In the franchising world, Chick-fil-A is a popular choice, but is it really a good investment? In this article, we are going to take a detailed look at this franchise, from its financial figures to its franchisee selection process, including its business model and policies.
If you want to know more details about what makes Chick-fil-A an interesting option for investors, we invite you to watch the video we have prepared below. In it, we explore key aspects of the franchise and answer some of the most frequently asked questions investors often have. Check it out:
How much does a Chick-fil-A franchisee make?
Chick-fil-A is known for its unique approach to the fast food market. Since its founding in 1967, it has maintained a simple menu and efficient operation that has led it to be one of the most successful franchises in America.
According to Chick-fil-A’s Franchise Disclosure Document , there are currently 2,411 franchisees operating throughout the United States, including Puerto Rico.
Despite operating only six days a week and closing on Sundays, Chick-fil-A outperforms many of its competitors in gross sales. On average, a Chick-fil-A unit is generating $2.4 million in annual gross sales, with some branches reaching figures in excess of $10 million.
However, this business model is designed so that franchisees are more like “operating partners”. Instead of owning the establishment, they earn a percentage of the profits, which ranges from 5% to 7%.
How much does it cost to open a Chick-fil-A franchise?
Chick-fil-A’s franchise model is unique in the world of franchising. The franchisees do not invest in the construction of the premises, since all the financing comes from the Chick-fil-A corporation . However, this also means that operating partners cannot have any other employment or business that competes with Chick-fil-A, which can limit their opportunities for diversification.
In general, the down payment to acquire a Chick-fil-A franchise is less than $10,000. Importantly, Chick-fil-A does not charge a traditional franchise fee, but rather an application fee for the license.
Requirements to open a Chick-fil-A franchise
Joining the Chick-fil-A franchisee network is no easy feat. With only about 0.0025% of applicants accepted each year, competition is fierce.
Chick-fil-A is looking for operating owners who share its values, including Christian values, and are committed to making a difference in their communities.
The selection and training process can take anywhere from 12 to 18 months, reflecting the high level of commitment required to own a Chick-fil-A franchise.
*Data as of the date of publication of the last FDD of the franchise
*Values expressed in US dollars
Is the Chick-fil-A franchise a good investment opportunity?
Despite its success as a fast-food franchise, Chick-fil-A may not be the best choice for investors looking to diversify their portfolio.
With strict policies on involvement in other businesses and a highly competitive selection process, acquiring a Chick-fil-A franchise can be more akin to being an employee than owning your own business.
Additionally, the company has the ability to get rid of a franchisee if they fail to meet its standards, which can pose a risk to investors.
If you are considering investing in Chick Fil-A or would like to learn about other profitable franchises, please contact us. At Interlink FBC we are ready to accompany you in the search and analysis of a franchise according to your profile and resources.
