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

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

• Section II – Estimated initial investment for a Bonchon Chicken franchise, based on Item 7 of the company’s 2018 FDD

• Section III – Initial franchise fee, royalty fee, marketing fee, and other fees for a Bonchon Chicken franchise, based on Items 5 and 6 of the company’s 2018 FDD

• Section IV – Number of franchised and company-owned Bonchon Chicken outlets at the start of the year and the end of the year for 2015, 2016, and 2017, based on Item 20 of the company’s 2018 FDD

• Section V – Presentation and analysis of Bonchon Chicken’s financial performance representations, based on Item 19 of the company’s 2018 FDD, including information on the:

• fiscal year 2017 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”)

• 2017 average gross revenue for the 48 franchised Bonchon Restaurants that have been open and operating for at least 12 months before December 31, 2017 (“2017 Mature Franchised Restaurants”)

Section I – Background Information

13 Things You Need to Know About the Bonchon Chicken Franchise

Opens First San Diego and Minnesota Locations

1.  Bonchon Chicken is continuing its growth across the United States with the opening of its first location in San Diego. The new Bonchon restaurant opened at the beginning of November 2018 in the Kearney Mesa neighborhood. For the first two weeks, the San Diego Bonchon had shortened hours and was not doing takeout orders. Bonchon said that it had at least two more locations planned for San Diego in Chula Vista and San Marcos.

2.  In early April 2018, Bonchon Chicken announced that it would be opening its first two locations in Minnesota. Both new Bonchon restaurants replaced vacant restaurant spaces and are owned and operated by restaurateur Sam Zheng. Zheng also owns several local buffet concepts like Lakes Buffet in Richfield and Royal Buffet in Burnsville. At the time of the announcement, the Dinkytown Bonchon was slated to open in late summer and the Uptown Bonchon was set to open in July.

3.  Marshall Nguyen with Edina-based Caspian Group facilitated the deal for Zheng to open Bonchon in Dinkytown. Nguyen said, “We have such a big Asian community of students down at the University of Minnesota and this has been what they’ve wanted: Korean fried chicken with flavorful recipes.”

Offering Franchisees Flexibility and Hands-On Support

4.  Bonchon Chicken is driving its international expansion primarily through franchised locations. According to Bonchon, its concept is appealing because it has unique menu offerings that feature Asian fusion cuisine. Bonchon’s main product, fried chicken, is made to order using the unique double-frying method perfected by founder Jinduk Seh.

5.  The menu consists of a variety of fusion Korean and Asian dishes, such as Bibimbap, Japchae, and Tteokbokki. Bonchon also has an American-inspired line featuring Bonchon sliders, tacos, wraps, and seasoned french fries.

6.  In addition to unique food, Bonchon offers a variety of dining experiences. Franchisees have the flexibility to choose from three different concepts for their restaurant: sports bar, traditional sit-down, or quick service. Some restaurants also offer take-out and delivery services.

7.  Sports bar restaurants feature a full bar and televisions for broadcasting games. The traditional sit-down restaurants provide a friendly, casual experience where friends and family can gather. Bonchon’s quick service restaurants serve customers looking for express-style dining.

8.  Bonchon franchisees benefit from training programs, including a four-week initial training at the company’s headquarters in New York City and an intensive five-day on-site training during the store opening. Additionally, franchisees receive support for ongoing operations, quality assurance, public relations, and marketing.

9.  The initial franchise fee to open a Bonchon store is $40,000, and the initial investment varies from $500,000 to $900,000+ depending on numerous factors, such as restaurant size and location, to name a few. Bonchon is looking for franchisees who are enthusiastic about starting their own Bonchon establishment; dedicated to operational excellence; committed to providing high-quality service; and capable of meeting the financial requirements.

Company History

10.  Bonchon Chicken was founded in 2002 by Jinduk Seh in Busan, South Korea. “Bonchon” means “my hometown” and is an homage to the company’s roots. The chicken chain focuses on selling Korean-style fried chicken wings, which have increased in popularity outside of South Korea as Korean culture has become more visible around the world.

11.  Bonchon Chicken started franchising immediately and opened its first international location in Fort Lee, New Jersey in 2006. Not long after, Bonchon Chicken opened its second U.S. location in Manhattan, New York, which now serves as the company’s flagship U.S. restaurant.

12.  Today, Bonchon Chicken has locations in nine countries, including the United States, the Philippines, Thailand, Indonesia, Kuwait, and Singapore. Bonchon Chicken has a mix of corporate and franchised locations and is looking to expand around the world.

Entrepreneur’s Franchise 500

13.  Bonchon Chicken did not rank on Entrepreneur’s 2018 Franchise 500 list.

Section II – Estimated Costs

• Please click here for detailed estimates of Bonchon Chicken franchise costs, based on Item 7 of the company’s 2018 FDD.

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

• Please click here for detailed information on Bonchon Chicken’s initial franchise fee, royalty fee, marketing fee, and other fees, based on Items 5 and 6 of the company’s 2018 FDD.

Section IV – Number of Franchised and Company-Owned Outlets

Franchised

2015

• Outlets at the Start of the Year:  22
• Outlets at the End of the Year:  34
• Net Change:  +12

2016

• Outlets at the Start of the Year:  34
• Outlets at the End of the Year:  50
• Net Change:  +16

2017

• Outlets at the Start of the Year:  50
• Outlets at the End of the Year:  67
• Net Change:  +17

Company-Owned

2015

• Outlets at the Start of the Year:  2
• Outlets at the End of the Year:  2
• Net Change:  0

2016

• Outlets at the Start of the Year:  2
• Outlets at the End of the Year:  2
• Net Change:  0

2017

• Outlets at the Start of the Year:  2
• Outlets at the End of the Year:  2
• Net Change:  0

Section V – Financial Performance Representations (Item 19, 2018 FDD) and Analysis

Part 1 – Company-Owned and Operated Bonchon Restaurant

• Although as of December 31, 2017, there were a total of 2 company-owned Bonchon Restaurants, Part 1 contains historic financial performance information concerning the 1 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”).

• The financial information provided is for Bon Chon USA, Inc.’s most recent fiscal year, which is the 12-month period from December 1, 2016 through November 30, 2017 (“2017 Fiscal Year”).

• Bonchon’s President and Chief Executive Officer, Jinduk Seh, owns and operates a Bonchon Restaurant in Allston, Massachusetts (the “Allston Restaurant”). Because the Allston Restaurant offers an expanded menu which is not available at other Restaurants, its financial results are not indicative of the financial results which you may achieve.

• Accordingly, the financial performance information for the Allston Restaurant has not been included in this Item 19.

• You should understand that the Company-Owned and Operated Restaurant has been in operation since 2006; therefore, the information provided reflects a well-developed customer base. As such, a new franchised Bonchon Restaurant may not achieve the same results.