor Playground. The 2-Story Indoor Playground is optional and can be utilized in all freestanding buildings. A 2-Story Indoor Playground may increase you costs between $135,000 and $245,000.
  • The franchisor has relied on the experience of company-operated stores for real estate and construction costs and its experience as a franchisor in the industry in preparing these figures.



Franchise Matching Quiz

{ 0 comments… add one now }

Leave a Comment

Previous post:

Next post: