FDD Talk 2017: What You Need to Know About the Bonchon (Korean Fried Chicken) Franchise Opportunity (Financial Performance Analysis, Costs and Fees)

In this FDD Talk 2017 post, you’ll learn the following:

• Section I – Background information on the Bonchon franchise opportunity, including relevant news updates

• Section II – Estimated initial investment for a Bonchon franchise, based on Item 7 of the company’s 2017 FDD

• Section III – Initial franchise fee, royalty fee, marketing fee, and other fees for a Bonchon franchise, based on Items 5 and 6 of the company’s 2017 FDD

• Section IV – Presentation and analysis of Bonchon’s financial performance representations, based on Item 19 of the company’s 2017 FDD, including information on the:

• fiscal year 2016 gross revenue for the Bonchon Restaurant in New York, New York owned and operated by the franchisor’s affiliate, Bon Chon USA, Inc. (the “Company-Owned and Operated Restaurant”)

• 2016 average gross revenue for the 33 franchised Bonchon Restaurants that have been open and operating for at least 12 months before December 31, 2016 (“Mature Franchised Restaurants”)

Section I – Background Information

9 Things You Need to Know About the Bonchon Franchise

One of New York’s Best Chicken Wings, According to Grub Street

1.   Earlier this year, Grub Street released its list of “The Absolute Best Chicken Wings in New York.” Bonchon came in at number four for its “Half & Half” wings, which is a mix of the chain’s two wing flavors, Soy Garlic and Spicy. According to Grub Street, Bonchon made the list because of their chicken’s “twice fried thin-skinned crispness.”

Opening New Locations

2.  Bonchon’s popularity in the U.S. has been picking up, and several new locations are in the works. Locations are set to open soon in Orlando, Chicago, and several cities in California.

3.  Recently, Bonchon opened a location in Baltimore that local foodies had been waiting for since last year. Due to the anticipation, the restaurant held a soft opening in early February to avoid a large crowd, but word quickly spread. According to Greg Trepetin, Bonchon’s Baltimore area developer, customers had to wait for over an hour to be seated during the soft opening. Trepetin will be opening a second Baltimore area location later this summer.

Developing a Cult Following

4.  Although Bonchon has less than 100 locations in the U.S., the chain has already attracted a cult following. Customers are drawn to the chain’s style of chicken wings, which is familiar yet different. Bonchon boasts a made-from-scratch philosophy and all of its chicken, which can take upwards of 25 minutes to prepare, is made to order. According to many reviews, the wait is worth it.

5. Bonchon’s chicken is twice fried, which produces a thin yet extra crispy skin. The chicken comes as strips, wings, or drumsticks which are then coated in either a Soy Garlic or Spicy glaze. Customers also have the option of ordering a Half & Half mix of both sauces.

6.  In addition to its chicken, Bonchon serves traditional Korean dishes such as Bibimbap, Japchae, Bulgogi, and Tteokbokki. There are also several Asian-inspired dishes such as Bulgogi Sliders, Korean Tacos, and the Bonchon Wrap.

Company History

7.  Bonchon’s first restaurant was opened in 2002 by Jinduk Seh in Busan, South Korea. The first U.S. location opened in New Jersey in 2006. Today, there are Bonchon locations in California, New York, Maryland, Massachusetts, New Jersey, and Texas. The company’s U.S. headquarters, where all the training is done, is located in New York.

8.  There are currently over 50 Bonchon locations in the U.S. with several more restaurants opening soon. Bonchon has over 100 international locations in countries such as South Korea, the Philippines, China, Cambodia, Singapore, Thailand, Indonesia, Bahrain, and Kuwait.

Entrepreneur’s Franchise 500

9.  As a fairly new and small franchise, Bonchon has yet to appear on Entrepreneur’s annual Franchise 500 list.

Section II – Estimated Costs

• Please click here for detailed estimates of Bonchon franchise costs, based on Item 7 of the company’s 2017 FDD (updated).

Section III – Initial Franchise Fee, Royalty Fee, Marketing Fee, and Other Fees

• Please click here for detailed information on Bonchon’s initial franchise fee, royalty fee, marketing fee, and other fees, based on Items 5 and 6 of the company’s 2017 FDD.

Section IV – Financial Performance Representations (Item 19, 2017 FDD) and Analysis